At the UK Living Sector Update, hosted by Bisnow, Yardi’s Georgie Drewery joined industry experts to discuss the resiliency of the residential market and the evolution of multi-generational living trends.

• David Mawson, CEO, Placefirst
• Zafar Bhunnoo, Co-CEO, Balance Out Living
• Bella Peacock, managing director, Greystar
• Dan Green, partner, Tri7
• Georgie Drewery, senior account executive, Yardi
• Katherine Rose, managing director, VervLife (moderator)

Despite various corners of the real estate market experiencing heavy-weight challenges amid the cost-of-living crisis, there is a growing demand for the rental sector.

Panellist Bella Peacock commented, “This is resulting in a huge supply-demand imbalance. Even in these uncertain times, if we continue delivering well-thought-out products with strong operational models, then this space is an exciting place to be.”

Zafar Bhunnoo added, “Value is demonstrated much quicker through resiliency rather than pushing rent prices 20-30% just because the demand is there. Creating a well-thought-out product and operational model is intrinsically more effective as it creates alignment with developers, operators and consumers within the industry.”

What does ‘resiliency’ mean for the sector?

A recent survey by Knight Frank found that students living in Purpose Built Student Accommodation (PBSA), as opposed to the Private Rental Sector (PRS), were paying 33% less due to all-inclusive bills.

“The Build to Rent (BTR) sector can learn from this,” said Drewery. “A recent Rightmove report also found a 36% increase in inquiries looking for inclusive bills with their accommodation. With demand for all-inclusive bills prevalent, this is a strategy that is worth implementing going forward.”

From a technology standpoint, Drewery continued, “At Yardi, our goal is to give operators the ability to manage mixed-use portfolios. Gone are the days of having disparate systems to manage BTR and PBSA portfolios – the goal is to provide operators, owners and investors with one single source to manage all.”

Amidst the volatility of the cost-of-living crisis, the panel agreed with Drewery and added that providing transparency of pricing and data is imperative to remain strategic. “First and foremost, the rental sector has a responsibility to provide a layer of price points to ensure access and entry to the demographic(s) that are looking to rent,” said Bhunnoo. “Secondly, we need to be more transparent with our consumers around how we are utilising our data to build and improve our buildings from an ESG point of view.”

Multi-generational living: A powerhouse for community

A sector once associated predominantly with young professionals seeking a stopgap before home ownership is now experiencing a broader demographic across its assets.

“Post-pandemic, we have seen a lot of people rethinking what they want out of their home, whether that be downsizing, seeking a stronger community or simply making the lifestyle choice to switch to rented,” said Peacock. “There is an increasing desire from older generations to live within communities that have access to broader, central amenities.”

With multi-generational living becoming more prevalent, the panel emphasised the importance of factoring this concept into the initial design and development. “By building smart developments that harbour communication, younger and older people living together naturally start supporting each other through community building,” said Mawson.

The panel agreed that by promoting this way of living, individuals within a development quickly become a team of people. “This is coming with many benefits,” continued Mawson. “Antisocial behaviour disappears, mental health improves and residents, overall, feel a sense of support and community in their living environment.”

Ensuring resident welfare is conducive to the resiliency of the entire residential cycle, from consumers and operators to investors alike, as justified by panellist Dan Green.

“Going forward, institutional investors must have prominence, not just on ESG in terms of energy efficiency, but also on social wellbeing. It is fundamental that operators position wellbeing at the forefront of their branding as this is innately linked to the attractiveness of their product.”

Tenancy length: Is flexibility key?

With rising rents and a lack of available stock during a surge in demand, it is commendable that the average tenancy lengths are increasing. In London alone, the average length of tenancy has risen to 25.8 months and the same can be applied to regional suburban locations, as highlighted by Mawson.

“Following Covid, our average length of stay has now moved to 35 months. In the single-family housing sector, we are seeing that people are putting their roots down and building a long-term home.”

Despite a growing demand for longer stays, tenancy lengths remain varied depending on the demographic group and lifestyle of the resident(s) in hand. For example, stays are much more transient in the student housing sector or that of someone who lives in an asset to be near their workplace.

Regardless of the resident or situation, Peacock concluded, “As an industry, whether someone wants to rent for two years, three years or equally, six months, it is fundamental that we provide that choice. People want a home they feel safe in and flexibility means security for a lot of people.”

Enhance resiliency with an end-to-end solution

Whether a developer, operator or investor, being resilient in volatile times requires time.  Technology, such as Yardi’s purposely designed residential platform can help increase operational efficiency. This includes software and mobile apps that deliver an end-to-end solution to automate processes and streamline activities for an improved resident experience. Yardi’s solutions help empower teams to free up valuable time to focus on nurturing residents and communities.