Build to Rent (BTR) is growing rapidly across the UK, with over 140,000 homes currently under construction or in planning.
The majority of BTR homes (81%) are in the 20 cities where Government has increased housing targets, highlighting the critical role these homes have in meeting national housing targets.
Now, the largest ever analysis of Build to Rent occupancy in England claims to dispel the perception that BTR is an unaffordable housing option.
The research highlights that BTR is home to a diverse mix of residents and is making a crucial contribution to housing need in both urban and suburban areas.
In its second year, the ‘Who Lives in Build-to-Rent?’ report from the British Property Federation (BPF); Dataloft; London First; and the UK Apartment Association (UKAA), analysed 89 schemes in England totalling over 20,000 residents in over 15,000 homes.
The urban component of the data, constituting 15,887 residents and12,404 homes across 49 schemes was benchmarked with tenants in the Private Rented Sector (PRS), finding that BTR has a similar resident profile across income, profession, age and affordability.
BTR residents’ incomes are broadly similar to those in the PRS – in the urban BTR sample, 32% of residents earn between £19-32k per year and in the PRS it is 37%.
The Office for National Statistics (ONS) considers housing to be affordable if tenants spend 30% of their income on rent.
Monthly rental costs for couples and sharers living in BTR are 30%, aligning with the ONS’ affordability benchmark, compared to 33% of monthly income in the wider PRS. For single renters BTR is on average fractionally more affordable than the PRS at 32% of monthly income vs. 33%.
BTR doesn’t just provide residents with a home for their monthly rent payment – 78% of schemes in the urban data had a roof terrace or shared garden, 73% a have a concierge, 73% have social events, 69% have parcel acceptance and storage, and 61% have a co-working space.
Across the urban data, one in five renters (18%) in BTR are public sector workers, providing affordable and secure homes for key workers in the capital and across England’s cities and town centres. Both BTR and the PRS house similar numbers of creatives, tech professionals and leisure workers.
Over four in ten residents in both the BTR and PRS are 25-34 years old, the most common age band. But increasingly BTR is catering to other parts of the market, with one in ten residents aged over 45.
BTR is also evolving to suit the needs of different types of renters. The emergence of Suburban BTR – high-quality, professionally managed homes located in suburban and peri-urban areas – is providing affordable and attractive housing for all, but particularly families, who represent 43% of the suburban BTR sample in the report.
James Simondson, Assistant Director (Housing), British Property Federation, commented:
“BTR homes – high-quality, professionally managed, purpose-built homes for private rent – are being taken up by a diverse range of people across England.
“Our report shows that residents in BTR are much more representative of the wider PRS than is often perceived – with one in five residents employed in the public sector and broad similarities across age, income and affordability.
“What’s more, BTR is delivering homes in the cities that government has identified for additional housing delivery.
“It is of paramount importance that the UK seeks to address the housing crisis by building a range of different properties and tenures to suit everyone’s needs.”
Stephanie Pollitt, Programme Director (Housing) at London First said:
“BTR developments have shown that they are an important part of the overall housing mix in England, their diversity of which reflects the needs of those that choose to rent there.
“With a variety of amenities included in their monthly rent, BTR not only gives residents more bang for their buck, but also provides a unique and flexible renting experience, something which will continue to be reinforced as the sector matures.”
Sandra Jones, Managing Director at Dataloft, added:
“This research shows that the BTR sector is providing options for renters who already live in the wider private rental sector. PRS vs. BTR is not a binary ‘them and us’ and this kind of data sharing initiative is key to understanding the whole rental ecosystem.”