As part of our Love Where You Live research into the blossoming BTR landscape, VICI by Centrick have pinpointed 6 up and coming locations that are spearheading build to rent growth. From Northern hotspots such as Sheffield and Manchester, to major cities London and Birmingham, to cultural havens Liverpool and Southampton – here are VICI’s top build to rent hotspots to watch out for in 2024.
Manchester
Known as the Northern powerhouse city, Manchester BTR and PRS properties continues to perform exceptionally well. In fact, JLL predicts that the city will see 4% rental price growth each year until 2027, and the BTR market is similarly robust, driven by student retention and the city’s appeal to young professionals. Historically, rental values have surged over 19% in the year leading to June 2023, fuelled by increased demand and rising house prices.
Rental Trends In Manchester
Considering starting a development in Manchester? It is important to note that garden space is the most enticing feature for higher rental prices, followed by energy efficiency and parking. Positive responses were also received for private dining, meeting spaces, and pet-friendly developments.
Sheffield
Designated as the UK’s first investment zone in 2023, Sheffield is poised to receive £1.2 billion in investment over the next few years. As such, this city is attracting developers seeking reasonable land values and ready-made demand, and the appeal doesn’t just stop there – despite a 12.5% increase in rents by January 2023, Sheffield remains the most affordable city in the UK, making it a fantastic location for renters too. Here at VICI, we have launched the Sheffield BTR development at Iron Yard, which you can find out more about via the video below.
Rental Trends In Sheffield
It is abundantly clear that Sheffield is a lucrative place for rental investment, but what trends are important to renters in the region?
When asked what features they value in their BTR development, it seems that Sheffield renters value engagement, ranking lounges and socialising spaces fourth in features worth paying extra for. Sheffield residents also prioritise green and outdoor spaces, ranking these third among features they would pay more for.
Birmingham
Birmingham emerges as a key Build to Rent (BTR) hub in the UK, driven by a youthful population and thriving culture. The city’s appeal has led to increased developer interest, with notable Birmingham BTR projects like Moda on Broad Street and at Great Charles Street. As such, it is no wonder that Birmingham has attracted the most BTR investment outside London, indicating a promising future for this city and the West Midlands as a whole. Speaking of future projections, the city’s property market is expected to grow by over 19% by 2027 according to the latest JLL predictions, fueled by rising values and limited affordable supply.
Rental Trends In Birmingham
Birmingham residents exhibit a heightened willingness to pay for gym and fitness facilities, with over 40% expressing interest, the highest among the surveyed regions for Love Where You Live. BTR residents in Birmingham are particularly interested in this feature, with 44% willing to pay, compared to 17% of Private Rented Sector (PRS) residents. Despite the high perceived value, gym facilities rank 11th on the importance scale, indicating that whilst many are prepared to pay extra for this feature only 56% consider it crucial.
With such a thriving BTR sector, developers are keen to prioritise innovation and stand-out amenities in Birmingham. The bare essential facilities just simply won’t cut it in the second city – with developers providing on-site cinemas and rooftop running tracks, the Birmingham BTR landscape is unlike no other, and is truly pushing boundaries. With such innovation across the sector, it is no wonder that Birmingham’s BTR residents boast the highest Net Promoter Score, indicating exceptional satisfaction.
London
London remains a stronghold for Build-to-Rent (BTR) in the UK, with 40% of completed developments located in the capital. In fact, latest figures show that investors spent £2.7 billion on the BTR market in London alone over the past year, building 40,000 homes every year. Our research highlights the maturity of London’s audience compared to other regions.
Rental Trends In London
Contrary to some stereotypes, Londoners exhibit high levels of community engagement, with almost 88% getting along well with their neighbours. This theme of community carries through to social spaces, which rank fourth in importance to London BTR residents. London prioritises basic amenities, parking, energy efficiency, and garden space. Surprisingly, pet friendliness ranks low in importance, with only 27% willing to pay more for it. Security perception is notably high, with over 77% feeling safe in their rental property, surpassing the national average of 67%.
Another finding that runs contrary to assumption is the high cost of living in London. While 35.3% of Londoners spend over £1200 monthly on rent, 64% consider it fair, surpassing the national average satisfaction level. However, rental costs constitute a higher proportion of income for Londoners (48%) compared to the national average (38%).
Explore Our Pioneering BTR Research
Want to find out more about the bustling BTR landscape? If you’re considering developing a BTR unit in a new area, our national solutions are here to help. Download our groundbreaking Love Where You Live research using the form below to find out about the evolving build to rent landscape and what the future holds for these ultra-modern rental solutions.
