The Increasing Popularity of Build-to-Rent Investments

Ross McColl
3 min read
Dec 11, 2023
Updated: Dec 13, 2023

Build-to-Rent (BTR) in the UK

Build to Rent (BTR) has emerged as a revolutionary sector in the UK real estate market, attracting attention from institutional investors, landlords, and developers. This innovative approach to property investment is reshaping the traditional models and gaining significant momentum.

What is Build to Rent?

Build to Rent involves constructing new residential units specifically for renting purposes, rather than individual sales. These developments are managed by a single institutional entity or estate agent, providing tenants with integrated services and facilities. This not only ensures better management but also promotes a sense of community among residents.

The Data Reveals a Thriving Market

According to the British Property Federation, there are already 157,512 completed BTR homes in the UK, with an additional 86,787 under construction and 80,730 in the planning stages as of Q4 2020. With consistent growth, this sector offers great potential for investors.

Recognizing the importance of Build to Rent, the NHBC has recently launched a dedicated insights collection to provide comprehensive data and information to assist investors and developers in making informed decisions.

Why Choose Build to Rent?

  1. Stable Returns: Build to Rent offers landlords the potential for consistent, inflation-linked returns. The steady income generated from rental properties serves as a buffer against economic volatility, providing attractive risk-adjusted returns.

  2. Growing Demand for Quality Rentals: With home ownership becoming increasingly unattainable, especially for younger generations, there is a rising demand for quality rental accommodations. Build-to-rent properties, with their emphasis on quality and tenant satisfaction, are ideally positioned to meet this need.

  3. Professional Management: The management of BTR developments by professional entities brings several advantages over the traditional buy-to-let model. From streamlined tenant management to efficient property maintenance, this leads to higher tenant retention rates and reduced vacancy risks.

  4. Government Support: The UK Government actively supports Build to Rent by offering planning incentives and financial assistance. This positive regulatory environment further enhances the appeal of investing in this sector.

The surge in popularity of Build to Rent investments represents a significant transformation in the UK property market. By aligning the interests of landlords, tenants, and investors, this approach creates a win-win situation that holds tremendous potential for the future of housing in the country. The ongoing growth of this sector, driven by strong demand and supported by favorable regulations, makes Build to Rent an enticing investment opportunity for landlords seeking portfolio diversification.

If you're a landlord interested in exploring the Build to Rent sector, we invite you to reach out to our expert team or visit us on our website Link Property. We can provide guidance on this exciting investment opportunity, helping you make informed decisions that align with your financial goals.