Blog: Adapted and accessible properties - the next big opportunity in the PRS?
Liberty Bollen from accessible housing provider Abode Impact on the increasing demand for adapted homes.
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 Private Rented Sector.
Quite apart from helping wheelchair user tenants themselves, they are a smart investment strategy as (1) the UK has a growing ageing population and (2) good accessible design is inclusive without being intrusive, and so these assets will always appeal to a larger target market.
For buy-to-let landlords, understanding and participating in the massively underserved, accessible PRS could increase your yields. These properties benefit from longer tenancies, minimal voids and lower turnaround costs and fees, as well as loyal tenants who value what you offer. There is also possible help from the Disabled Facilities Grant for adaptations.
The NRLA has already responded to this potential demand by working with partners to produce an adaptation guidance to help landlords to better manage adaptation requests from tenants living with disabilities. Abode Impact contributed to this guidance, among other specialist organisations.
Tenant demand and affordability
1.8 million people have a need for accessible homes, but for many it’s like searching for a needle in a haystack. Half of the 448 wheelchair user household respondents surveyed by Abode Impact in the largest study of wheelchair user attitudes to housing were actively looking for a home to privately rent, and over 90% of all respondents had experienced barriers to accessing the PRS.
The shortage of this type of housing is primarily 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. Over 700,000 households in the UK which require accessibility features in their homes are in the top half of the national income distribution. The new coalition, Housing Made for Everyone, predicts a ‘dangerous shortage’ of suitable homes in the years to come, with only one new accessible home to be built for every 15 people over the age of 65 by 2030.
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 despite a huge range of search functions they are currently failing to cater for people looking to rent an accessible home. 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, but more needs to be done to make finding an accessible home as straightforward as possible.
For the market to supply the demand research shows exist, it will be essential to build a connection between tenant demand and suitable properties for rent. Abode Impact in conjunction with partners like AccessiblePRS is trying to do just that, by changing the narrative around accessibility, to highlight its relevance and value within the mainstream property market, and support corporate landlords and investor clients alike to be inclusive in their portfolios.
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.
Properly accessible properties have the potential to be the next big opportunity in PRS, particularly for larger landlords with significant portfolios. With regulatory and taxation changes making buy-to-let investments more challenging for some, landlords are looking for smarter ways to get the most out of their properties.
To date it has been extremely hard for disabled people to find the right property to rent. But when they do find the right home, they are more likely to stay in these properties long-term.. Even should their landlord wish to sell up, the tenant may decide to buy the property from them, saving unnecessary cost and hassle for both parties.
Tapping into this market will deliver both financial and social benefits and we hope that more landlords will consider opening up their portfolios.