Brighter Landlording

What are build-to-rent apartments?

by Kate Watt, Marketing Manager 29 April 2021

Affordability factors and changing lifestyles are behind an increasing number of Aussies living in rental accommodation.

Where renting was once considered a temporary stop on the way to home ownership, more and more Australians are living in rental properties over the long term or even permanently.

So how is our rental market changing to accommodate longer term tenancies?

You might have heard about ‘build-to-rent’ apartments which are new in Australia but well established in places like England and the US.

These are apartments purpose-built for the rental market. They are typically funded by big institutional investors (not private landlords) who retain and operate the properties specifically for renters.

In Australia the build-to-rent sector has grown in value by 70 per cent in the past year, prompting many to ask if these developments are good or bad for the average Aussie renter?

Here’s our summary of the potential pros and cons offered in a recent analysis of this emerging trend in The Conversation.

The good points:

Done well, build-to-rent tenancies offer flexible, long-term tenancies, tenant-focused onsite management, hotel-style amenities and allowances for pets and personal touches like painting and decoration.

The challenges:

In Australia, built-to-rent apartments look like they’ll rent for 10-15 per cent more than comparable private rental properties. This presents affordability challenges and potentially pushes up rental prices across neighbourhoods which were once affordable. Government subsidies could reduce this.

So while this new form of accommodation is still in its infancy in Australia it is one for landlords and tenants to watch, as is the increasing demand for longer term rental accommodation.

Looking for a new place to call home? Check our listings for rent.

Thinking of investing? Talk to us about landlording.