How institutional practices can help deliver quality affordable housing

Investment in build-to-rent (BTR) has shown that a keen focus on thoughtful specification and a resident-focused service delivery can benefit all stakeholders.

 

By adopting a tenure-blind approach in which this is applied, institutional investors can help set a new benchmark in affordable housing.

 

Aligning capital, development and management

 

Long-term patient capital requires future-proofed homes to meet sustainability targets and social impact commitments.

 

It is essential to consider how we align housebuilding and management with long-term capital requirements.

 

Future-proofing homes helps achieve stable cashflows. Retrofit is expensive and logistically complicated, often involving decants to preserve lifelong tenancies, so new homes must be built to serve the needs of tomorrow.

 

Specifications need to incorporate high-performance insulation, air source heat pumps for low-carbon heating and solar panels.

 

Technology also plays a role in managing risk and reducing operating costs. Installing damp and mould sensors, leak detection devices, low-energy lighting and energy-efficient white goods helps prevent health risks and enables proactive maintenance.

 

Together, these reduce life-cycle costs, improve resident satisfaction and position affordable housing as a sector that embraces innovation and sustainability.

 

In our view, homes should be ready for immediate occupancy, fully functional, aesthetically pleasing and aligned with brand standards.

 

Simple additions such as integrated blinds, flooring and white goods create a sense of quality from day one and, crucially, reduce move-in costs for residents.

 

Providing someone with an affordable home but requiring them to spend thousands on essential fixtures and fittings is counterproductive.

 

Building community through structured engagement and a tenure-blind approach

 

Creating a home also means creating a community. Building homes is only part of the story; residents need spaces and opportunities to connect.

 

Institutions need partnerships with registered providers to share learnings, push each other to continuously improve and deliver a resident-focused service.

 

The affordable housing sector is embracing a culture of structured engagement.

Arguably, Tenant Satisfaction Measures (TSMs) are akin to more established practices in the BTR sector, where the value of the resident experience is prioritised and tracked through regular surveys, feedback loops and proactive communication.

 

Surveys and digital platforms enable real-time connections but, while technology will play an increasingly important role, there is no substitute for human interaction.

 

Fast response times, clear communication and visible people on the ground remain fundamental. Residents must feel safe and supported, and combining traditional approaches with tech-driven solutions helps ensure this.

 

Simple initiatives – seasonal events, children’s activities, resident gatherings – can strengthen social bonds at minimal cost.

 

Affordable housing residents deserve the same opportunities for connection as BTR tenants, through a tenure-blind management approach that provides all residents with the same standard of service.

 

Institutional investors with broader residential platforms can also help facilitate the creation of mixed-tenure communities. Greater engagement with residents can help foster loyalty and build communities where people feel valued.

 

Assisting the delivery of quality homes through forward funding

 

The forward funding approach is an effective route for institutions to help build affordable housing that can be efficiently managed.

 

By committing capital early, investors and their registered provider partners can influence design and specification from the outset with the resident experience in mind.

 

The model provides useful financial clarity and stability for development to happen and ties capital to the creation of quality purpose-built homes.  

 

Working with developers and house builders who share institutional standards helps maintain transparency, consistency and accountability throughout the delivery period and beyond.

 

This builds confidence among all stakeholders and helps raise the bar for the provision of quality affordable housing in the sector.

 

Affordable housing can match – and in our experience, exceed – private rented sector standards by embracing institutional best practices.

 

From specification-led design to resident engagement and disciplined funding models, these approaches offer a pathway to homes that meet social and financial objectives.

 

Collaboration between investors, developers and housing associations is essential to achieving this vision.

 

If we align our approaches and share our expertise, we can deliver more than just buildings – we can create homes that endure and communities where people feel valued. That is how we turn houses into homes.

 

Ann Xu, portfolio manager, UK affordable housing fund, CBRE Investment Management