With the Government introducing a raft of policies aimed at curbing buy to let and promoting homeownership, the private-rented sector (PRS) has been forced into change. Coupled with an affordability crisis, particularly in London, there is new emphasis on delivering affordable rental accommodation. Since my first project, a £212k house share in the Royal Docks, my business model has been based on improving affordability by using space more efficiently. Today, my strategy centres on delivering micro-apartments and co-living schemes.
Micro-apartments have long been touted as an obvious solution to providing more affordable private accommodation, however, planning restrictions have prevented delivery at scale. The nationally described space standard means that planners, councillors and voters can easily argue that small apartments are ‘sub-standard’ regardless of customer preferences, design efficiencies, specifications, technology, or shared facilities – making new-build a no-goer. However, as space standards don’t apply to conversions, we’ve taken advantage of office-to-residential permitted development rights to deliver over 400 micro-apartments in just over three years.
The innovative design of our apartments, which utilise space more efficiently, enables investors to offer new homes at lower rentals and with lower utility bills (assisted by our Nest smart thermostats and Evinox efficient heating systems) than typical new-build in the same locations. Monthly outgoings are further reduced by our deal with Zip Car, which provides reduced rates car hire, as well as our own low-cost Brompton bike hire scheme. Of course, the unit sizes are smaller but the addition of extensive resident facilities mean our residents spend more time outside of their apartments and are happier to compromise on space if it means they can afford to live in a great location.
It’s a model that has proven popular with young professionals who spend a lot of time out of the home – working, networking, playing sport, or visiting friends. Community is increasingly important in society today and we encourage our residents to get to know one another in our shared community spaces. Whether it’s enjoying the electric BBQ on the Sky Garden of Green Dragon House or playing a game of pool in the Residents’ Lounge, the opportunity is there for them to venture out of their apartments and interact with neighbours – fostering long lasting friendships and adding to their ‘living’ experience. Residents also like the hassle savings that come with having shared entertainment spaces cleaned and maintained for them, together with our drop-off and collect dry cleaning and laundry facilities.
Co-living is essentially student-type shared accommodation but for rent to young professionals, not students. Young professionals love the campus style experience that they enjoyed so much in their student days and are more than happy to share living areas. There are a number of successful co-living schemes in London, however, as it stands, if you want to develop new-build co-living accommodation, you have to apply for Sui Generis student accommodation and then seek to amend it locally to allow it to be rented to non-students. The planning risk, as well as the length of time needed to get a two-stage consent, makes the schemes difficult to fund. And impossible in areas that don’t have enough students despite the intention always being to rent to non-students.
All-inclusive en-suite rooms in London are available from around £195 a week. Residents share kitchen and living spaces but often benefit from communal resident facilities, which can include cinemas, bars, gyms, games rooms and even libraries.
Following several encouraging meetings with the Government to discuss the national space standard and co-living, we are very hopeful that both issues will be reviewed in the forthcoming Housing White Paper. Until then, we’ll continue to do our best to deliver private-rented accommodation that’s genuinely affordable to young people, both in London and the rest of the UK.
If you are interested in renting one of our apartments, call Inspired London on 020 7476 7001 or visit www.inspiredlondon.com to view availability. Or if you are an investor looking for a buy to let, call the sales team at Inspired Homes on 020 8688 6552 or visit www.inspiredhomes.uk.com for information on our developments.
Martin Skinner, Chief Executive at Inspired Asset Management and Inspired Homes