X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Stickies & Evergreen

    Institutional investors set to revolutionise private rental sector

    Some of you may have seen this already and if so, apologies.



    Source article

    Useful questions at the end of the article:

    The questions landlords might want to ask themselves are:

    Am I ready for this shake-up in the rental market?

    What impact will these institutional investors have on raising the standard of properties available for tenants?

    Are there opportunities in relation to working with an institutional investor or becoming a strong regional independent?

    0
    0
    Hi

    Saw this in my inbox this morning

    and surprise surprise a lot of this stuff comes onto the market between 2018-2020

    is this a coincidence? did Git George give the institutions a heads up years ago about this? Did they financially back the tories in the last election?

    too much 2 b a coincidence

    Good luck my LL bros
    3
    0

    you took the words right out of my mouth...

    0
    0

    Rachel Roodhardt
    Folkestone Estate Agent

    Just as the best independent butchers survived the arrival of Tesco, the best independent LLs will survive the arrival of 'corporate LL'

    If you are confident that you can offer a better product / service / price than a corporate can, you have a great chance to thrive in the next phase of PRS
    1
    1
    No coincidence and no conspiracy either.
    They have been trying to encourage inititutional investors for at least 3 years via the Build to Rent scheme.
    Now that there appears little chance of Labour messing with the housing market for a decade it would seem a better investment.
    6
    0

    Investment by large-scale investors in Build-To-Rent is set to triple by 2020, according to new research from Knight Frank.

    Knight Frank estimates that this growth will take the total investment in this sector to £50bn over the next five years, increasing the size of Build-To-Rent from 2% of the total PRS sector to 5%.

    This finding comes as part of a new report by Knight Frank, which incorporates a survey of 16 large scale Build-to-Rent investors. These investors also shared their views on where gross yields would stand around the country in 2020, with expectations that yields in regional city centre markets would settle 1.75 basis points higher than London by then, assuming that the economy performs in line with market expectations in the meantime.

    Full/source story

    To answer Helena's questions:

    Am I ready for this shake-up in the rental market?

    Most landlords are not aware of the massive changes taking place in the PRS! Property Tribes is seeking to educate all landlords on how to survive the changes. The "hive" mind can brainstorm solutions and provide encouragement and support.

    Only the educated landlord will survive imho.

    What impact will these institutional investors have on raising the standard of properties available for tenants?

    Tenants will have to deal with a "faceless" corporate. Properties will likely be small and functional. Tenants will not have anything like the choice provided by small landlords who provide quality homes.

    Are there opportunities in relation to working with an institutional investor or becoming a strong regional independent?

    I think the opportunity is to provide an alternative to institutional investors, by providing a quality, compassionate, and personal service where a relationship with the tenant is built. In other words, provide them with a "home", not a roof over their head, where they can feel secure and put down roots.
    0
    0

    If Institutional investors form only 5% of the PRS they will have almost no impact.

    So who is going to take over from the small landlord when s.24 bites combined with rising costs for epcs etc?

    1
    0
    M&G is pretty active in this area

    It's UK Residential Property Fund, which has been around since June 2013, was up to £170m NAV at the end of Q3 15

    It "targets long term annual net return of 7 - 9% with an annual 3 - 4% distribution yield. Returns are driven by net income and rental growth"

    "M&G Real Estate’s investment approach hinges on delivering stable, long-term income returns driven by methodical evidence-based insight. We believe that investment in a portfolio of UK residential real estate focused on the private rented sector could achieve this aim.

    We believe there is a compelling investment case to bring institutional investors to a market that has largely been ignored for decades. Our track record in real estate will be a key factor in delivering a professional rental model that seeks to evolve successful rental regimes from other markets to generate strong income returns."

    Much more here

    https://www.mandg.co.uk/institutions/real...al-estate/
    0
    0

    Property firm LaSalle Investment Management has completed the first two direct investments for its UK Private Residential Fund.

    The assets in Leeds and London comprise 270 purpose-built residential units and were acquired in separate transactions for £55m.

    Within the next year, LaSalle expects to invest over £500m in the residential Build-to-Rent market, on behalf of institutional investors.

    Full/source story
    0
    0

    Thanks Vanessa for showing me this link....

    Just trying to canvass opinion on whether its 'noise or a signal'....
    Read further
    https://www.gov.uk/government/https://uploads.propertytribes.com/sy...review.pdf

    London focus
    it seems to me as the institutions either need to get their modelling right and meet the market price... Or the government need to legislate for a new class of residential accommodation through the planning system. As they are not willing to invest in London at the marginal market price.
    - Is there real anecdotal evidence of their presence ... (Not 50 units here or there)... I mean impact...
    (GO is impacting adversely private LL who with all the challenges can still grind out a profit..)
    So ...my question is... If GO is successful, will these institutions meet or are they willing to meet the shortfall...?? Or will rents just adjust..... Any views or comments could be useful....
    0
    0
    The new chief executive of Grainger has started setting out her company’s Build To Rent strategy.

    Helen Gordon has told the Sunday Times that Grainger will make significant inroads into the Build To Rent sector - a further announcement is expected later this week - and will offer tenants leases ranging from six months to three years with unspecified “rights to renew” tenancies.

    She anticipates that Build To Rent will appeal not just to classic younger ‘generation rent’ tenants but to older professionals, as she calculates that the overall number of people renting privately increases from the current 4.0m to 7.2m in the next decade.

    Full/source story
    0
    0