The most recent research into the Build To Rent sector in the UK shows that it has grown by 30% in the past year.
The study, conducted by Savills for the British Property Federation at the end of Q1 2018, revealed that across the country there were 117 893 build to rent homes either complete, under construction or in planning compared to 90 761 same period last year.
“Investors want assets which are going to provide returns over the long term, which drive up quality; architects and planners have the opportunity to create a built environment for communities; and local authorities are beginning to understand how BTR could tackle brown field sites, support new infrastructure development and be a catalyst for further development,” said David Melhuish, director of Scottish Property Federation, highlighting the importance of BTR sector to the country as a whole and the local communities alike.
Build To Rent gap between Scotland and rest of UK
According to the figures from the Scottish Property Federation, Scotland makes up less than 3% of the whole BTR sector in the UK with 3 365 purpose built rental homes across all stages of the development process. That means that for every build to rent property in Scotland there are ten in North West England for example, where the total number of build to rent homes equals 29 600. In comparison, the South East England, excluding London, has 7 101, the West Midlands 6 378 and Yorkshire and The Humber 5 131.
Positive signs of growth of the BTR sector in Scotland
Despite this significant gap, the Scottish BTR sector is picking up and “there are now multiple sites in Glasgow which should act as a spur to other BTR projects across the country”, said Mr Melhuish.
He continued: “BTR is an opportunity and Scotland has some important advantages for attracting the investment necessary – the Rental Income Guarantee Scheme being one and an exemption from the 3 per cent second homes tax for large-scale PRS investments is another. With planning policy guidance now amended to support BTR developments, particularly around the treatment of development viability, there is no reason why we cannot see the BTR sector provide a new catalyst of economic growth in our cities.”
Shift in perception of BTR
It is worth noting that as the BTR sector grows and attitudes to renting are changing, BTR units are no longer just typical high-rise apartments, there are now houses too.
“Build-to-rent has historically been characterised as simply a step up from student accommodation for millennials, but this is now changing. The sector’s growth means it can cater for a wider range of people, including families. These purpose-built rental properties are high-quality, often with linked amenities, sustainably constructed and well-managed intergenerational homes.”
“As a result, there is now a significant shift in perception and we are beginning to see changes here in Scotland, which will help boost further BTR development.”