Private Rental Sector UK – Trends & Design for High Annual Yield
What is PRS – Private Rental Sector UK
The PRS, large-scale developments with purpose built, privately rented apartments, is a market that has been gaining enormous popularity and it has currently found its stride. Yet there is no reason to doubt that the Private Rental Sector UK will continue to build momentum. Funding from the centre will help, with schemes like Build to Rent demonstrating the government’s keenness for PRS as a vehicle to help meet the housing demands.
Todays’ tenant has changed and has become more sophisticated than before which calls for an urgent need for a change in terms of fresh and creative ideas and high quality. The profitability of this niche asset category depends on finding the balance between capital investment and annual yield.
Key drivers – Private Rental Sector UK
One of the key drivers for the enormous popularity of PRS is the insufficient housing offerings which considerably surpass the property demand, especially for first-time buyers. The situation is further complicated by the ever-rising housing prices in London, the South-East and other urban areas. This has led to a rapid growth in the number of renters, which proportion has been doubling ( from 15% to 30%) in some locations. The average age of first-time buyers extended to almost 40. In London alone, one in four between the age of 25 and 35 do not possess an own house, and they still live with their parents. Yet there is little consolation for renters, especially in London. Figures from January 2016 indicate that Londoners spend most of their income (nearly two-thirds) on rent.
Another issue worth considering is the fact that employers are seeking a greater flexibility from their labour force. The talent pool is now global. City-hopping professionals need to be responsive to the job market, and so short, hassle-free tenures may well prove more viable than a long-term mortgage. Graduates will also have experienced good quality, purpose-built student accommodation during their studies. Realistically, few of them will be able to buy a home in the capital or other major cities. They will expect a high standard of rental accommodation as they embark on their professional careers.
Private Rental Sector UK – Nothing new?
The PRS is not a new concept. The idea of large-scale developments with purpose built, private rented apartments flourished In the first half of the 20th century. Remarkable projects from its early stage include the Du Cane Court in Balham, south London, which in fact is the largest privately owned development in Europe. The art deco development provided 676 flats accompanied with some communal amenities. Since then, although becoming well-established in Europe, South-east Asia, the Middle East and North America, PRS has yet formed only a small part of the UK’s residential property market, making the industry a promising niche asset category
Yet, the UK government hopes to stimulate PRS as a way to unlock additional housing supply through its Private Rented Sector Taskforce and the £1bn Build to Rent fund outlined in its Housing Strategy.
Already many investors and property developers have started to demonstrate a preference for PRS schemes too. By taking advantage of such schemes, they have the chance to avoid the intense sales and marketing expenditures linked to the sales of individual units. Instead, they are developing an ongoing estate, offering steady, longer-term gains.
2016 Private Rental Sector UK Industry Trends
There is a substantial potential in the PRS industry, but similarly, to all other types of investments, it requires a clear thinking. Remember, the quality is critical. The low standard reputation of the buy-to-let sector must be substituted with service, support and facilities equal to or surpassing those on offer in the market or comparable asset classes, such as the best student accommodation.
Design guides and differentiators
In the long run, the land price will have a great impact on the positioning of the final product in the rental market. To help alleviate these possibly high costs, and guarantee continued to take up, it is profound toe PRS developers to establish differentiating factors right at the early design stage. This way their property offering will increase its value and will become more appealing to the end users.
The Mayor of London’s Housing Design Guide (LHDG) will remain a touchstone for design teams along with any local authority design requirements. However, for PRS projects, communal amenities and communal areas will require greater consideration. Amenity spaces, such as gyms, spas, business areas, libraries, cafes and crèches are considered more favourably by potential tenants. Highly popular are the areas that can be hired for private functions along with the communal outdoor spaces such as roof gardens, green areas, and quiet corners. Furthermore, A recent property trend reveals the urgent need of depersonalisation of the housing industry. Let’s not forget that it is a property industry and as it requires property developers and investors to comply with the end user’ needs and requirements. Recent research highlights the enormous demand for environments in which people can talk and interact with each other.
PRS Gym and Spa Amenities with RCH
RCH can help you increase the attractiveness of your private rental development, boosting your profits and annual yield! We have extensive market and product knowledge allowing us to design and supply innovative and creative recreational facilities, meeting the latest industry trends and market requirements!
RCH can provide exactly what you need from Gym and Spa Plans through to Equipment. RCH has a vast of experience along with rich product and market knowledge within the gym and spa industry. We provide luxury, bespoke Gym and Spa Design, Gym and Spa Consultancy, exclusive Gym and Spa Supply along with Gym and Spa Management solutions.
Give yourself and your family the comfort you all deserve! Contact RCH for your free Consultation: 020 8789 9600 or email us at info@www.rawcorporatehealth.com.