The housing market in the United States is everchanging. As interest rates rise and mortgage payments jump, people—especially families with multiple children—seek more affordable options.
The answer to their needs might just be the growing trend of built-to-rent (BTR) communities. These unique housing establishments offer a sense of community while providing various amenities and services, including recreational facilities and property management.
However, as with any communal housing environment, challenges such as security and maintenance are common.
In this article, we’ll explore the key attributes of built-to-rent communities, how they differ from regular residential properties, some key safety concerns that they present, and how security and Proptech (Property Technology) software companies have been stepping up to provide innovative solutions to these problems.
- What does build-to-rent mean?
- How is build-to-rent different from other residential properties?
- Why build-to-rent is an attractive investment opportunity
- Build-to-rent security concerns
- How integrated security software can benefit built-to-rent communities
- Common security options for build-to-rent communities
- Final thoughts
What does build-to-rent mean?
Build-to-rent, also known as BTR, refers to a type of residential development where units are specifically designed and built for the purpose of being rented rather than sold to owner-occupiers.
These communities are typically owned by companies or institutions that manage the property, provide amenities and services for residents, and take care of maintaining and securing the buildings and grounds.
BTR communities can offer a variety of property types, from single-family homes, townhouses, and apartments to multi-family housing. They often include attractive amenities like clubhouse facilities, swimming pools, gym facilities, and play areas to enhance the lifestyle and appeal to potential tenants.
How is build-to-rent different from other residential properties?
While traditional residential properties are built to be sold to individual homeowners, BTR communities are constructed with the aim of being leased out by a single owner or management company.
This fundamental difference affects multiple aspects:
Ownership and management
Unlike traditional residential properties, where homes may be managed independently by each homeowner, in BTR communities, all properties are typically managed by the same company. This ensures uniformity in terms of maintenance, services, and community rules.
Amenities and services
Built-to-rent communities often offer a wide range of amenities to increase appeal to tenants. These include fitness centers, community pools, clubhouses, play areas, and even lawn services, maintenance, and security services.
Design and layout
BTR communities have the tenant’s lifestyle and the communal living experience in mind. The houses or apartments within the community usually follow a similar design for consistency. Shared spaces are also integral to BTR communities for fostering a sense of togetherness among residents.
Unlike traditional leases, BTR communities often offer more flexible lease terms. They may provide short-term leases, allow pets, or even include utilities in the rent.
Management companies in BTR communities handle all property maintenance, inside and outside the home. So, tenants can enjoy living in a well-maintained home without worrying about doing repairs themselves.
Though rental costs may be higher in a build-to-rent community compared to a traditional single-family home rental, tenants get more for their money. The cost includes not just the property itself, but also the additional amenities and services provided by the community.
Why build-to-rent is an attractive investment opportunity
The build-to-rent sector has emerged as an appealing avenue for real estate investment. As more people opt to rent long-term instead of buying a house due to its affordability, an opportunity arises for investors to tap into the growing demand.
BTR properties, with their built-in amenities, full-time property management, and sense of community, are particularly attractive to a demographic seeking the benefits of single-family living without the financial and time commitments of homeownership.
Investing in BTR communities is a strategic real estate investment that diversifies an investor’s portfolio. With a growing number of renters seeking high-quality rental homes with community benefits, it represents an always-in-demand property category.
Not to mention, these communities tend to attract long-term tenants, allowing lower turnover rates and reducing the costs and downtime associated with frequent tenant changes.
Key factors that make BTR an attractive investment opportunity include:
Stable cash flows
BTR communities can create consistent and predictable income for investors. Unlike traditional home sales that provide a one-time payment, rental properties offer steady monthly revenue.
BTR communities are professionally managed, eliminating a great deal of operational stress and liability for the property owner.
Over time, well-maintained properties can appreciate in value, providing strong capital growth and return on investment.
Lower vacancy rates
As mentioned, BTR properties typically attract longer-term tenants, reducing the risk of vacancies and providing a more reliable revenue stream.
But as with any investment, it’s essential to understand the market and conduct thorough due diligence to maximize returns and minimize risks.
Build-to-rent security concerns
As with any shared housing environment, built-to-rent communities face some security concerns that residents and developers need to consider.
- Physical security: As these communities may have a large number of occupants, ensuring physical security can be tricky. This includes securing buildings, common amenities, parking areas, and playgrounds.
- Access control: Some built to rent communties are competely gated around the perimeter. Managing who has access to the community and its amenities is a significant challenge. Unwanted guests or intruders can pose safety concerns.
