What is build to rent and how it works

In recent years, Build to Rent (BTR) has become one of the fastest-growing trends in the housing market – and for good reason. As property prices rise, lifestyles evolve and flexibility becomes more important than ever, many people are opting to rent instead of buy. The build to rent model responds to this shift by providing modern, high-quality homes that are purpose-built and professionally managed specifically for renters.

Unlike traditional rental properties, BTR developments are purpose-built communities that combine modern design, on-site amenities and long-term management, creating a seamless living experience for tenants. From young professionals seeking convenience and community to families looking for stability without the commitment of ownership, build to rent appeals to a wide range of renters.

In this post we will explore what build to rent is, how it works and why it appeals to renters, developers and investors whilst exploring features, benefits and future opportunities.

Table of contents

• Defining build to rent
• Build to rent vs traditional rentals
• How does build to rent work?
• Key features of build to rent communities
• Benefits and challenges of build to rent
• The future of build to rent
• Ready to explore build to rent?
• FAQs

Defining build to rent

Build to rent developments are residential communities designed exclusively for the rental market. Unlike traditional housing schemes which are built for sale and often fragmented across private landlords, BTR developments are held under single ownership and managed with long-term renters in mind.

This means the product, the lease structure and the service experience are all designed to meet tenant expectations from the outset. Properties are maintained by dedicated operators, lease terms are clearly defined and amenities are thoughtfully integrated to foster community and quality of life.

Build to rent vs traditional rentals

While both models provide rental accommodation, their structure and intent are significantly different. BTR schemes operate under a single, professional landlord focused on delivering a consistent, high-quality living experience. Traditional rentals often vary in quality and service depending on the individual owner.

Feature	Build to Rent (BTR)	Traditional PRS
Ownership	Single institutional landlord	Multiple private landlords
Management	Professional, centralised team	Varies by property
Lease terms	Transparent, flexible, long-term options	Inconsistent, often short-term
Amenities	Built-in shared spaces and services	Limited or absent
Resident experience	Focused on convenience and community	Dependent on individual landlord
Data and reporting	Portfolio-wide visibility and KPIs	Fragmented across owners

Related reading: Best way to collect rent

For landlords and leaseholders: Lease negotiation strategies guide

How does build to rent work?

BTR follows a distinct lifecycle, beginning with the design and construction of homes purpose-built for long-term renting. From funding and development to operations and tenant engagement, each stage is carefully planned to ensure stability, efficiency and satisfaction.

Modern BTR operators rely on technology, such as property management software platforms and resident portal software, to manage the full stack of operations, from leasing to community building.

Planning and development stages

At the outset, developers assess demand, location suitability and operational strategy. Properties are designed with efficient layouts, robust materials and shared amenities that support lifestyle and longevity.

Community features like lounges, co-working spaces and bike storage are planned from day one to encourage social interaction and reduce churn.

Financing and investment models

BTR is primarily funded by institutional investors such as pension funds, insurers and real estate investment trusts. These groups seek long-term, inflation-linked rental income and asset appreciation.

Funding models may include forward-purchase or forward-funding agreements with operators securing financial returns through occupancy, brand strength and tenant retention.

Recent market trends show a strong appetite for BTR investment, particularly on brownfield sites where planning policies now encourage higher-density rental delivery.

Property management and services

Professional management is a cornerstone of the BTR model. Tenants benefit from consistent communication, proactive maintenance and onsite support.

Services may include concierge desks, parcel management, cleaning, maintenance response and resident engagement events, all of which are tracked, optimised and delivered through digital systems.

Key features of build to rent communities

BTR communities blend smart design, shared amenities and integrated technology to offer a seamless living experience. Whether it’s a gym, a garden or a digital payment platform every element is built to support a modern, connected lifestyle.

Amenities and shared spaces

Shared amenities are central to community life in BTR developments. Typical features include:

• Fitness centres and yoga studios
• Roof terraces, gardens and BBQ areas
• Co-working lounges and meeting rooms
• Parcel lockers and secure bike storage
• Family zones and pet-friendly facilities

Some developments also offer curated programmes such as social events, wellness sessions and local partnerships to build a sense of belonging.

Lease flexibility and transparency

Longer leases, often up to 3+ years are common in BTR. Many providers also offer shorter, flexible tenancies with break clauses.

Tenants benefit from transparent pricing, clear escalation clauses and bundled utilities or broadband services. Some BTR operators offer deposit-free options to reduce upfront costs.

