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Potential in private rented market outside of London

Three-quarters of England has the potential to support developments built for private renting, EC Harris has found.

Until now, developers and investors believed build-to-rent was only viable in London and its surrounding areas, according to an EC Harris report.

Pushing the Boundaries, launched by EC Harris with Hometrack, said areas such as Brighton, Bath, Warwick and York were listed as some of the locations for build-to-rent to potentially function without any form of land subsidy or other support.

The report said that build-to-rents would be viable in 53 per cent of all council areas in England and of these, 43 per cent were outside of London.

It added that by cutting property sizes by 10 per cent and building costs by 5 per cent, 74 per cent of council areas would be suitable for build-to-rent schemes.

The report highlighted that while returns on investment may be more modest in London than elsewhere in England, with a growing economy and greater certainty over job security, the capital was often viewed as a safe investment.

However, EC Harris head of residential Mark Farmer told Construction News that benefits could be found outside of London from low land value, coupled with strong employment rates in certain regions.

He added: “We wanted to open people’s eyes to the fact that if you look at how you can optimise the scheme and understand where the viability exists with what a developer wants and what the investor wants, then you don’t have to be fixated on London and the South-east.”

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