Recently we asked whether Build to Rent was the answer to London's housing problems.
Now business group London First has joined forces with cross-party organisation London Councils and planning and development consultancy Turley to produce a guide which says Build to Rent can have a role in solving the capital's complex housing puzzle.
The new guide, explaining the ins and outs of the Build to Rent sector, was launched ahead of this week's 30th MIPIM conference, which is taking place across three days at the Palais des Festivals in Cannes.
The report – titled 'Everything you need to know about build to rent in London' – was released last Thursday and provides a comprehensive guide of the sector, from an analysis of the number of developments in the pipeline to investment models and who lives there. It also offered a borough-by-borough examination of council planning policies regarding Build to Rent.
Among the case studies featured in the guide are Quintain's £3 billion transformation of Wembley Park, which is eventually set to deliver around 5,000 Build to Rent homes under the company's Tipi brand, and Transport for London's investment partnership.
“Build to Rent has a vital role to play in London, helping to increase supply while professionalising the rental sector,” Jonathan Seagar, executive director of housing at London First, said.
“Councils are critical in making Build to Rent a success across the capital, both in getting planning policy right but also investing in it directly as a future revenue stream.”
He added: “There is no single, simple solution to London’s housing crisis; alongside more land being made available and more investment coming forward, better and more innovative ways of building, such as Build to Rent, are critical if we are to provide the homes people need.”
The report revealed that London is increasingly a city of tenants, with the numbers renting privately increasing fast in recent years. Some 27% of London's population now live in the private rented sector, according to the report, in contrast to 21% who live in some form of affordable housing. The number of renters is anticipated to top 40% by 2025.
The report argues, however, that the quality of that housing still varies considerably, giving Build to Rent a clear role to play in professionalising the private rented sector.
Build to Rent has flourished in London in recent years, with developments springing up all across the capital, from Croydon in the south to Wembley in the north, and Hayes in the west to Barking in the East, as well as in several central locations. It has become a part of London life – something which is further backed up by the report's findings.
According to the latest figures, there are now nearly 15,000 Build to Rent homes built in London alone, with just over 19,000 under construction and more than 38,000 at various stages of the planning process.
What's more, recent research revealed that £3.1 billion was invested in Build to Rent in 2018, an increase of 33% from 2017, while £33.8 billion of 'institutional equity' is targeting investment in the sector across the next five years.
The demographic makeup of Build to Rent homes is also continuing to shift, the report found. Although the sector is well-known for offering quality, bespoke accommodation to the young professionals that London needs to remain competitive on a global basis, it is also increasingly offering homes for essential workers who run London's key services and forming part of the multi-pronged solution required to tackle the capital's housing troubles.
The Mayor’s London Plan states that London needs to build 65,000 new homes per year to keep up with rising demand from a rapidly expanding population, which is over double what’s currently being delivered. Many believe Build to Rent could help to plug that gap.
“London is becoming a city of proud private renters once again,” Councillor Darren Rodwell, London Councils' executive member for housing & planning, commented. “It’s clear that all levels of government need to support a greater diversity of the types of homes that are built in the capital, which will contribute to increasing overall supply.”
He added: “This joint research highlights the opportunities for delivering high-quality Build to Rent developments for Londoners, and boroughs are keen to help make this happen. Increasing delivery of Build to Rent housing is a vital part of addressing London’s ongoing housing crisis.”
You can read a PDF version of the full report here.