Technology and resident experience

Technology underpins the modern BTR resident journey with digital apps simplifying move-in, maintenance requests, rent payments and event bookings.

Smart energy systems and building sensors improve efficiency and environmental performance. Resident portals centralise updates, feedback and communication, creating a streamlined living experience.

Learn more: Resident portal software

Benefits and challenges of build to rent

Build to rent is gaining traction across the UK for good reason; it offers a compelling proposition for both residents and investors. But while the benefits are significant, successful delivery depends on thoughtful planning, professional management and a long-term commitment to operational excellence.

Advantages for tenants

For tenants, BTR offers a more secure and predictable rental experience. Longer leases, often with built-in flexibility provide peace of mind and greater stability, especially for those seeking a long-term home. Maintenance is handled quickly and professionally by dedicated teams, reducing the frustration often associated with ad hoc landlord arrangements.

Residents also benefit from high-quality amenities that support modern lifestyles. Onsite gyms, communal lounges, parcel lockers and co-working spaces create a sense of community while enhancing day-to-day convenience. Digital services such as resident portals and mobile apps make it easy to manage rent payments, submit maintenance requests or stay updated on building news.

Location is another key advantage. BTR schemes are often situated near transport hubs, employment centres and local amenities, reducing commute times and enhancing quality of life. With professional oversight of cleanliness, security and communal areas, tenants know exactly what to expect and who to contact when support is needed.

Advantages for investors and developers

From an investment perspective, BTR offers the promise of stable, long-term rental income. Designed and managed as long-hold assets, these developments generate consistent returns, often linked to inflation, making them especially attractive to institutional investors.

Capital appreciation is another draw. High-quality, professionally managed developments typically hold their value over time and benefit from increasing demand. Operators can also scale portfolios more effectively through brand control, standardised systems and consistent service delivery.

Technology plays a central role in delivering operating efficiencies. With integrated software tools managing everything from leasing to maintenance, BTR portfolios can reduce overheads, streamline reporting and improve decision-making. As demand for high-quality rental housing continues to grow, developers and investors have a strong opportunity to meet market needs with a differentiated offering.

Potential risks and barriers

Despite its strengths, BTR is not without challenges. High upfront construction and financing costs can create barriers to entry, especially in urban locations where land values are high. The financial models must be carefully structured to ensure long-term viability.

Planning approvals can also pose delays. The complexity of local authority requirements, varying by region, may extend timelines and impact return on investment. In some markets, affordability is a concern; premium rents must be justified by value and operators must balance quality with accessibility.

Regional demand must be carefully assessed. While many cities show strong potential, economic fluctuations or local market saturation can impact leasing velocity and rental growth.

That said, the policy environment is evolving in BTR’s favour. Ongoing government support for brownfield development and the diversification of housing tenure could unlock new opportunities and accelerate planning processes, making it easier for developers and investors to deliver much-needed housing at scale.

The future of build to rent

The build‑to‑rent (BTR) sector has matured into a meaningful part of the UK housing system and the next few years promise even more transformation. While London remains a key focus of activity, the real momentum is increasingly regional, with growth accelerating in cities such as Birmingham, Leeds and Manchester. Institutional investors, planners and operators alike are treating BTR as a long‑term strategy rather than a short‑term experiment.

In the twelve months to Q1 2025, the number of completed BTR homes grew by 16 %, reaching a total pipeline of approximately 286,936 homes either completed, under construction or in planning.

The sector is expecting record investment in 2025 and around 60 % of units under construction now lie outside those core markets, signalling the increasing importance of regional developments.

Despite its rapid rise, BTR still accounts for a relatively small share of the total UK private rented sector. Estimates suggest only around 2–3 % of rental homes come from purpose‑built BTR stock. That means significant room for growth remains. Some projections suggest BTR could eventually represent 30–35 % of the private rented sector, which would require around 1.7 million homes built under this model.

However, realising that ambition will require addressing key constraints: high build costs, planning delays, regional demand depth and affordability pressures. Successfully scaling BTR will mean balancing premium amenities with efficient operations, adapting to multiple markets and ensuring rental offerings remain accessible to a broad renter base.

Ready to explore build to rent?

If you’re developing, investing in or managing a BTR portfolio, MRI Software can help you bring everything together.

Use our build to rent solution to oversee the full lifecycle, from planning and leasing to services and engagement.

Combine our resident portal software with a property management software platform to streamline every aspect of your operations and deliver a consistently exceptional resident experience.

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