Adapted and accessible properties - the next big thing for the PRS?
Adapted and accessible homes enable people with physical disabilities or sensory impairments to live more independent and connected lives. The UK housing market is failing to meet the demand for these types of homes, particularly in the PRS. Quite apart from wheelchair user tenants, they’re a smart investment strategy as (1) the UK has an ageing population and (2) accessible design is inclusive, and so these assets will always appeal to a larger target market. Good news for upward and political meltdown trends alike!
For buy-to-let landlords, understanding and participating in the massively underserved, accessible PRS could increase your yields: longer tenancies, minimal voids and turnaround costs and fees, loyal tenants who value what you offer, and possible help from the Disabled Facilities Grant for adaptations.
Tenant demand and affordability
1.8 million people have a need for accessible homes, but it’s like searching for a needle in a haystack. Half of the 448 wheelchair user household respondents surveyed by Abode Impact were actively looking for a home to privately rent. But over 90% of all respondents had experienced barriers to accessing the PRS.
This shortage in this type of housing is mainly due to the lack of awareness in tenant demand, as well as a common misconception that people living with disabilities are wholly reliant on social housing and financial support. The statistics speak for themselves. 700,000 households in the UK, requiring accessibility features in their homes, are in the top half of the income distribution. 360,000 households have savings of £12,000 or more and the number of people requiring accessible housing features is set to increase by as much as 59% by 2021 (from 2016).
The majority of the UK population will search for their next home online and there is a plethora of estate agents to meet this demand – but they are also failing to cater for people looking to rent an accessible home. But the market is starting to wake up, with the likes of Rightmove looking at ways to raise awareness of accessibility grants that are available to landlords.
A ripe market
The term ‘purple pound’ refers to the collective spending power of disabled people and their families – worth nearly £249 billion to the UK economy. You only need look at AirBnB’s decision to acquire Accomable to see that the purple pound is strong currency. Accomable was set up by two friends with Muscular Atrophy to address the difficulty disabled tourists face in finding accessible places to stay. This market alone is worth £12 billion a year to the UK.
Accessible PRS has the potential to be the next big thing in PRS. As buy-to-let investment becomes less attractive, due to regulatory and taxation changes, landlords are looking for smarter ways to get the most out of their property investments. To date it’s been extremely hard for disabled people to find the right property to rent. When they do find the right home, it will be highly unlikely they will want to move again. Should the landlord wish to sell up, then the tenant may even decide to buy the property from them, saving unnecessary cost and hassle for both parties.
Abode Impact, bringing accessible property to the mainstream