11% PRICE PREMIUM for quality designed new build property
DATALOFT, HOMEVIEWS, 2020
16%
PRICE PREMIUM global price premium for luxury branded residences SAVILLS, 2020
DESIGN £4bn M AT TE RS
INVESTMENT anticipated in UK BTR in 2020
KNIGHT FR ANK, HOMEVIEWS, 2020
T H E VA L U E O F G O O D D E S I G N I N B T R
Great design commands a price premium in residential markets, enhances ROI and can result in faster lettings and reduced void periods. As part of the award-winning Accouter Group of Companies, AGC BTR take aspirational living to a new level.
Analysis by
QUALIT Y DESIGN AT TR ACTS PREMIUMS
11%
16%
PRICE PREMIUM
GLOBAL PRICE PREMIUM
Well-designed new build homes compared to the wider locality
Luxury branded residences SAVILLS, 2020
DATALOF T, HOMEVIEWS, 2020
3 years
12%
10.1%
ROI
DESIGN PRICE PREMIUM
Potential recovery period for cost of furnishings
Homebuyers prepared to pay for beautifully designed homes
FURNISHED HOMES PRICE PREMIUM*
DATALOF T, DRMA , LONRES, ACCOUTER
MODERN HOUSE, 2018
Against unfurnished apartment rentals across prime London LONRES, 2020
T H E VA L U E O F GOOD DESIGN IN BTR Good design attracts a price premium. As renters become more discerning in their choices there is evidence of a clear trend to renters wanting high quality and well-designed homes. The Build-to-Rent sector is ideally placed to respond.
DESIGN TOPS THE AGENDA
2X IMPORTANCE OF DESIGN New build renters consider design and quality to be nearly twice as important as second hand renters DATALOF T, PROPERT Y ACADEMY, 2020
92% TIME SPENT INDOORS PER DAY OMNIUM, 2019
4% 6.
00 K < £P5E R WE E
% 10.1
*£1,000 PER WEEK
18.1% £2,0
PE R
00
WE
EK
29. 6% £2
PE
DATALOF T, LONRES
R
,0
W
00
EE
K
+
Furnished v unfurnished apartments let across prime London
“FOR THE FIRST TIME IN THIS C O U N T R Y, W E ARE EMBEDDING B E A U T Y, D E S I G N AND QUALIT Y IN THE PLANNING SYSTEM” ROBERT JENRIC K , SEC RE TARY OF STATE FOR HC LG – Design focus at the heart of new planning reform
A GROWING SECTOR Q UA L I T Y PAY S Quality of design is at the forefront of fundamental reforms to the UK planning system and never has it assumed more importance than now, with 2020 prompting many to reassess what they need from a ‘home’. An estimated 10.7 million people are ‘uncomfortable’ living in their homes, with apartments and newer dwellings considered less comfortable than other home types (Place Alliance, 2020). It is no surprise therefore, and as has been proven in both the home buyer and branded residence sectors, that beautifully designed and furnished new build accommodation will attract a significant price premium.
WELLBEING M AT TERS Design, in terms of space allocation, access to the outdoors, and the quality and sustainability of interior fixings and furnishings plays a crucial role in supporting and enhancing our wellbeing. Even before lockdowns, UK estimates of personal wellbeing had faltered after seven years of gradual improvement (ONS, 2020). The impact of the pandemic has been significant. 37% of adults now say it is harder to relax at home (YaleRetail, 2020), and for many blended working is set to become the long-term norm, our homes also our work-space more than ever. With heightened public awareness and understanding of personal mental health, utilising quality design in Build-to-Rent will undoubtedly pay dividends. Well designed and flexible personal and communal space and facilities offer the ability to prevent isolation and create community.
It is anticipated that £4.02 billion will have been invested in the UK Build-to-Rent sector in 2020¹, with activity levels up 20% year-on-year². Rent collection has proved strong throughout 2020 and tenant demand is high. Particularly sought-after by younger tenants, the economic legacy of COVID-19 – stricter lending criteria and affordability constraints, may well force prospective first-time buyers to delay their purchase, underpinning demand for secure, flexible and high quality private rental accommodation. With over 120,000 units (70% of the current pipeline³) under construction, or at planning stage, the sector can react fastest to the changing consumer landscape.
