Article | Creating Resilience

Is there a link between rents and resident satisfaction in the Build-to-Rent sector?

March 21, 2023 5 Minute Read


This article explores the premium that Build-to-Rent (BtR) schemes attract, as we, in partnership with HomeViews, look at the drivers of those premiums by focussing on resident satisfaction within the sector. This article gives insight into the potential link between BtR property rents and resident satisfaction ratings.

We compared rents from 16 operational BtR schemes across London with their resident satisfaction scores, generated by HomeViews verified reviews. For each scheme we considered both the actual rent, and the premium to the embedded rents in the respective borough. Along with the overall score, we also analysed resident ratings across different categories as defined by HomeViews. These are facilities, design, location, value, and management.

Rents vs. Ratings

The results show that there is a positive correlation; schemes with higher rents generally reported a higher level of satisfaction and had higher resident ratings. This may be partly self-selecting, with higher rents reflecting a higher level of amenity for example. The top three developments for achieved rent averaged a facilities rating of 4.7, compared to a rating of 4.0 for the three lowest-placed developments.

Figure 1: Blended rent and resident satisfaction score

Figure 1

Source: CBRE, HomeViews

When analysed by category, the strongest correlation between rent and satisfaction was with design. This may reflect changing lifestyles since the COVID-19 pandemic, as tenants increasingly value well-designed homes. Our Global Live-Work-Shop Report highlighted that high-quality homes with dedicated space for working from home, are among the most important factors when selecting a property. The top three developments for achieved rents averaged a design rating of 4.8, all located in Canary Wharf, compared with an average of 4.3 for the three lowest placed.

There was also a strong correlation between achieved rents and the satisfaction scores for both facilities and location, with better located schemes providing good facilities able to charge higher rents. Those schemes with the highest rents averaged a facilities and location rating of 4.7 and 4.9, respectively. Conversely, those with the lowest rents averaged 4.0 and 4.3 for the same respective categories. The chart below shows the different facilities offered across the schemes charging the highest and lowest rents in our sample.

Figure 2: Comparison of facilities provided

Figure 2

Source: CBRE, HomeViews

Consistent BtR Management

In contrast, there was almost no correlation with the ratings for management. This category generally scored highly across all schemes, indicating that all BtR developments are performing well in this area, regardless of rental level. The professionalised management of BtR is a large driver of residents into the sector.

These results were mirrored when looking at the premium to the embedded rents in the respective borough Overall, the schemes attracting the highest resident ratings were generally positioned at a higher premium to the local market. Here, the strongest correlation was again in the design category, indicating that high-quality design is a key determinant of achieving a high rental premium.

Figure 3: Difference in BtR and average borough rents and resident rating

Figure 3

Source: CBRE, HomeViews, Realyse

Explore HomeViews 2023 Build to Rent Report to find out more.