What are build-to-rent properties?
Over the past 12 months there has been a big rise in the number of build-to-rent properties being developed around the UK. But what is build-to-rent and how does it work? We explain some of the details below.
What does build to rent mean?
When talking about ‘build-to-rent’ it describes properties that are purposely made to be rented out to tenants. They are usually either apartments or studio flats constructed by developers which feature at least 50 homes, with one landlord managing them all.
While there are still only a relatively small number of build to rent properties in the UK it is a fast growing sector. The British Property Federation say there are over 167,000 build-to-rent homes that are planned, under construction or completed. Compared to 2019 this is a 22% rise.
They are becoming a more attractive option for renters unable to afford the high cost of home ownership.
How does it work?
A build-to-rent development is typically owned by either a single organisation and managed by a lettings agency.
Funding for the construction of the development is sourced via investors who in the long-term will be able to enjoy rental returns. There are also a number of schemes backed by the government to help with the building of the properties and supporting infrastructure.
What are build-to-rent homes likes?
Build-to-rent homes usually feature high quality specifications, with built-in Wi-Fi, fast internet connections and luxury fixtures, fittings and furnishings. Quite often they are constructed in and around city centres to ensure residents have good access to the surrounding area.
In many respects, build-to-rent homes are like mini communities featuring a host of spaces and facilities for residents to use and interact with each other.
This can include things like a gym, on-site restaurants, bars, shops and shared workspaces. Some also feature their own concierge.
The idea behind many of these developments is provide almost everything residents need in one space, creating a readymade environment that complements the way they live.
What are the benefits of build-to-rent?
One of the main benefits of built-to-rent is that there is a single landlord responsible for managing all of the properties. This makes communication easier for tenants and should ensure that any issues can be resolved more efficiently.
This also feeds into the raising of complaints, as there must be a set procedure in place for tenants to use. The landlord must also be a member of a recognised ombudsman scheme, offering further security for tenants living there.
Renting from a recognised company also offers more assurances to renters, without some of the doubt that may come with renting from a private landlord. The quality of the build is also an important factor, with the development guaranteed to meet safety and energy efficiency requirements, which will lead to a better standard of living.
What are the disadvantages?
While build-to-rent properties were supposed to offer an affordable alternative to private renting, this is not always the case. The Government dictates that at least 20% of the homes are let at an affordable rate, although that is 20% below the local rate, so there is no guarantee rent will be lower than general market rates.
If you would like to know more about build-to-rent, contact us today on 0208 459 2530 or via email email@example.com, we’ll be happy to provide more information and answer any questions you may have.