Build-to-rent homes (BTR), an emerging sub-sector within the private rented sector (PRS) in the UK, could supply new housing quicker than a traditional build-to-sell approach and contribute to the housing crisis in the long-term.

A latest report from Grant Thornton elaborates on the importance and relevance of BTR market, which refers to housing stock that is designed specifically for renting rather than for sale and is typically managed by specialist operators and owned by institutional investors.

“The benefits of the BTR model include higher quality accommodation compared to the rest of the PRS, faster build times compared to the Build-to-Sell (BTS) model, regeneration/place-making benefits (job creation, increase in footfall) and improved management and service to tenants,” the report said.

The PRS in the UK is fragmented since several decades with an estimated 98 per cent of current stock owned by individual landlords or small companies. 

However, quality of such homes is an issue. The BTR model, through institutional investment, is trying to improve the standards within the PRS. There were 105,000 BTR homes completed, under construction or in planning across the UK by the end of 2017, registering an annual 50 per cent increase.

 It is estimated that over £50 billion will be invested in the BTR market by 2020.The BTR sector is growing in significance and investors are showing interest in the model.