With the private rental sector constantly expanding in the UK, tenants are changing the way that they think about their homes. Rental accommodation is shifting from being a product that tenants purchase, to a subscription-style service that they consume.
This is the latest move towards the subscription society mentality that services such as Netflix and Spotify have created and developed.
Jonathon Ivory, of build to rent operator Atlas Residential, notes that this evolution to a subscription-style service mirrors that of the rental sector in the USA. He believes that this type of living can accelerate the experiential elements of renting in the UK.
The UK’s private rental sector continues to boom, now accounting for 20% of all households (totalling around 4.9m homes in England, according to the latest English Housing Survey).
The sector itself is also changing, as Government reforms with tax changes and regulations have made buy-to-let a less attractive investment option for landlords.
According to the Royal Institution of Chartered Surveyors’ (RICS’) July 2018 survey, 22% more respondents reported declines in new buyer instructions, marking the eighth consecutive quarter of decreases. At the same time, however, build to rent is coming to the fore, and resulting in changing customer perceptions and expectations.
Nevertheless, build to rent is still a fairly new concept in the UK; many private tenants would be unfamiliar with the term. But word is spreading among renters regarding new developments that come with a host of added amenities, from communal lounges to roof gardens. Thus, although many tenants aren’t familiar with the term build to rent, they are beginning to understand the concept.
And, just as we’ve seen consumers move towards a subscription-style service with their television and music commitments, they are now looking for this in other areas of their lifestyle.
Indeed, Netflix and Spotify have paved the way for a fresh take on the private rental sector, with build to rent seeking to provide superior facilities and amenities that have a subscription-style service at their core.
This change may be beginning to mark a fundamental shift in UK rental accommodation; as more build to rent developments emerge, tenants’ expectations will continue to change.
Not only can residents in these developments enjoy on-site gyms, cinemas and barbecue areas, but they also often have staff available to cater to their every need. This is a prime example of how rental accommodation is moving from being a product, to becoming a subscription-style service.
For instance, contact with a landlord used to be quite a rare thing for tenants, only taking place at contract signing time and if something went wrong with the property. Even then, renters may be more accustomed to communicating with their letting agent, instead.
Now, staff are front and centre of build to rent developments, available for everything from signing for deliveries, dealing with queries and arranging any required maintenance work. Their presence is playing a key role in moving rental accommodation from products, to something more closely resembling a subscription-style service.
Tenants will appreciate having customer service at the heart of their rental accommodation. This builds a cohesive lifestyle experience for the renter, rather than a faceless product.
For landlords looking to cater to this emerging new tenant type, it’s important to create a home that has a character of its own, backed by a superb, subscription-style service offering, which may be becoming the future of rental accommodation in the UK.
Although you don’t have to offer state-of-the-art facilities, do think about what your chosen tenant type might want in their property – for example, young professionals will covet high-speed internet, while families with children will be looking for as much space as possible for their money.
Focusing on providing quality rental accommodation, with a tenant-focused, friendly service, will be a sure-fire way to adapt to the changing needs of the UK’s renting population. And, remember, tenants want nothing more than to live in safe, secure housing, so always stick to your legal responsibilities as a landlord.
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