Book a demo

Let a friendly Gnomen expert answer all of your questions and take you through the system online in 15 minutes. Just choose a time that suits you.

username pass repass
CAPTCHA Image Refresh
Sales: +44 (0) 208 123 9019 Support: +44 (0) 208 629 1208

Montana H

Business Development Director

Share Facebook LinkedIn Twitter

Build to Rent growth means letting agents should explore alternatives

build_to_rent_growth_means_letting_agents_should_explore_alternatives

One of the fastest-growing parts of the private rented sector is Build to Rent, where large-scale, institutional investors pump money in to provide bespoke, purpose-built rental accommodation for tenants.

It’s a rapidly expanding and increasingly influential sector, already worth over £25 billion and set to be worth £70 billion by 2021 according to Knight Frank.

It was first introduced by the Coalition government in 2012, with a £1 billion fund to support the creation of various Build to Rent schemes. Major firms such as Legal & General, Greystar and Grainger have invested heavily in the movement, with new developments popping up across the country.

Build to Rent schemes are characterised by bespoke designs and the promise of a higher-quality living experience, with particular appeal to modern tenants in the form of concierge services, communal areas, on-site gyms, games rooms, high-speed broadband and on-site maintenance teams.

How many schemes are there?

Figures put together by the British Property Federation towards the end of last year found that there are nearly 100,000 Build to Rent units across the country either completed, under construction or waiting on planning permission.

There are more than 20,000 units which have already opened their doors to tenants, with the majority to be found in London.

However, schemes are on offer throughout the UK, including in Leeds, Southampton, Birmingham, Norwich and Bristol. Scotland has only one operational development (in Aberdeen), but activity in this sector is set to motor north of the border after a spate of recent approvals.

According to a report conducted by the British Property Federation, Savills and the London School of Economics, Build to Rent is expected to be responsible for a quarter of a million privately rented homes by 2030.

What does this mean for letting agents?

Many agents might see the rapid growth of Build to Rent as a direct threat to their business. After all, if developers are letting the properties themselves rather than selling them off to landlords or investors, you might think the need for letting agents to manage homes on a landlord’s behalf would significantly reduce.

However, agents are being encouraged to see the expansion of Build to Rent as an opportunity rather than a catastrophe. Some agents are already involved with the Build to Rent sector and there have been calls for this involvement to increase.

The opportunity for new partnerships, diversification and alternative revenue streams seem fairly obvious. As a letting agent, you could look to offer expert advice and assistance to institutional investors, manage part or all of a Build to Rent development, position yourself as a rental expert to give firms a sounding board, and build strong, mutually beneficial relationships with developers and management companies to include Build to Rent as part of your roster of services.

In much the same way as some letting agents now offer management of short-lets, whether Airbnb or otherwise, you should see Build to Rent as something different and novel rather than the competition.

Those agents who look to be early adopters, and jump on the Build to Rent bandwagon, could see the biggest rewards – especially if the figures regarding the future growth of the sector prove accurate.

What's more, there's a potential financial incentive at play, with the upcoming ban on letting agent fees to bear in mind. While the fees ban won't come in until spring 2019 at the earliest, agents are still being warned to prepare now and to find ways of replacing the revenue they are likely to lose.

Diversifying your business, seeking out other forms of revenue and forming new key partnerships could all help when it comes to offsetting the negative impact of the fees ban.

With the implementation possibly only a year away, the government has warned agents to look closely at their business models to ensure they can cope with the incoming ban charged to tenants. The opportunities – and potential extra revenue – provided by Build to Rent may be something that agents will want to give serious consideration.

A streamlined approach

If you want to offer alternative services, it will help massively if your existing processes are streamlined and working in total harmony. This will allow you to add new services to your business with the minimum of fuss.

To make this possible, you need property software in place that allows you to manage all aspects of your business, from anywhere in the world, at the click of a button. Gnomen's cloud-based property software allows you to do this, with our cutting-edge, all-in-one system letting you manage your staff, diary, customers, marketing and comms all in one place.

In this day and age, you also need a slick, highly user-friendly website to stand out from the crowd. We design beautiful websites that also work beautifully, with tailored log-in areas for tenants to keep them up to date with all the latest developments.

For more information about what we can do for you, please get in touch with us on 0208 123 9019 or book a free demo here.

Share this article

Share Facebook LinkedIn Twitter

Montana H

Business Development Director

Twitter LinkedIn

Gnomen news

The countdown to GDPR why compliance is crucial

The introduction of strict new data regulations is now only a matter of days away.On Friday 25 May 2018, the General Data Protection Regulation (GDPR) will replace the Data Protection Act 1998 and apply to all countries in the EU.As Britain is still a member of the union at this point, the new rules will be unaffected by Brexit.

> Read more

Heres why the rise in Millennial renters is a good

> Read more

professionalising the industry

> Read more

Digital futures: Why HM Land Registry is the latest to embrace tech

For a well-functioning property market, with transactions occurring regularly and with minimum disruption,

> Read more

The rollout of superfast broadband can benefit letting agents

> Read more

How can estate and letting agents avoid customer problems during transactions?

Some 54% of people who have sold, rented or bought a property in the last five years have faced problems during the process, new research from NAEA and ARLA Propertymark has revealed.

> Read more

PropTech is mainstream and that is why agents need to embrace it

Before now, there could have been accusations that PropTech was a bit of a niche market; an outside disrupter rather than part of the in-crowd.

> Read more

Is bitcoin the future currency of property sales?

> Read more

Estate and letting agents 2018 dates for your diary

> Read more

latest budget outlines britains digital future

> Read more

agents benefit as property prices London

> Read more

Fees ban draft bill: 5 key questions answered

On November 1, the Department for Communities and Local Government (DCLG) published the draft for what is to be known as the Tenants' Fees Bill.

> Read more

Property firms must come to terms with Artificial Intelligence

Property firms must come to terms with Artificial Intelligence Companies have been warned that they must get to grips with emerging, disruptive technology such as artificial intelligence (AI) or risk becoming obsolete.

> Read more

Agents need to be wary of fraudulent computer virus scams

Agents need to be wary of fraudulent computer virus scams Cyber-crime is one of the great challenges of our time, and it's something estate and letting agents need to be aware of.

> Read more

Range of lettings measures announced during party conference season

Range of lettings measures announced during party conference season The political party conference season usually springs a few surprises and it was those of us working in the property industry who this year were required to sit up and pay attention.

> Read more

MPs debate unintended consequences of proposed letting fees ban

> Read more

Busiest time of the year for letting agents almost upon us

If you are a letting agent it is likely that your workload is about to get a lot busier

> Read more

Agents urged to prepare for introduction of new data protection legislation

It might not be something you have given much consideration to but new data protection legislation is coming into effect from next year that will have a significant bearing on your estate or letting agency business

> Read more

Letting fees ban set to go ahead but no timeline specified

One of the most contentious issues in the lettings industry at present is the proposed ban on letting agents fees to tenants.

> Read more

Complaints against agents - are they on the rise

A few weeks ago, The Property Ombudsman (TPO) launched its latest annual report at the House of Lords, revealing a rise in the number of formal complaints resolved by the redress scheme as well as a record total of compensatory awards paid by estate and letting agents.

> Read more