Build to Rent (BTR) developers’ response to Covid has tested promises they made to tenants around hassle-free living and being an antidote to the traditional landlord, says residents review platform HomeViews.

Its National Build to Rent report – which gathers reviews from residents of new build developments – reveals that some tenants in the sector have battled with owners over whether they should be entitled to rent reductions while they weren’t getting the full range of services.

Some operators offered discounts or agreed not to raise rents, but despite usually being under no obligation to offer a discount, tenants viewed their apartments in the wider context of the building and services they could enjoy – and without these, some felt they were paying too much.

HomeViews reports: “Most tenants who commented negatively on value for money during Covid simply compared their rents to the wider market and were not impressed with what they saw. Others felt that rent increases showed a lack of care for tenants during a pandemic.#

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Constantly increased

“One resident at a London scheme said, ‘Due to the current economy I find it hard to understand how rent is constantly increased yearly. This does not show loyalty hence why many tenants move out and find cheaper accommodation at the same or better quality.’”

However, the fact that average value scores actually increased from 3.99 out of 5 in 2019 to 4.08 in 2020 suggests that many tenants are still happy with their buildings.

It adds: “There is also evidence to suggest that they did not go as far as voting with their feet.” HomeView believes that high ratings, despite closed communal areas, shine a positive light on the sector and in particular the work of on-site management teams.

Read more about build to rent.

1 COMMENT

  1. BTR is not needed as an antidote to the small private LL.

    BTR is a different type of offer.

    Some tenants make like the BTR offer which by it’s very nature tends to cost more.

    For value for money the smaller LL tends to have the better offer.

    Small LL tend to just offer decent accommodation.

    They don’t go in for what invariably turns out to be costly bells and whistles.

    There is space in the PRS for all different types of offers.

    It is the tenant that will decide what offer they prefer.

    I maintain tenants will stick with smaller LL.

    They won’t wish to pay for add-ons.

    Obviously if the rent is the same and BTR offers more for the same price as a normal small LL offer then BTR will be an attractive option.

    I maintain the BTR offer is unsustainable.
    Not possible to offer stuff effectively for free.

    We’ll see who is correct over the coming years WON’T we!!??

    But one thing tenants can be absolutely sure of and that is BTR rents will increase for more than with a small LL.

    BTR has to generate sufficient profit to pay dividends.

    The elephant in the room as far as BTR is concerned is that of potential rent controls.

    That is why corporates got out of residential lettings back in the 60’s along with fixed tenancy tenure.

    Regulations are leading back to how the PRS was decades ago.

    Rent controls etc will reduce the asset value of rental property.

    Just one of the many reasons as to why I’m getting out of the PRS for long term lettings.

    Corporates don’t seem to have considered these possibilities which is very naive.

    They could be lumbered with rent controlled sitting tenants for decades.

    Not something that investors would be very pleased with to say the least!

    Such circumstances could be likened to to the retrospective nature of S24.

    Corporates should perhaps base their viability on HB rates rather than market rents.

    Rent controls would be a very popular policy.
    Especially as even more tenants will be evicted over the coming next 3 years.

    It will take that long for feckless rent defaulting tenants to be removed.

    Private LL would do well to become more financially resilient by selling off and deleveraging.

    Prepare for rent controls!!

    BTR will be stuffed!

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