Is this a Solution to the Housing Crisis in the Developed World?
The financial crashes of 1998 and 2008 have been compounded by the economic fallout resulting from the Covid-19 pandemic. Quantitative easing worldwide coupled with cheap borrowing has led to an explosion in real estate prices in what were once the World’s most affordable and desirable locations. The major cities of Australia, New Zealand and Canada have seen remarkable rises in living costs centred around inflated real estate prices. This has a knock-on effect on those who wish to rent homes and has led to unprecedented levels of homelessness. Governments are failing to find solutions to this crisis, but perhaps some light is emerging at the end of the tunnel.
A new approach to the housing crisis?
As rental properties become less affordable and more scarce, people are starting to turn away from the traditional rental model and look towards alternatives. Building or buying a house has effectively been priced out of the budget of many people. As a result of this, Australians are increasingly considering alternatives such as build to rent (BTR) apartments. BTR developments are common and popular in Europe. They are designed and built to suit the needs of renters and offer amenities to match such needs.
The benefits of BTR developments.
BTR developments offer renters peace of security and long-term rental stability. Leases are long and can be easily extended and payment options are flexible. Property management professionals and maintenance staff are always available. Many BTR apartments are designed around communal living and incorporate various shared facilities such as lounges, gyms, swimming pools and co-working spaces. Outdoor terraces and cooking areas help to reinforce the idea of community-based living. Living in such developments could counteract feelings of isolation common to the modern urban environment. This is a vision of a new domestic future where even pets are welcome, and renters are free to decorate and make internal changes to suit their own tastes.
So, what are the aims of BTR developments?
The main aim of these developments is to provide renters with a place they can call home. The apartments are built in desirable locations with customised specifications and are only available on 12-month leases and will not be sold. Renters can easily upsize or downsize according to need. The aim is for renters to consider their BTR apartments as sustainable, high-quality homes for the long term. The shared amenities and maintenance services reinforce the concept of giving renters homes they can make a real investment in. Communal garden areas, cinemas, storage facilities, car parking and even bike-share options are the icing on the cake.
The hope is that BTR developments start to change the way Australians think about their housing. Renters will be able to put their own mark on their living space in the same way as if they owned it, without the financial stresses and strains that real estate ownership can entail. The Australian government is encouraging investment in BTR and are hoping that this will help to counteract the current housing crisis. With no bond payment scheme attached to these apartments the barriers to moving in are low for the next generation of Australians.