Build-to-Rent specialist Ascend Properties has forecast that this sector will boom as we leave the pandemic and completions will continue to double by 2025. These types of buildings are built explicitly for tenants, often providing free wifi, communal spaces, rooftop gardens, on-site gyms and cinemas, as well as incentives such as no deposit or fixed long-term tenancies. And with the pandemic showing us how much of our work can be done at home, these properties are even more popular with those who are looking for a remote working space still nearby their place of work.
Investors looking to take advantage of the current property boom and the demand for BTRs need to consider the Ascend Properties forecast. Ascend highlights the year-on-year completion trends and how this shows the market’s growing momentum. Between 2017 and 2018, the number of BTR completions reaching the market rose by only 1%. However, in the following year, the number of completions jumped to 54%. To put this in perspective, Ascend Properties emphasised how completions from 2018 to 2019 of non-BTR properties only grew by 6%.
And while completions fell 20% in 2020 due to COVID-19, it’s the whole property market which has been affected briefly, with a 28% fall in completions of non-BTR new-builds. Still, the overall size of the BTR has continued to increase in the past couple of years. With the economy set to improve in the coming months due to vaccinations and ease of restrictions allowing people back to work, we can only see BTR coming back with a boom.
Based on data from the BTR sectors, Ascent has predicted that a further 73,535 BTR completions should reach the market by the start of 2025. Alongside the existing 53,750 BTR completions already within the market, this forecast could see a total of 127,285 completions in four years.
Ged McPartlin, managing director of Ascend Properties, said, “there’s a growing recognition that owning property may not be the norm in the future, as is already the case in numerous other European countries. In the UK’s most expensive regions such as London, many already rent for far longer than we’ve seen traditionally and while we remain a nation of aspirational homeowners, not everyone is as focused on realising this aspiration” (Property Investor Today).
People and families of all ages are instead looking for high-quality properties to suit their needs. Here is where BTR fits the gap, and as a result, there is no surprise to see the sector face impressive growth. Property investors looking to build their portfolio with properties in demand need to acknowledge this projected BTR growth and notice the returns they can make on investments in this sector.
People who ignore this exponential growth in the UK property market will miss out on some fantastic benefits. With long-term tenancies now the norm, a BTR can help provide an ongoing stream of revenue ideal for investors just starting or those heading into retirement. By spreading BTRs across the UK from London, to Manchester, you can benefit from the city lovers, young professionals, students and even families looking for easy city access and short commutes.