Jan 16, 2025
What is the brightest future of rented accommodation in the UK?
Introduction
The UK’s housing landscape is experiencing a significant shift as more people turn to long-term renting. Currently around one in five UK households rent privately, and that share is expected to grow in the coming years
. In response, developers and investors are creating new models of rented accommodation that differ from the traditional private landlord with a single property. Thesepurpose-built rental communities– often referred to asbuild-to-rentdevelopments – consist of multiple homes under one ownership and management. This approach is transforming renting into a more service-oriented and community-focused experience, with parallels in global markets (for example, large multi-family apartment complexes in the US or co-living communities in Europe). The following report explores how these single-owner, multi-home schemes could shape the future of renting in Britain, highlighting their efficiency, sustainability, and potential to blend renting with ownership for residents.
Rise of Single-Owner Multi-Home Developments
A modern build-to-rent apartment complex along a riverside. These developments are owned and operated by a single entity and designed for long-term renting, offering professional management and amenities.
An increasing number of residential developments in the UK are built with the intention that one company will retain ownership of all the homes and rent them out. These single-owner, multi-home developments (often new apartment blocks or entire housing estates) are typically backed by institutional investors (banks, insurers, property companies) and professionally managed. Unlike traditional housing built for sale, build-to-rent projects are designed for long-term rental from the outset. They usually provide a range of on-site amenities and a more standardised tenant experience. For example, many such developments include features like gyms, co-working spaces, communal lounges and roof gardens for residents. This strategy not only adds value for renters but also fosters a sense of community. Research suggests tenants strongly appreciate these offerings – people moving into build-to-rent schemes are often willing to relocate farther than those choosing conventional rentals
. While currently only about 2% of the UK’s private rented sector is comprised of build-to-rent units, this share is projected to rise to over 20% in coming decades
. In global terms, similar trends are evident: cities like New York and Berlin have long had large apartment complexes under single ownership, and new co-living ventures from Silicon Valley to Singapore also show the worldwide appeal of professionally-managed rental communities.
Benefits for Tenants: One immediate benefit of these developments is consistency and quality of service. With a single dedicated owner, maintenance and management tend to be more reliable – there’s an on-site or readily available management team, and standards for property upkeep are set across all units. Tenancies can be more secure as well; corporate landlords often offer longer lease options and predictable renewal terms, in contrast to individual landlords who might decide to sell. Additionally, living alongside hundreds of other renters in a well-planned community can increase social interaction and neighbourly solidarity. Many build-to-rent sites actively organize tenant events, from fitness classes to movie nights, to build a friendly community atmosphere. As one industry review noted, these developments provide amenities and social spaces that encourage a sense of community not typically found in traditional private rentals
. In effect, renters get a“lifestyle package”– a stark change from the isolated flat rentals of old.
Efficiency and Sustainability Benefits of Centralised Design
Solar panels on an apartment building rooftop, illustrating on-site renewable energy generation for residents. Many new multi-home developments incorporate such sustainable infrastructure to reduce costs and environmental impact.
Beyond convenience, multi-home schemes under one owner can achieve significant efficiencies through centralized design. When an entire building or estate is planned as a single entity, it becomes feasible to integrate technologies and services that would be impractical in one-off private rentals. Key efficiencies and sustainability features include:
On-site renewable energy production: Large developments can install solar panels, wind turbines, or combined heat-and-power systems to generate electricity and heat for residents. This reduces reliance on the grid and can lower utility costs for tenants. For example, UK build-to-rent projects are increasingly using solar PV and other renewables to help meet net-zero goals; on-site generation not only cuts emissions but also shields residents from volatile energy prices
. A notable global example comes from New York City: the Marcus Garvey Village apartment complex in Brooklyn deployed a first-of-its-kind microgrid with solar panels, batteries, and fuel cells to make the 625-home community largely self-sufficient, cutting energy bills and improving resilience during outages
.
