With the average cost of buying a property in London at a stubbornly persistent high (despite a recent decline), young people are being forced to rethink their futures. Many have given up on the idea entirely and have accepted a lifetime of renting. While some are happily embracing it, many others are heartbroken and angry at the generational injustice.
There is one section of society, however, that's benefiting nicely from our plight – the build-to-rent sector, and new research highlights the extent of its growth in the capital. There are now close to 55,000 built-to-rent homes in London, which accounts for more than half the total number in the UK.
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The research by Savills for the British Property Federation, reported in the Standard, shows the sector is flourishing and suggests it's only likely to get bigger if the current situation – too few homes that are too expensive for young potential buyers – continues. With 60% of Londoners forecast to be renters by 2025, according to a PwC forecast, there will certainly be demand.
Built-to-rent homes are a relatively new concept in the UK, but property developers are already switching from building homes for sale to building rental homes because they're seen as a more reliable source of long-term income, as the Guardian reported recently. Some even believe these purpose-built properties could be the solution to the housing crisis.
There are many built-to-rent apartment schemes already in London, including the East Village in Stratford (formerly the athletes' complex during the 2012 Olympics), and many others underway. Elephant and Castle is set to get 600 flats for rent, Newham is getting more than 1,000 as part of a larger development, and 1,500 will be built in Bermondsey, the Standard reported.
While built-to-rent homes may sound like a secure, sustainable living option for young people, in reality it’s only the wealthiest – salaried professionals from the UK and abroad – who can afford them. And even those who can afford them will find it difficult to put away money for a deposit at the same time (if that’s their aim).
A one-bedroom flat in Harrow, northwest London, is currently being advertised at £2,005 a month, while a three-bedroom property in Wembley, not too far away, is £3,595 a month. They may be the size of a postage stamp, but the recently-announced micro flats sound more appealing, tbh.