Government urged to back build-to-rent scheme to address housing crisis

It provides more security to tenants compared to traditional renting

Government urged to back build-to-rent scheme to address housing crisis

Property investors and developers are urging the government and councils to back build-to-rent schemes in order to address the housing crisis.

Build-to-rent, a new sector in housing investment, builds accommodation for the rental market and offers tenants more security compared to traditional renting by providing longer-term tenancies – but with less uncertainty.

Paul Winstanley, head of research and consultancy at real estate services firm JLL, said that build-to-rent turns the tenant-landlord relationship into one much more similar to customer and service provider.

"That change from tenant to customer is bigger than it sounds, it's about the ethos, and it's about building a community. It's in the landlord's interest that you stay as long as possible," Winstanley said.

Read more: Residential property investors switch to a new target

Bindi Norwell, chief executive at Real Estate Institute of New Zealand, said they backed calls for increased build-to-rent opportunities to support housing affordability and deal with shortages.

“Generally speaking, build to rent property developments can offer renters increased security of tenure and higher consistency of standards than you see in traditional apartment buildings, which are 'build to sell',” Norwell said.

With a current deficit of 46,000 houses in Auckland, Norwell pointed out that the country needed to find more solutions – including build-to-rent.

Luke Van Der Broek, president and board chairman at Property Institute, aired the same sentiments.

“We have too many people sleeping on the street and not enough accommodation that's fit for purpose,” Van Der Broek said.

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