Waste recapture and recycling systems: With many occupants in one place, owners can implement coordinated waste management strategies. This might include on-site composting facilities, biogas digesters, or greywater recycling systems that reuse bath and sink water for irrigation and flushing. High recycling rates can be achieved when infrastructure (like clearly marked recycling stations on each floor and community compost bins) is built into the development. The famous BedZED eco-village in London (100 homes managed by a housing association) demonstrated how design can drive waste reduction – over 60% of household waste at BedZED is recycled or composted thanks to the scheme’s sustainable setup and resident engagement
. Such approaches turn waste into a resource, whether by generating energy from it or by minimizing landfill.
Integrated utilities with single billing: Rather than each flat having separate contracts for electricity, gas, water, internet, etc., the owner can provide a one-stop utility package. Heating and hot water might come from a centralised energy centre for the whole building; internet and TV services can be supplied via a bulk contract. This means tenants receive one combined bill (often just included in the rent) covering all their utilities, simplifying life and often saving money. Co-living developments like The Collective in London advertise that “the little things like wifi and cleaning are all included in one bill” for residents
. By leveraging economies of scale, the building management can negotiate cheaper rates from service providers. For instance, owners can strike bulk internet agreements with broadband companies to get high-speed access for every flat at a fraction of the normal cost. In fact, rental housing operators in the US routinely negotiate better pricing and faster speeds for internet on behalf of tenants than individual households could achieve on their own
. The same logic can apply to bulk-buying electricity or securing discounted maintenance contracts, with savings passed on to renters (or used to fund better communal services).
Professional facility management: Since one entity runs the whole site, they can optimize maintenance and operations in a way a patchwork of individual owners could not. Everything from landscaping the gardens to servicing the lifts can be done on a schedule and budget that benefits from scale. This centralised approach avoids duplication – instead of 100 flats each calling out separate plumbers or repairmen, the operator has a dedicated team. Efficiency improves, costs per unit drop, and problems are resolved faster for residents. A well-run multi-home development can also invest in better technology, like smart thermostats or building-wide energy management systems, knowing the benefits (lower energy usage, preventive maintenance alerts, etc.) accrue across the whole property.
In summary, the single-owner model unlocks economies of scale and technical innovations that make rental homes more sustainable and potentially more affordable to operate. Tenants enjoy the fruits of these efficiencies: greener and cheaper energy, hassle-free one-stop bills, and a smoothly maintained living environment. As sustainability standards tighten (the UK aims for net-zero carbon by 2050), these centrally managed schemes are well placed to adopt green innovations quickly – an entire building can, say, switch to electric heat pumps or add battery storage in one coordinated move, rather than relying on disparate private landlords to act. This makes the future rented sector a crucial testing ground for eco-friendly housing at scale.
From Renter to Part-Owner: Innovative Equity Models
One critique of lifelong renting is that tenants do not build equity; their monthly payments enrich the landlord without creating any ownership stake for themselves. As one analysis pointed out, “mortgage payments allow you to accumulate housing wealth, whereas rental payments accumulate wealth for the landlord”
. In the traditional model, if you rent for decades, you leave with no asset, whereas a homeowner paying a mortgage ends up owning property. This dynamic has fueled a sense of frustration and insecurity among renters. To address this, some forward-thinking schemes are exploringinstallment-based financial modelsthat let renters gradually become part-owners of their homes.
Shared Ownership and JPUT Structures: A familiar approach in the UK is shared ownership, historically offered by housing associations and now appearing in the private build-to-rent sector. In a shared ownership scheme, a resident purchases a share (e.g. 25%) of their home and pays rent on the remaining portion, with the option to buy more shares over time. A new example is Lloyds Bank’s “Pathways” programme, which operates within its build-to-rent arm (Lloyds Living, formerly Citra Living). Under Pathways, tenants can rent a home indefinitely, but if they decide to buy later, they can do so via shared ownership – purchasing slices of equity as and when they can afford it
. In practice, a renter might start with 0% ownership, then in a few years buy a 10% stake in their flat, increasing their stake further over time until they potentially own the property outright. This “try before you buy” model helps lower the barrier to entry, since no big deposit is required up front
.
