The renter mindset continues to evolve. And keeping up with the latest rental trends can prove tricky if you’re an asset owner with a large number of units, as the focus required to run the day-to-day operations takes up a significant amount of your time.
By 2025, the rental market will be worth £75bn in London alone, with the number of renters set to increase 122% in the next decade. Generation Rent is becoming an increasingly more important demographic in the property market, and their demands are changing.
Renting is no longer seen as a short-term option to save money for a home; today, tenants are in it for the long haul. This is reflected by the average tenancy increasing to 4.1 years. Therefore, they’re looking for homes and not merely somewhere to live.
The change of mindset poses its own set of challenges for landlords, from single-property owners to companies who own hundreds of assets. You need to keep up with renter demand by offering them the type of places they want to call home.
In this article, we’re examining the current state of play with renters and what the modern-day tenant expects from their renting experience. From flexible contracts to a genuine sense of community, this is what goes into the makeup of a modern-day tenant.
Flexibility with contracts
Even with tenancies lasting for longer, renters still want flexibility in their choices. It helps them feel more comfortable, especially when committing to expensive rental homes. You’re likely to find younger renters in their twenties keen on flexible options, while tenants over 35 may feel more at home with longer-term commitment.
However, that’s not to say that older demographics don’t enjoy the freedom that comes with flexibility. Post-pandemic, there was a rise in people seeking the nomadic lifestyle, with more people, in particular, finding joy in moving from place to place and country to country.
Since Covid, the mindset has changed somewhat (more so by force), and it will be interesting to see what happens when a vaccine is widely available, and some form of normality is restored. People with itchy feet may head back out into the world, but the current trend of people staying in homes for longer may also continue.
With higher-priced properties comes an expectancy of five-star service. If a tenant’s paying £2,500-plus per month for a home, at the very least, they will expect an efficient option for reporting maintenance issues, while easy access to their tenancy and property documents is also an expectation.
Build-to-Rent has enjoyed some success, not for its amenities, but for its high-level property management. Nowadays, tenants expect to have access to an app or desktop application where they can report maintenance issues and then track their progress.
Those living in high-end homes may even expect some type of concierge-style service, where they can ask questions on the app and book social spaces in the property. Convenience is key, and demand for a seamless way to manage their in-life tenancy will be a necessity.
We live in an environment where we expect instantaneous results, with minimal fuss – whether it’s ordering a taxi or finding our favourite TV shows on streaming sites. And this mindset plays into our day-to-day thinking and living experiences.
An increasing number of developments are promoting the simplistic lifestyle with apps where tenants can manage their tenancy. But some are going one step further, offering all-inclusive options where tenants pay one sum that covers the rental cost and utility bills.
For renters, this is highly appealing; they know every aspect of their tenancy is covered in one payment and don’t need to worry about multiple avenues of expenditure each month. As competition increases, developers should think about all-inclusive options. If they’re viable options, your building could be a huge hit with renters.
Amenities are good, but they aren’t the only answer
By now, the majority of developers have accepted that on-site amenities, such as a gym, lounge area and terrace, are primary requirements for modern-day renters. But there’s an argument they have relied too heavily on these hotel-like features without taking the local area into account.
The result is a growing number of developments – especially in London – that are left feeling soulless. This defeats the purpose of a primary renter demand: community. Big cities, in particular, see renters looking for a sense of belonging, and the developments that can match their requirements will enjoy long-term sustainability.
Coals Drop Yard in King’s Cross is a prime example of a residential development done right. The entire neighbourhood has been regenerated, offering shops, restaurants, bars and cafes that fill the area with buzz and add another dynamic.
The homes in Coals Drop Yard compliment the community, with everything coming together to offer a dynamic living experience for renters. It’s a prime scenario where the developers have looked at the bigger picture, seeing how the homes can integrate with the area where they’re located.
The neighbourhood location should play into the overall feel and look of the building. There should be an organic feel where it’s not just about amenities and an on-site supermarket. Amenities don’t equal premium. Instead, developments should reflect the neighbourhoods where they’re located to foster a genuine sense of community.
With a growing number of tenants looking for long-term living options, the emphasis on premium homes only increases. Tenants are prepared to pay more, especially in London, but they expect the level of service to match their outlay.
Modern homes with comfort cooling and high-end appliances is an expectancy, as is high-end property management. A property manager who goes that extra step and ensures that tenants enjoy their in-life tenancy will make a significant difference to their living experience.
High-end property managers mean an increase in tenant happiness, which results in longer tenancies and fewer void periods. There are many components that go into a premium home, but human service is arguably the most important.
Connecting with modern-day renters
There are no complicated equations; if you meet the primary demands of renters, your development will be in a stronger position to maximise rents and garner a reputation as somewhere everyone wants to live.
Increased renter demands is ultimately a positive aspect, as a growing number of people are looking to lay down routes in high-quality homes for longer. And for large-scale asset owners, that provides an opportunity to be the landlord that understands the modern-day renter and meets their needs.