The main investor behind a boom in high-rise apartments in the centre of Cardiff has claimed the developments could bring the city's rising rents down. Finance company Legal & General is building 1,000 flats to rent in the Welsh capital. But with some of its one-bedroom apartments costing £1,300 per month, a letting agency has warned renters could be priced out of the market. Private rents in Wales have risen by 8.5% over the past year, while in Cardiff they have increased by more than 9%, according torecent data from the ONS. Cardiff is following in the footsteps of cities like Manchester and Liverpool and seeing a major growth in so-called build-to-rent accommodation, which are apartment blocks owned by investment companies that are only available to rent. They typically have on-site gyms, communal living spaces and concierge reception areas. Around 1,000 flats of this kind have been built in Cardiff in recent years and nearly 3,000 more are on the way, according to property consultancy Bidwells. They said the average monthly rent of a one-bed in Cardiff's new build-to-rent market was £1,297 per month, compared to £944 in the traditional market. Legal & General claim that by increasing the supply of properties on the rental market, prices will become more affordable. "With huge amounts of supply all coming in at one time, we are controlling and limiting rents going up in the city," said Dan Batterton, the company's head of residential. But Jon Hooper-Nash, lettings director at Jeffrey Ross estate agents, is sceptical. "It is classic GCSE economics: supply and demand, but the rents they are asking for are already much more expensive than what they are up against," said Mr Hooper-Nash. "So I don't quite understand the narrative that they are going to bring rents down, when they have put them up." Legal & General, which has 30 residential developments across the UK, already owns one block in Cardiff with around 300 apartments called Wood Street House, which it said was full. It said another development with more than 700 apartments on the site of the former Brains brewery would come on stream next year. "People have slowly moved out of city centres because they have not been particularly nice places to live but we need to use the land we have got better, otherwise we have to start expanding our cities," said Mr Batterton. "We are taking brownfield land in the middle of our city centres, building homes on them and that is bringing people back. "People are using the high street, the restaurants and bars because that is where they live." Asked whether the rents were too high for the local market, Mr Batterton said rents in the new site would be lower. "We cannot just be high-end if we have 1,000 apartments in the city centre of Cardiff, we have to be attractive to as wide a range of demographics and wages as we possibly can." But Mr Hooper-Nash said the rents of the new apartments would have to come down substantially to be affordable. "We deal with hundreds of tenants every week. In 12 months it may be different, but the people we see, the private rental tenants in Cardiff, what they can typically afford is not that," he said. "Unless a change is happening I don't see how they're going to work." So what do renters make of the new developments? Eden Cronin, 27, from Cardiff, welcomed any increase in the supply of rental accommodation. "It took us ages to find a place," she said. "We found when we were looking or going to places, it had already been taken or there had been three viewings before us. It was almost like a race." What did she think of £1,300 for a one-bed apartment? "It's expensive, especially as it's not London. "I would expect something quite big, spacious with a garden, a driveway or somewhere to have a car." Alejandra Escamilla, 26, from Cardiff, said she was currently paying £900 a month to rent a one-bed apartment and that was "within [her] comfort zone". "It's a one-bed apartment with a shared garden and the building is quite new. No bills are included," she said. "I am expecting rents to go up actually but I am planning on moving out of the city. That will be cheaper." Fergus Thomas, 31, from Abergavenny, cast doubt on the investor's claim that rents could be brought under control. "I think it's probably unrealistic," he said. "I have rented for quite a few years and every time I feel it gets harder to find something, and every time it feels more expensive. "There is too much money to be made and too many people looking to rent a place so I don't think they'll come down." Ben Gaffiero, 28, and his partner Pratibha Zala, 27, live in a build-to-rent apartment block called Copper Works which has an on-site gym, concierge reception and roof terrace. They pay £1,100 a month for a one-bed apartment with bills on top and said it felt like living in a hotel. "I lived in a different place that was about £800 a month and that was disgusting, so comparing that to there I would say it is worth it. At least it's hygienic and a place that is good to live for a human being," said Ben. "It gives us a different standard of living," added Pratibha.