To facilitate multiple co-owners in one development, legal structures like Joint Property Unit Trusts (JPUTs) can be used. A JPUT is essentially a trust vehicle that holds the property assets on behalf of many investors, who each own units (shares) of the trust
. In the context of a rental scheme, the idea is that each tenant could gradually acquire units in the trust corresponding to their home. The trust would distribute rental income or capital gains to unit holders, meaning as a tenant’s stake grows, they receive financial returns, effectivelyturning some of their rent back into an investment. Over time, if a tenant-turned-investor accumulates a significant share, they gain more of the benefits of ownership (such as a share of any increase in the property’s value or a dividend from rental profits). This mechanism blurs the line between renting and owning, offering a continuum rather than a binary choice.
Tokenisation and Crypto Assets: Pushing the innovation further, some projects globally are experimenting with blockchain technology to tokenize real estate. Tokenisation means dividing ownership of a property into many small digital tokens that can be easily bought and sold. In the US, for example, the startup Lofty.ai allows renters to purchase fractional tokens of the very property they live in, starting from as little as $50
. By buying a few tokens, the tenant becomes a part-owner and even earns a portion of the rental income (essentially gettingcashbackon their own rent proportional to their stake)
. They can then keep buying more tokens over time, gradually increasing their ownership share, with the theoretical possibility of one day owning 100% of the property
. These tokens are tradeable, so the tenant could also sell their stake if they move out, allowing flexibility. Property-backed crypto assets like this represent a novel route to“rent-to-own”: instead of a traditional lease-option or mortgage, the blockchain tokens give renters a way to invest in their home in bite-sized increments.
While tokenised ownership is still in its infancy and comes with regulatory uncertainties, it demonstrates a future path where renters no longer have to choose between paying rent forever or taking on massive debt to buy a home. A hybrid model can emerge: you start as a renter and, through small investments or incremental share purchases, you become an owner over time. Importantly, these mechanisms can be built into the structure of large rental developments. For instance, a build-to-rent operator might set aside a portion of its units’ equity in a trust or token pool to be sold exclusively to tenants on favorable terms. Alternatively, tenants could be rewarded with equity shares for long-term occupancy (a loyalty bonus of sorts). If widely adopted, such practices could mean that the next generation of “renters” also accumulate wealth from their housing, addressing the wealth gap between owners and renters. In essence, the future could see renting as a first step on the property ladder, rather than a lifetime dead-end.
Banks as Landlords: A Changing Financial Landscape
One of the striking trends in recent years is the entry of big financial institutions – especially banks – into the rental property market. Traditionally, banks facilitated homeownership by lending money (mortgages) to buyers; now some banks are directly becoming landlords themselves. A prime example is Lloyds Banking Group, the UK’s largest mortgage lender, which launched its Citra Living division in 2021 specifically to buy and rent out homes
. The move is part of Lloyds’ strategy to diversify its income away from traditional lending and into stable rental yields
. In fact, Lloyds aims to acquire 50,000 homes by 2030, which would make it one of Britain’s largest residential landlords
. Other institutions have followed suit or are planning to – for instance, insurer Legal & General has been heavily investing in build-to-rent projects across UK cities, and in the US, investment firms like Blackstone have amassed large portfolios of single-family rentals.
The appeal to these companies is clear. Rental property as an asset class offers steady, long-term returns underpinned by the fundamental demand for housing. With more people unable or unwilling to buy homes, the rental market is seen as a growth area
. For banks like Lloyds, which historically made money through interest on loans, owning property provides a new revenue stream (monthly rent) and an appreciating asset on the balance sheet. As The Times reported, Citra Living was explicitly launched by Lloyds to shift its business model toward direct property ownership in response to market trends
. There is also a feedback loop at play: if banks find renting more profitable, they may lend less or more selectively for mortgages, potentially reinforcing the renting trend.
