Rented residential property market is booming in capital.
Cardiff is on the cusp of becoming the UK's next major buildto-rent (BTR) housing hub, following in the footsteps of London and Manchester.
However, this will only happen if residential developers deliver the mix of tenures and property needed, according to a new report from Knight Frank.
The property consultancy's annual Cardiff Report highlights office and residential development trends in the city.
The research shows that that while the proportion of households renting privately climbed from 22% in 2001 to more than 60% by 2017, none of it so far had been in the kind of purpose-built, professionally managed BTR stock that had proved so successful in London, Manchester and Birmingham.
Leah Mullin, head of Knight Frank's Cardiff residential development team, said: "The local population is already increasingly living in private rented accommodation, particularly in the city centre, where average private residential scheme household incomes are highest.
"In order to meet the ongoing demand, now is the time to more fully embrace BTR in the city centre, a trend which we are seeing throughout the UK."
Prime asking rents in the city centre, defined as the top 25% of the market by price, rose to PS1,050 per month during the third quarter of 2018, according to data from Rightmove, up from PS875 during the same quarter in 2015.
Ms Mullin said: "Cardiff is a rapidly expanding city, with a growing reputation as a great place to live and work.
"But if it is to retain the talent pool generated from Cardiff's three universities and attract new inward investors and occupiers, it needs to deliver more vibrant, amenity-rich, flexible living space.
"There are more than 50,000 higher-education students in Cardiff and our research indicates 40% of those that qualify in Cardiff plan to stay - that rates in the top five when compared with rival cities."
According to the report, younger workers are taking advantage of the increased flexibility of renting as a tenure, which allows moving between locations without any of the costs associated with buying or selling a property, The size of the UK market for BTR is estimated to climb from PS25bn in 2017 to PS70bn by 2022.
Ms Mullin added: "There are early signs the residential market is beginning to respond to the opportunities offered from this dynamic city, which is driving both land and house values.
"A high-quality pipeline is beginning to emerge at a critical time, which will be vital in supporting continued growth in the local economy and population.
"Developers have earmarked Cardiff as a new area for growth. So far, detailed plans have been granted for one BTR project totalling 206 units on the former Browning Jones and Morris site (at Dumballs Road); planning has been granted for 305 units at The Interchange at Central Square; and IM Properties, in a joint venture with Spitfire Urbane, have submitted an application for 307 apartments at Capital Quarter.
"Plans are being drawn up for a further six schemes likely to be partial or entirely BTR, which if approved could deliver more than 3,000 new homes over the coming decade.
"Those projects need to be delivered to meet the demand from the ever-expanding commercial market."
Knight Frank's Cardiff Report claimed that the outlook for Cardiff's economy, connectivity and demographics supported the case for a growth in the BTR sector.
The growth of Cardiff's population and economy was projected to outpace all other major UK cities over the next decade, according to Experian.
Moreover, growth in gross value added, a key measure of economic growth, is projected to outpace all other major cities with the exception of London.
Ms Mullin said: "The city certainly has the demographics and economic prospects to support the concept. We're already seeing strong interest from domestic and foreign funds to acquire stable assets."
<B Computer-generated image of the 23-storey for-rent private residential scheme in Cardiff from Spitfire Urbane