£4.02bn INVESTMENT IN BTR IN 2020 KNIGHT FR ANK, HOMEVIEWS, 2020
“A N O T H E R T R E N D T H A T HAS CONTINUED TO GROW STRONGER IN 2020 IS R E N T E R S D E S I R E T O H AV E HIGH- QUALIT Y AND W E LL- M A N AG E D H OM E S” B N P PA R I B A S , 2020 ¹Knight Frank, Homeviews, 2020, ²BNP Paribas, Q3 2020 v Q3 2019, ³Savills, Molior, British Property Federation, Q3 2020 v Q3 2019
TOP 3 DESIGN-BASED PREDICTORS OF COMFORT
¹ based on 2-beds, including apartments furnished by AGC BTR, compared to wider E14 ² including furniture, lighting,storage and wifi
ACCESS TO PRIVATE OUTDOOR SPACE
MORE SPACE, MORE ROOMS
CELLUL AR VERSUS OPEN PL AN
Attracts an 8% price premium with 38% of renters willing to pay more for a roof terrace
26% larger: average space of apartments in the Vertus 8 Water Street BTR development over the surrounding area¹
DATALOF T, HOMEVIEWS, PROPERT Y ACADEMY, 2020
DATALOF T, DRMA
Ability to separate work from home; good environmental and physical conditions² paramount PL ACE ALLIANCE, 2020
THE AGC BTR DIFFERENCE BEGIN TO REIMAGINE Tenants across the Build-to-Rent sector are increasingly discerning in their expectations and choices and are prepared to pay premiums for products that meet their needs. Design matters to tenants; the importance of the internal, and external look, feel and ambience ever increasing in our experience-driven economy. Quality interior design is critical in creating comfortable homes where occupants feel safe, secure and happy. Research proves that furnished properties rent quicker, have lower voids, and let for less discount on their initial asking price than their unfurnished counterparts (LonRes, 2020). The BTR sector offers the biggest revolution in the housing market across the UK in decades and for savvy developers there is the opportunity to deliver a product synonymous with quality that offers a lifestyle experience. AGC BTR is the benchmark for aspirational luxury living in the BTR sector. The achieved design price premiums in other sectors of the residential market, including home buying and branded residences, have long been evident. Build-to-Rent is in an ideal position to repeat these trends.
“E VE RY SQUARE INC H WA S T H O U G H T F U L LY L A I D OUT. THE FINISHES M AKE IT F E E L A S I F W E ’ R E S T AY I N G I N A 5 - S T A R H O T E L” T E N A N T, 8 WAT E R S T R E E T
FLEXIBILITY We react swiftly to changing tenant needs; from the surge in demand for pet-friendly homes to communal home working spaces during Covid.
D E S I G N E XC E L L E N C E At AGC, we aim to provide a BTR solution by challenging the norm and pushing boundaries. With our multifaceted interior design service and award-winning team of creatives, we have built a reputation that has defined the benchmark in aspirational living.
SUS TA I N A B I LIT Y We are investing in the future, directing our efforts on measures that will deliver the biggest impacts. Sustainability measures have already seen us achieve our ISO environmental accreditation 140001, and we are committed to working towards carbon neutrality.
QUALIT Y Quality assurance is key. We are committed to choosing the most reputable suppliers, sampling the products in person and signing off all large orders with 100% confidence in the product and manufacturer. Our sumptuous beds, for example, are handmade in the UK.
V E RT U S BT R , FU R N I S H E D BY AG C BT R . H OME V I E WS , 2020
AGC is a British interior design collective with a portfolio of international award-winning interior design brands, creating the benchmark in luxury living. The Accouter Group of Companies which is home to Accouter, A .LONDON, BoxNine7, Bazaar and an innovative Build-to-Rent service, AGC BTR. Delivering world-class interior architectural and furnishings to the global property market, private clients and consumer market.
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CONTACT US BTR@AGOFC.COM
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