- Visitor Management: BTR communities often feature controlled access, with physical barriers like iron gates or access control arms in place to deter unauthorized access to the property. In such situations, careful consideration must be given to visitor management. The approach to managing visitors may vary, depending on whether the community has a staffed guardhouse, with security personnel stationed there throughout the day to handle visitor confirmation, validation, and processing. Alternatively, visitors may need to utilize a kiosk or intercom system for scanning digital passes or contacting homeowners to gain entry. For BTR developers, specialized software solutions are available, designed to streamline and enhance the visitor management process, making it seamless, efficient, and a more enjoyable experience for both tenants and guests.
- Property crime: As with any residential area, BTR communities are not immune to instances like theft, vandalism, or burglary.
- Surveillance: CCTV cameras can be crucial for monitoring the premises, but surveillance in areas with expected privacy can lead to resident discomfort.
- Emergency response: A robust system for managing emergencies like fires, medical crises, or security breaches is important to ensure resident safety.
- Data security: As many BTR communities use digital solutions for property management and access control, the security of these systems and the resident’s data is critical.
- Tenant screening: Implementing and maintaining an effective screening process for potential tenants is an upfront security measure that can mitigate disturbances.
Many BTR communities are increasingly turning to innovative security software solutions to address these and other potential issues.
How integrated security software can benefit built-to-rent communities
From a developer’s perspective, incorporating robust security measures into a BTR community design is a strategic investment that can significantly enhance the value, appeal, and, ultimately, profitability of the project.
Securing the development contract
A well-rounded and comprehensive security plan, facilitated by integrated software solutions, can give an edge during the development contract bidding process.
Demonstrating readiness to handle safety concerns through high-tech, modern methods shows a commitment to creating a highly secure living environment for residents.
Security is a top-tier consideration for potential renters. An advanced security system with features like automated gate access control, visitor access and management, and even license plate recognition and anti-tailgating measures adds an extra layer of appeal for your community.
It reassures prospective residents about their safety and can persuade them to choose your property over others.
Increasing property value
Properties with higher levels of security generally command higher rents. You substantially increase its value by integrating substantive security measures such as smart keycards, fobs, or mobile entry systems into your BTR community. This, in turn, allows you to set higher rental prices, thereby enhancing overall revenue.
Visitor and vendor management
Security software can streamline visitor and vendor management, ensuring only authorized individuals can access the premises. This not only enhances security but also can be pitched as a convenience feature to potential residents, as they can seamlessly manage guest access from a mobile app.
Integrated security systems can incorporate anti-tailgating features, preventing unauthorized individuals from accessing the community by following a resident through a gate or door. This shows potential residents, investors, and insurers that the community is actively protecting against common security threats.
While there’s an initial investment involved in setting these systems, in the long run, they can decrease costs associated with human errors, traditional access methods (like the replacement of lost keys or access cards), or potential thefts and break-ins.
Investing in a flexible, scalable security software system ensures you’re prepared for future growth or technological advancements. This could be a selling point for both potential investors and prospective tenants.
Common security options for build-to-rent communities
Here are some of the common security options that can enhance the sense of safety and security in a BTR community.
- Intercom systems: Intercom systems provide a secure way of managing access control in a rental community. The system allows residents to verify and communicate with visitors before granting access.
- Visitor Management: Building upon our previous suggestion, it’s worth noting that certain Build-to-Rent (BTR) communities incorporate guardhouses at their entrances. This feature is particularly prevalent in upscale communities and serves to enhance security, as well as the perceived security levels, thereby positively influencing property values and elevating the overall prestige of these communities. Inspired by this successful practice, many developers are now adopting the same strategy for luxury BTR communities. The implementation of Visitor Management software plays a pivotal role in facilitating this transition, streamlining the process for seamless visitor management.
- License plate readers: License plate readers can recognize and record the license plates of all vehicles entering and exiting the community, providing a strong deterrent to crime and a valuable tool for investigation in case of incidents. They can even provide access to authorized vehicles by registering the plate.
- Smartphone access: Smartphone access systems offer secure and convenient ways for residents to access their homes and community amenities. Using an app, residents can control access to their residence, request maintenance, book amenities, and much more.
- Community HOA web portal: A website makes community engagement and communication easy and efficient. This secure platform offers features such as online payments, booking of amenities, and a hub for community announcements.
By leveraging these security options and integrating them into a holistic security plan, built-to-rent communities can provide their tenants with a safe and enjoyable living environment.
The rise of the build-to-rent sector signifies a shift in consumer preference towards affordability, convenience, flexibility, and community living. As this housing trend continues gaining momentum and popularity, ensuring a robust security environment is paramount for tenants’ safety and the community’s success.
For more information about securing residences and larger communities, check out Proptia’s robust resource library, with detailed information about everything from virtual guards to door strike plates.
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Nick is a tech-savvy freelancer with a passion for coding and a knack for writing. As a programmer by trade, he knows the ins and outs of the digital world, with a particular interest in PropTech and Security Tech. When he’s not tinkering with the latest software, you can catch him scaling mountains or unleashing his creative side on a canvas.