Gone are the days when rental schemes catered almost exclusively for recent graduates and young professionals, who want to enjoy city living while waiting to get on the property ladder.
Now we are seeing more people in their 30s and 40s renting, not out of necessity, but because they are looking for fully-serviced, ultra-low maintenance homes in the suburbs.
Sometimes they are relatively high earners not yet ready to tie their capital up in property, and/or need the flexibility of being able to relocate easily for work. Then, of course, there are those who rent later in life following a divorce or during retirement when they no longer want the responsibility of looking after their own home.
It is a sign of how ‘permanent’ renting has become the norm to many, with longer term tenancies of three to five years now commonplace on BTR schemes. Investors have certainly recognised the opportunities in this market in recent years, turning away from the high-rise apartment blocks in already-saturated city centres and instead putting their money into smaller-scale developments, close to schools and green spaces.
As renting is no longer seen primarily as a stop-gap on the way to owning a property, we need to think seriously about how to foster a sense of community on brand new BTR schemes. Housebuilding firms, selling homes on the open market, understand the challenge of creating cohesion from scratch, which is why developments are generally designed with amenities, parks and social spaces.
Clearly, the longer people stay in a rental property, or any property, for that matter, the more likely they are to connect with their local area. Community spirit grows organically over time as people make friends with their neighbours, meet other parents on the school run or bump into other dog walkers and joggers. BTR developers play a key role in laying the groundwork for this to happen, and there is a strong commercial incentive for them to do so.
Tenant churn is a problem for landlords, whether corporate or operating on a smaller scale, because of the clean-up and repair costs that follow once someone has moved out. Linked to this is the fact that a short-term tenant may take less pride in the property, and development as a whole, if they are only staying for a few months. At the very least, they tend to have less of a stake in their community so are less likely to get involved in the activities that make the area more attractive.
Our properties are let at a rate that reflect the quality of the finish, accessories, full range of white goods including dishwashers, as well as the fact that they are professionally managed. While they won’t be brand new forever, we must maintain every unit to the highest standard, so rents remain at the same level and investors continue to see a strong yield.
It is therefore in landlords’ interest to deliver a service that enables tenants to maintain their properties to the highest standard possible, bearing in mind they could be time-poor. At SDL Property Management, for instance, we look after the street scene and gardens, and also encourage people to arrange activities with their neighbours, including Easter egg hunts and pizza nights. We have also organised events for tenants such as summer soirees and festive visits from Santa and his reindeer.
In a world where people might work long hours, travel frequently and spend a great deal of time on their phones, it is easy to forget that many still crave community spirit, especially if they plan to live in their home for several years.
Paul Staley at SDL Property Management