Build To Rent in Greater Manchester
The strength and popularity of the Greater Manchester single-family Build To Rent sector has been revealed by new research by Manchester agency Ascend, in association wth the BTR trade body called the Association of Rental Living.
Ascend is the UK’s largest third-party operator of single-family BTR and manages two-thirds of the entire asset class, holding the largest set of live operational data for the sub-sector. Its research draws on blended data across all of the stabilised SFR schemes under Ascend’s management, alongside additional inputs through their partnership with Experian’s Mosaic platform and use of Zoopla’s reporting suites.
As of the end of Q1 2024, the average SFR rent in Greater Manchester was £965, representing 27.9% of the typical household’s income of £47,900, well below Homes England’s 35% guidance for affordability.
As a comparison with home ownership, the average SFR household would be eligible for a £225,000 mortgage with monthly repayments of £1,400, equating to 35% of their income.
The research also claims to dispel misperceptions of the sector’s typical resident.
Mean occupier age is 32, with an average of 1.8 residents on the tenancy in each home and 62.5% of households have no children. And while the typical tenancy is 2 years and 10 months, this is impacted by the relatively low age of many properties; across Greater Manchester, 44% of SFR residents have lived in their homes for more than three years. SFR residents are younger, more likely to be without children, and living in the same homes for longer than previously thought.
Ascend claims that the attractions of SFR – a superior product, better service and greater security of tenure – are driving strong demand from residents for such homes. Occupancy levels across the schemes under Ascend’s management stood at 98.7%, 99% of rents were collected over the course of the year, and 75% of households renewed or remained in their property beyond the initial tenancy period.
The SFR sector – most commonly new-build homes located within wider developments – has undergone a period of accelerating growth over the past decade. Greater Manchester has been a major focus of institutional investment in the asset class, and is arguably now the sector’s most mature sub-market.
Other findings revealed by the Snapshot on Greater Manchester SFR include 52% of units are three-bedroom houses; two-bed houses have an average monthly rent of £865, 3-bed £1,015 and 4-bed £1,105; average household income is £47,900, slightly above the average for the wider demographic of Greater Mancheste; and that on average, SFR residents moved 37 miles to their current home
Paul Borrmann, Managing Director of Ascend, says: “This snapshot report shows the success of the SFR market and its popularity among renters in Greater Manchester. Strong and rising rents at high collection rates, alongside long and growing tenancy lengths highlight the depth of demand for SFR in the city region, while demographic data gives the best picture yet of residents.
“A typical resident age of 32 and the perhaps surprisingly high number of households without children shows people’s preference for SFR as an active, positive choice. Residents are attracted by the superior product, more space, better service and a greater security of tenure than the wider rental sector often provides – and it is not just families but young professionals too that are embracing the advantages of SFR in Greater Manchester.”
And Brendan Geraghty – chief executive of the Association of Rental Living – adds: “The ARL recognises the profound importance of delivering homes, the delivery of SFR is very welcome and is a significant and important addition to the Build to Rent offer, particularly for families. This excellent report shows the value of SFR and the supporting data highlights the benefits of professionally managed, institutionally-backed houses built for rental. It provides strong evidence of the longer occupancy periods of renters in SFR. We look forward to collaborating with Ascend to deliver similar SFR market reports across the UK.”
View the full Snapshot report at https://ascendproperties.com/insights
