COMMENT As urban landscapes evolve and housing preferences shift, the dynamics of the rental market continue to transform. In this ever-changing landscape, build-to-rent emerges as a prominent player, not only reshaping the way people live, but also influencing where they choose to call home.
When it comes to relocating to a new rental property, people traditionally tend to stay close to their current locale. However, our analysis reveals a noteworthy trend: BTR properties exhibit a unique allure that extends beyond the immediate vicinity. Compared with conventional privately rented households and new-build buy-to-let properties, BTR developments attract a higher proportion of movers from areas further away from the site. This trend underscores the distinct appeal of BTR accommodation, offering a blend of modernity, efficiency and enhanced services that resonate with renters seeking a lifestyle experience.
Convenience and comfort
In fact, data shows that the median distance of movers to BTR accommodation in the UK is 5.8 miles. This is almost double the distance for PRS as a whole and 39% further than for new-build BTL. One of the key factors driving this trend is the inherent efficiency of newer properties, which not only promise contemporary amenities but also boast cost-effective maintenance and utility expenses. Additionally, the comprehensive management and service offerings associated with BTR developments add an extra layer of convenience and comfort, further enticing renters to venture beyond their immediate neighbourhoods in pursuit of an elevated living standard.
Our analysis suggests that the schemes with the broadest catchments tend to be located in core cities. On average, schemes in the UK’s 11 largest regional cities have attracted tenants from 8.3 miles, compared with five miles for BTL and three miles for the PRS as a whole. These schemes tend to have significant marketing budgets, which have allowed them to attract tenants from far beyond their local market.
Schemes delivered in cities such as Manchester and Leeds have also really differentiated themselves from other nearby new-build developments. They have been able to stand out by fostering a sense of community and offering the high levels of service and convenience that modern renters are searching for. Submitting maintenance requests to a 24-hour on-site management team and paying your rent and bills is all available in the palm of your hand through the resident mobile phone app. This convenience-led offering, far exceeding that on offer from individual private landlords, means tenants are willing to move 8.8 miles and 9.6 miles on average to schemes in these cities respectively, compared with 7.3 miles and 5.6 miles for BTL.
Demand dynamics
However, it is essential to acknowledge that such lifestyle offerings often come with a corresponding price tag, making BTR accommodation more accessible to those with higher incomes. Nonetheless, the broader catchment area facilitated by BTR properties signifies a departure from the traditional confines of the local rental market. While the local market remains integral to a scheme’s demand dynamics, the expanded reach of BTR properties diversifies the pool of prospective renters, enriching the rental landscape with greater diversity and choice.
Indeed, the rise of BTR marks a shift in the rental sector, redefining not only where people live but also how they experience urban living. As cities evolve into dynamic hubs of innovation and opportunity, BTR emerges as a catalyst for inclusive and sustainable urban development, offering a compelling alternative for renters seeking more than just a place to reside.
As BTR continues to redefine the parameters of urban living, its ability to draw movers from further afield underscores its growing significance in shaping the future of rental housing. With its blend of modernity, efficiency and services, it represents not just a place to live, but a lifestyle choice that transcends geographical boundaries.
Guy Whittaker is head of UK BTR research at Savills
Photo © Savills
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