Build-to-rent is the revolution the UK’s PRS needs. So why should investors get excited & where will the best returns be found?
The UK’s private rented sector (PRS) is evolving.
More people want to rent property, but the supply of available real estate cannot keep apace. Britons want increasingly better quality rental accommodation, but what’s available is often dated; unsuitable for the demands of the modern tenant.
It’s a sector with product that can no longer satisfy the end-user ─ tenant expectations have advanced but the PRS has not done so in kind. However, this is now about to be addressed.
A property market that’s changing
Recent hikes to stamp duty land tax (SDLT) thresholds for second homes and buy-to-let properties marked the start of the PRS’ future. It was a move that confirmed what tenants have long held to be true; that buy-to-let is broken, a solution reaching the end of its lifecycle.
In its place will come a new product. One that provides the experience tenants now demand. One that will satisfy the 7.2 million households that will be renting by 2025. One that will boast higher levels of investment longevity for the UK’s property investors.
Build-to-rent is buy-to-let’s natural succession.