22nd Nov 2023|News|Lettings|New Homes|

Do You Know Who Your Tenants Are?

Looking to purchase your next buy-to-let investment property? Or are you hoping to put a property on the market for rent in the near future? Before you take your next step, it is important that you ask yourself who your prospective tenants are likely to be. This is critical in informing your future decisions, nailing your marketing, and even boosting your ROI. 

In this piece, we’ll be exploring what types of rental property appeal to certain tenant demographics so that you can make the most informed decision possible when it comes to your buy-to-let journey.

City Centre Flats

Do you own a flat in a city or town centre? Chances are your unit will appeal to young tenants and single working professionals looking to embrace the hustle and bustle of city centre living. 

According to Paragon Bank, the largest portion of the private rental sector is occupied by flats, with 25% of the entire sector being purpose built flats and 39% being converted flats. Another poll by GoCompare unveiled that over 47% of tenants between 18 and 24 said that living close to work or educational facilities was important to them, making city centres more in-demand for these younger demographics. Furthermore, the same demographic stated that being close to amenities such as bars and restaurants was also very important, further pinpointing the importance of central living for these younger people. It is clear that having ample opportunities to socialise, as well as having easy access to premium amenities for optimal convenience, is important for tenants within this age bracket.

Here at Centrick, we’ve even conducted our own research due for release in 2024 to investigate tenant behaviours and preferences across the rental sector. In our research, 40% of respondents aged between 18 and 24 stated that nearby leisure and recreational facilities were extremely important, directly corroborating what GoCompare found. With these kinds of amenities being predominant in city and town centres, it’s no wonder younger tenants and single working professionals are likely to opt for flats in these areas.

Sustainable New Homes

Many landlords have chosen to focus on purchasing energy efficient buy-to-let units, or retrofitting their existing rental units with eco-friendly features, especially before Rishi Sunak scrapped EPC improvement measures across the private rental sector. But what kinds of tenants will be most likely to opt for these sustainable new homes, and why?

Millennials are more attuned to social and environmental issues than ever before, making them prime tenants for eco-friendly investments. After all, having access to energy efficient features across your rental property isn’t just a great way to boost your green credentials, it’s a fantastic way to save money too. New homes tend to be more sustainable having factored in more modern eco-friendly techniques and technologies into the fabric of the building from conception – from great EPC ratings to EV charging points and the use of sustainable materials.

In fact, our own research shows that those in the 25-34 year age bracket are very likely to prioritise energy efficiency in their rental homes, with 46% of those surveyed saying it was ‘very important’ – more than any other feature or amenity. So, if you’ve recently purchased a new build or retrofitted your buy-to-let properties with modern eco-friendly features, expect to garner plenty of attention from millennials.

Houses For Families

What about landlords that own larger homes with multiple bedrooms, parking and garden space? Larger families are more likely to be attracted to more suburban housing options close to schools with ample parking for the school commute. Families are also more likely to want more space: garden space for playtime with children and family pets, and more bedrooms for growing families and storage. Cities may be less suitable for these tenants as the hustle and bustle of the city core is typically more clustered and offers less space for these family units.

Centrick’s own research, due to be published in 2024, demonstrates that these family units with multiple tenants and with 3+ bedrooms are typically occupied by 25-34 year olds. This shows that young families across the UK are more likely to demand more space from their rental units, and are therefore increasingly likely to look outside of the city core to obtain this. Furthermore, it is worth considering these families may also be more likely to be long-term renters looking for stability for their family unit, and will be unwilling to move far from good school catchment areas. So, if you are a landlord planning your next investment and wish to target this demographic, prime suburban locations and ample space could be the combination that secures you long-term renters and therefore income stability.

How Well Do You Know Your Tenants?

Do you know your tenants, what they want, and what they’re searching for? For more information on understanding rental market trends and appealing to your ideal tenant, contact the Centrick team below to schedule a rent review. Our team is here to help you achieve an exceptional ROI, diversify your property portfolio, and achieve your property goals in 2024 and beyond – get in touch!

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