High-rise boom could bring rents down, claims investor
TruthLens AI Suggested Headline:
"Investor Claims High-Rise Developments in Cardiff May Help Lower Rental Prices"
Bbc News
7.4
TruthLens AI Summary
In Cardiff, a significant expansion in high-rise apartment developments is underway, spearheaded by finance company Legal & General, which is constructing approximately 1,000 flats intended for rental. This initiative is part of a broader trend in cities like Manchester and Liverpool, where build-to-rent accommodations are becoming increasingly popular. The average rent for a one-bedroom apartment in these new developments stands at £1,297 per month, substantially higher than the £944 average in the traditional rental market. While Legal & General asserts that increasing the number of available rental properties will help temper rising rents, some industry experts express skepticism regarding this claim. Notably, private rents in Wales have surged by 8.5% over the past year, with Cardiff experiencing a more than 9% increase, raising concerns that the new developments may not be affordable for many local renters.
Despite the optimistic projections from Legal & General, which has a history of residential developments across the UK, local renters have mixed feelings about the rising costs. Many potential tenants, such as Eden Cronin, acknowledge the need for more rental options but are wary of the high price points, particularly for one-bedroom apartments. Others, like Alejandra Escamilla, are already experiencing the financial strain of current market rates and are contemplating moving out of the city to find more affordable housing. Critics like Jon Hooper-Nash argue that the proposed rent levels are not aligned with what most renters can afford, suggesting that substantial adjustments will be necessary for the new apartments to be viable for the local demographic. As Cardiff continues to evolve its housing landscape, the balance between supply and demand remains a critical issue, with many questioning whether the influx of high-end apartments will genuinely lead to more affordable options for everyday renters.
TruthLens AI Analysis
The article outlines the current situation in Cardiff's rental market, focusing on the burgeoning high-rise apartment developments spearheaded by the finance company Legal & General. It highlights the significant increase in rental prices in the region, while also presenting a contrasting claim from the investor that the new developments could lead to lower rents.
Investor Claims vs. Market Reality
Legal & General asserts that the influx of new rental properties will help stabilize rents and make them more affordable. The company's head of residential, Dan Batterton, emphasizes that increased supply will control rising prices. However, this perspective is met with skepticism from local letting agencies, such as Jeffrey Ross estate agents, where the lettings director, Jon Hooper-Nash, indicates that the new rents are already higher than the traditional market, casting doubt on the investor's claims.
Rising Rental Prices
Data from the Office for National Statistics (ONS) shows that private rents in Wales have surged by 8.5% over the past year, with Cardiff experiencing an even steeper increase of over 9%. This context suggests that the rental landscape is becoming increasingly challenging for tenants, contradicting the narrative that new developments will mitigate rent hikes.
Potential Manipulation of Information
The framing of the article may suggest an attempt to downplay the negative impact of rising rents on the community. The optimistic projections from Legal & General could be seen as a strategy to attract investors and justify the high rental prices. The contrasting opinions from local agents highlight a potential disconnect between corporate interests and the realities faced by renters, raising questions about the transparency and motivations behind these developments.
Public Perception and Community Impact
The article aims to paint a picture of growth and opportunity in Cardiff, appealing to investors and stakeholders in the real estate market. However, it may also evoke concern among current and prospective renters who feel priced out of the market. The narrative could foster a sense of distrust toward large investment companies, especially if the anticipated benefits do not materialize.
Economic and Social Implications
If the high rental prices continue to rise without corresponding increases in wages, the local economy could suffer as residents may be forced to move to more affordable areas. This could lead to social fragmentation and a lack of diversity in urban centers like Cardiff. The housing sector's dynamics will likely remain a contentious issue, affecting political discussions and policy decisions at multiple levels.
Investor Interests
The article seems to cater more to investors and stakeholders in the property market rather than the average renter. By presenting a hopeful narrative regarding the impact of new developments, it seeks to garner support from those looking to capitalize on the growing rental market while potentially alienating the very tenants who are affected by these changes.
Market Implications
The developments and the discussions surrounding them could influence stock prices of companies involved in real estate and construction. Investors may keep a close eye on Legal & General and similar firms as the success of these projects could have broader implications for the housing market and investor confidence.
Connection to Broader Trends
This article fits into a larger narrative about urbanization and the challenges that come with it, particularly in the UK. As cities continue to grow, the balance between development, affordability, and community needs becomes increasingly critical.
In conclusion, while the article presents a case for optimism in Cardiff's rental market, it also reveals underlying tensions and skepticism about the true impact of new high-rise developments. The reliability of the information hinges on the perspectives presented and the context of rising rents, suggesting a need for cautious interpretation of the investor's claims.