Podcast Summary
Build-to-Rent Market: Institutional Investors' Growing Influence: Private pension funds are investing heavily in the build-to-rent sector, potentially impacting small-time buy-to-let landlords as institutional investors take a larger share of the PRS market. The government's stance towards private landlords hints at favoring larger investors, but the timeline for build-to-rent's dominance is uncertain.
The build-to-rent market is growing rapidly, with private pension funds investing billions into the sector. This could potentially impact small-time buy-to-let landlords, as institutional investors take a larger share of the PRS market. The government's stance towards private landlords, with measures like the recent changes to mortgage interest tax relief, suggests a possible intention to favor larger investors. However, it's unclear when build-to-rent will overtake small landlords entirely. Rob, from this week's question, is one of many landlords curious about the future of the PRS market. Stay tuned for more insights on Ask Rob and Rob.
The PRS, build-to-rent, and institutional investment sectors will coexist: Despite challenges, the PRS will continue to play a role due to existing stock and tenant demands, while build-to-rent and institutional investment sectors grow. Their coexistence is evident in the student housing market.
The Private Rented Sector (PRS) is facing challenges but is expected to coexist with institutional investment and build-to-rent sectors. The PRS, which is often criticized and targeted for tax revenue, will continue to have a role due to the existence of a vast amount of existing stock and varying tenant demands. The build-to-rent sector, which consists of newly built units, will also grow, but it won't completely replace the PRS. The government and institutions may have advantages, but it's unlikely that private investment in the PRS will become unviable. A look at the student housing market reveals that it was once dominated by individual landlords but now includes institutional investment, illustrating the potential coexistence of various housing providers.
Competition from professional investors improves student rental quality: Competition from professional investors and institutions has led to higher quality student rentals, with individual landlords also able to benefit by providing good properties.
The student rental market has seen significant improvements in terms of quality due to increased competition from professional investors and institutions. This trend started over a decade ago and has led to an expectation for good quality rental properties for students. However, this process is expected to take longer in the normal buy-to-let market. Despite the competition, there is still a place for individual landlords who provide good quality rental properties. The rise in competition and expectations for quality may ultimately benefit tenants by pushing landlords to maintain their properties to a higher standard.
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