High-speed broadband tops the list of essential requirements in a rented property, more so than a modernised kitchen or bathroom, according to recent research.
The study conducted by lettings agent Carter Jonas of over 300 tenants in flats and houses has revealed several key findings. One was that tenants are likely to move from a property due to relocation preferences (32%) rather than because of an issue with the property itself.
Another was that speed of response to problems in a rental property is the number one priority for tenants when dealing with a managing agent. The study also found that tenants would be willing to pay more for a newly refurbished kitchen or bathroom, and that energy efficient properties have moved up the priority list as compared to previous surveys.
Tenants were also asked which key features they would like to see in future. These included implementation of quality standards, improved energy efficiency, allowing the tenant to have more control of the property, and a reduction in fees and rents.
When asked which items were considered essential by tenants living in flats, 45% cited high-speed broadband, 38% a modern kitchen/bathroom, 28% allocated parking and 21% an energy efficient property. Next in importance were en-suite bathrooms (19%), fitted wardrobes (16%), outside space (14%), black-out blinds or curtains (11%) and a burglar alarm (10%).
The 21% who thought energy efficiency essential represent an increase from 15% in 2017. The increasing cost of utilities and rising energy prices (gas and electricity bills have risen by around 3% in real terms over the last two years to the end of 2018), combined with a heightened awareness of our impact on climate change has, no doubt, affected renters’ priorities.
When tenants in houses were asked about the importance of various amenities, 47% cited high-speed broadband, 30% off-road parking, 23% a modern kitchen/bathroom and 21% a good sized garden. Next came energy efficiency (18%), an en-suite bathroom (10%), fitted wardrobes (9%), black-out blinds/curtains (6%) and a burglar alarm (5%).
What would tenants pay more for?
Respondents were asked which features they would be willing to pay a higher premium for. This topic is especially relevant in the current climate when an ever-increasing number of build-to-rent (BTR) developments have been or are being built. There are around 143,000 units either completed or planned across the UK, according to the British Property Federation (BPF).
Research suggests that there is an associated rental premium of around 9% for the additional amenities these units offer. In which case, it is important to determine exactly which features tenants are willing to pay more for.
While the current thinking is that BTR schemes can achieve higher rents because of features such as a concierge service, communal spaces and an on-site gym, the respondents living in flats showed that these were of little added value.
Modern kitchens and bathrooms
Only 12% said they would pay more for an on-site gym and just 5% and 3% respectively would pay more for a concierge and communal spaces. However, 19% said they would be willing to pay more for a newly refurbished kitchen or bathroom.
This feature would attract a rental premium without a BTR developer having to do anything, given that most build-to-rent units are relatively new.
Nonetheless, there were some features that the average BTR development may find it difficult to incorporate. Although 14% of tenants would be willing to pay more for outside space, many schemes are flats and apart from a balcony/terrace and communal gardens, this particular feature would be difficult to achieve.
And despite 12% of respondents saying they would pay more for allocated parking, this amenity is often problematic to provide in many new developments due to space issues and wider planning restrictions.
Finally, in the previous survey, 80% of respondents living in flats said that energy efficiency was either essential or important, but only 11% would be willing to pay more for it. Yet this figure increases to 20% in respect of the house-dwellers, and rises to second on the list of features they would be willing to pay for.