The UK’s build-to-rent sector could soon take a 20% share of the new homes market if it follows trends seen in the US.
New research from letting agent Ascend Properties reports huge growth potential in the sector where an estimated 11,723 build-to-rent homes – mainly apartments for professionals – are due to complete this year, a 22% increase in just four years.
The comparable Stateside build-to-rent model – known as multi-family – completions are set to top 327,718 units this year, a 19% jump from 2018.
Multi-family completions accounted for 23% of all new builds in the US that year, with this number staying consistent last year (22%), while in the UK build-to-rent accounted for just 4% of all new build completions in 2018, climbing to 6% last year.
However, Ascend believes this is an impressive rate of growth for a sector yet to fulfil its full potential and predicts this could change as the emerging market becomes more established.
Both countries deliver tailor-made accommodation for long-term living within the rental sector, with a focus on community and plenty of amenities.
As the build-to-rent sector is growing fast, it won’t be long before it’s accounting for the same proportion of new builds in the UK, if not more, says MD Ged McPartlin. “A comparison of the multi-family model and the build-to-rent sector isn’t quite comparing apples with apples, but the ethos is very much the same and so is the end result,” he adds.
“The multi-family market is a trillion-dollar business and accounts for more than a quarter of all real estate investment in the US. While we have quite some way to go in achieving this sort of dominance in the build-to-rent sector, the sharp growth seen in recent years suggests we are well on our way.”