From New York to the transformation of the London’s former Olympic Village, the integration of the build-to-rent model into communities has been in ascendency for more than a decade.
However, in Australia, build-to-rent represents a product still very much in its infancy.
This brings great opportunity to get the long-term viability, design quality, and community balance right from the start.
Through the Suburban Land Agency (SLA), the ACT government is committed to bring this innovative housing solution to Canberra.
Canberra has high rental yields, low vacancy rates, high median rents, high weekly household incomes, and a stable workforce—combined they present real possibilities for build-to-rent.
Rental vacancy rates have remained around 1 per cent for the past 10 years due to strong population growth, low unemployment, high average wages and a transient population.
The market fundamentals for the Canberra rental market appear to be favourable when compared to Sydney and Melbourne.
^ Source: ACT SLA
A market sounding process is under way through the SLA. It is the first step in bringing build-to-rent to Canberra.
This clearly acknowledges that for investors, community housing providers and developers, it is paramount that the model is right from the start.
So, rather than create policy first, the ACT government wants to hear directly from the experts about any financial incentives and design guidelines that will make build-to-rent, including affordable rental, viable and sustainable.
“One big thing is security of tenure. It’s a real opportunity around build-to-rent that doesn’t often get discussed,” executive director of the ACT government’s built form and divestment Nicholas Holt said.
“Giving tenants more control over their tenancy arrangements and their opportunity to stay longer in a dwelling, rather than that power resting with the building owner.
“This is also a good thing for operators and especially investors.
“Because build-to-rent is run solely on relatively low margins, you need to retain your good tenants as long as possible.
“So, it’s actually an attractor for tenants and operators themselves, because it supports both parties.”
Build-to-rent is a different rental model and there is that community building aspect, Jessica Hillcrest, program manager housing choice of the SLA, said.
“This fits very closely with SLA’s commitment to create great places where communities thrive.
“It encourages people to live there for longer. They have the opportunity to personalise their space, they get more sense of ownership, and that adds to the feeling of community.
“Making it a more attractive model to develop in inner city areas. There are more benefits for the broader community than a standard rental model.”
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