Implications for Housing: The rise of these “mega-landlords” has prompted both optimism and concern. On one hand, institutional landlords can professionalise the rental sector, raising standards. A bank or corporation has reputational incentives to treat tenants fairly, maintain properties well, and comply with regulations – they won’t be the stereotype of the amateur buy-to-let landlord who ignores repairs. Indeed, Lloyds markets its rental arm as providing “high-quality, accessible, affordable homes for the rental market” and highlights that most of its properties have high energy-efficiency ratings
. Large investors can also fund the construction of new homes at scale, contributing to supply. For example, through partnerships with developers, Citra Living helps finance the building of additional rental units that might not have been built otherwise
. This could be a boon in a country with chronic housing shortages.
On the other hand, centralised ownership of housing by financial giants raises questions. Every home an institution buys to rent is one less home available for local families to purchase. As a commentary on Citra Living noted, “every home built or purchased for the rental market is a home taken out of the housing market and unavailable for aspiring homeowners to buy”
. If banks end up owning swathes of housing, wealth accumulates in corporate hands (and ultimately to shareholders) rather than with individual homeowners. This could exacerbate inequality and frustrate those saving to buy. There’s also the spectre of“too big to fail”landlords – if a huge landlord went bust or decided to sell off thousands of homes at once, it could destabilise local markets or leave many tenants in limbo. Policymakers are watching these developments closely: the UK government has considered how to balance the benefits of institutional investment in housing with the need to protect tenants and would-be first-time buyers.
Distributed Local Ownership and Community Empowerment
An alternative vision for the future of rented housing emphasizes localised and distributed ownership rather than concentration in big banks or funds. This model involves local authorities, community organizations, or resident collectives taking the lead as the owners and developers of rental housing. The UK has some precedent for this: councils historically built and managed large stocks of social housing, and now many local councils are re-entering the housing development arena via independent local housing companies. In fact, over 160 council-owned housing companies have been established across England in recent years
. Their mandate is often twofold: to meet local housing needs and to generate revenue that can be reinvested in the community. Some of these council companies build homes for private rent (at market or near-market rates) to provide an income stream for the council’s budget
. Essentially, instead of rent payments flowing out to distant investors, they circulate back into local public services or further housing investment. For example, Barking and Dagenham’s companyBe Firstnot only develops new homes but also manages them, with profits helping fund council initiatives
. This echoes international models like the city of Vienna’s approach, where the municipality owns and manages a large portion of rental housing, maintaining affordability and quality for citizens.
Local landowners and community trusts can also play a role. In some cases, major local employers or landowners (such as an estate-owning family or a university) might contribute land or capital to develop housing, retaining ownership but with a commitment to local affordability. There are examples of rural estate trusts building rental homes for local residents, ensuring that villages remain livable and not just sold off as holiday properties. Community Land Trusts (CLTs) are another mechanism: these are nonprofit entities owned by the community which hold land and sometimes housing with the aim of permanent affordability and local control. While CLTs often focus on affordable home ownership, the same principle can apply to rentals – the community could be the landlord collectively, setting fair rents and policies that reflect local priorities.
The psychological and civic benefits of such localized ownership are significant. When people feel that their home is owned by an entity that they trust and identify with – be it the local council, a co-operative they are a member of, or even themselves as shareholders in a JPUT – they are more likely to feel invested in the well-being of the property and the neighbourhood. There is a stronger sense of accountability and connection. As one UK MP, Gareth Snell, observed, “community ownership is at its most fundamental level about bringing people together. People who own assets are connected, both to the community and to each other. They share responsibility for the most important aspects of community life”
. In housing terms, if tenants are also stakeholders (or know that their landlord is the local council they elected), they may take greater pride in their residence and collaborate more with neighbours. This can manifest in simple ways like residents organizing a gardening club to beautify shared spaces, or being proactive in reporting maintenance issues because they have a sense of shared responsibility. It can also lead to higher stability – people put down roots when they trust that their housing situation is secure and attuned to their community, rather than feeling like a small cog in a distant investor’s profit machine.
