Landlords need to install bike storage, allow pets and quickly sort out maintenance issues if they want to compete with the growing build to rent (BTR) sector.
Estate agent Foxtons helpfully advises them that highlighting amenities within a few minutes’ walk, including gyms, green space, parking and co-working office space would help landlords compete with the purpose-built blocks.
Its latest London Lettings Report says landlords and their lettings agents need to take note of why BTR is appealing to many renters and what this means for their offering.
Sarah Tonkinson (pictured), Foxtons MD – institutional PRS and build to rent, says renters in build to rent developments are buying into a lifestyle as their every need is catered for.
She adds: “The leases are long and the community feeling is strong. The wider market needs to take notice of build to rent developments as they’re the benchmark to which eventually all landlords will be held.”
Foxtons reports that BTR housing stock in London grew 24% in the last 12 months to 30,000 homes, with almost 55,000 currently under construction.
Demand is high, with 27% of the agent’s BTR units let within one week of coming to market, compared with 16% for the rest of the sector. While BTR still only accounts for 1% of the private rental market, it has huge potential, says Foxtons, as it currently accounts for 8% of its lets, up from 2.2% in 2017.
It reports that the average rent paid for homes in BTR developments to the surrounding local market. For one-bed flats, there was an average 9.1% premium per week while for two-bed flats, it was an average of 11.3%.
Foxtons adds that private landlords still have a major role to play in the rental sector and can be reassured that BTR isn’t for everyone, as some renters value their privacy and are not attracted to the ‘community’ aspect of BTR.
Read more: What does build-to-rent mean for buy-to-let?