Build to Rent Premiums – Student Vs Studios
For all the talk about Build to Rent premiums, have you considered the discount to Student Accommodation? We look at Scape Melbourne and The Liv Mirvac, Munro project to find out.
Assessing the Scape Melbourne Portfolio (currently listed) as a base case, the units can be broken into “Small Studios” & “”Larger Studios”. These are on average 17 & 26 sqm in size, respectively. How do these compare to BTR premiums once analysed by per sqm? We look at Liv Mirvac to find out.
These units are renting on average for $515 & $681 per week, all inclusive. In comparison, the average Studio listing price at the Mirvac, Liv Munro project currently at $585 pw.
Once additional inclusions are adjusted for, Scape weekly rents are inline, or slightly below that of Liv Munro. However, the Studios are 35% – 65% smaller – Liv Munro average Studio 39 sqm.
Without taking into account the added services of student accomodation, where would you rather rent if you were new to Australia?
Is Build to Rent a solution to the tight inner city Student Accomodation rental market?
Adjusted rents at Scape average between $22 & $25 psm compared with $15 psm at Mirvac. This is a 35% Discount to Build to Rent providing food for thought to students and renters alike.
Student accommodation is now back to pre-pandemic demand with low vacancy and high demand.
Would students pay a similar $/m2 to rent a larger BTR unit than an apartment in a student accommodation building? Are they really Build to rent premiums or is it a BTR discount? As the market matures, we are gaining a better understanding of the demands of renters.
Read further about the rental affordability crisis, the ageing demographic of first home buyers, Slow Rental Growth for 2 Br Units and how rental growth is outpacing record wage price growth in 2023.