Studies of community-managed spaces show numerous positive outcomes. When residents have pride in their community, it leads to an increased sense of belonging and willingness to invest time and care into the area’s well-being
. Communities that are locally owned or co-produced tend to be cleaner, safer, and friendlier, because people see them as an extension of themselves. Economic benefits can follow too: a neighbourhood that residents are proud of is more likely to attract local businesses and investment, creating a virtuous cycle
. We can also consider civic engagement – tenants who are part-owners (even in a symbolic way) may be more likely to engage in local decision-making, attend resident meetings, or vote in local elections, since they have a tangible stake in local outcomes.
In practical terms, pushing for distributed ownership might involve policies like supporting co-operative housing developments, offering financing or guarantees for council-led housing projects, or enabling tenants of build-to-rent schemes to club together to buy out a development in the long run. It could also mean regulatory nudges: for instance, if a big bank is entering the rental market, perhaps require them to offer a percentage of equity to the local authority or to the tenants. Another idea floated in the fintech space is using property-backed tokens not just for individual tenant ownership, but for community crowdfunding of housing – imagine local residents collectively buy tokens to fund a new affordable housing block, and then hold governance votes on how it’s run. These scenarios illustrate that the future need not be an “all or nothing” between giant landlords and individual homeownership; hybrid and community models can combine the efficiency of scale with the human touch of local ownership.
Conclusion
The future of rented accommodation in the UK is poised to be markedly different from the past. We are likely to see a continued rise of large-scale, single-owner rental developments that provide high-quality homes with all-inclusive services and sustainable design. For renters, this can deliver a better, more convenient living experience – apartments that come with green energy, fast internet, shared facilities, and responsive management, all under one roof. At the same time, innovations in finance and ownership are blurring the lines between renting and owning, offering hope that renting need not equate to zero equity. Whether through shared ownership schemes like Lloyds’ Pathways, community trusts, or cutting-edge blockchain tokens, tomorrow’s tenants may gradually acquire stakes in the very buildings they live in, turning housing from a pure expense into a form of investment.
The evolving role of banks and institutions will no doubt shape this landscape. If done responsibly, their involvement can professionalise renting and accelerate home-building; if unchecked, it could concentrate too much power in too few hands. Counterbalancing this is the resurgence of local actors – councils, co-ops, community groups – asserting that homes should be more than just assets on a balance sheet, but rather the foundation of thriving local communities. The most promising vision for the UK’s rental future might synthesize these elements: imagine a new housing development where a city council partners with a private developer and a community trust. The complex is built efficiently with private capital and know-how, run by a professional management team, powered by solar panels and heat pumps, and every tenant automatically gets, say, a 5% equity token in the project with options to buy more. The council retains an ownership share to ensure local accountability, and the community trust oversees that rents remain fair. Such a model could deliver the best of both worlds – the efficiency and quality of scale, and the inclusion and empowerment of local ownership.
Ultimately, the future of renting in the UK will be defined not just by economic trends but by societal choices about what we want housing to be. If we embrace models that treat residents as stakeholders and not just customers, and harness the efficiencies of scale for the benefit of all, then the rented homes of tomorrow could provide stability, sustainability, and even prosperity for generations of Britons to come.
Sources: The insights and examples in this report are supported by a range of sources, including industry analyses, financial news, and case studies of innovative housing projects. Key references highlight the growth of the build-to-rent sector
, efficiency gains from centralised utilities and renewables
, new models of renter equity from bank-led schemes to blockchain tokens
, the strategic shift of banks like Lloyds into property ownership
, and the benefits of community ownership and pride
. These sources collectively suggest a dynamic and transformative path forward for UK housing.
Jan 16, 2025