Across the UK, starts on site for Build-to-Rent homes have dropped by 79% in the year to June 2026, according to data from Savills for Real Estate:UK (RE:UK)
Across the regions outside of London, the drop increases to 84%, a measly 2,176, down from the previous figure of 13,893.
RE:UK attributes this drop to viability pressures facing the sector, and the tendency for investors to put their money into existing assets as opposed to new developments.
The landscape is not reassuring
Issues with viability are being compounded by the broader political landscape and policy uncertainty, including rent controls, says the report, and further finds that every single respondent said they would reduce investment in BTR and avoid mayoral areas if rent controls were put in place.
This pressure has also affected schemes currently under construction, as across the country the number of homes fell by 21% in Q2 2026 from Q2 2025, and London saw a larger drop of 27%. This is the 10th consecutive quarter in which completions has exceeded starts.
This is a symptom of completions starting to outnumber starts-on-site and schemes getting through the planning system, despite a high number of schemes being granted approval.
As a result, RE:UK is urging the government to avoid putting any new policies or announcements in place temporarily, as to not add more uncertainty to the sector and drive viability pressures up further.
The BTR sector still performs strongly despite these setbacks, as it is still considered by many to be an emerging market.
“It is now unviable to bring forward new schemes despite strong underlaying tenant demand”
Danny Pinder, director at Real Estate:UK, said: “The Q2 2026 delivery figures have shown one of the sharpest declines in the number of new start-on-sites yet, and undoubtedly reflect the impact the viability crisis is having on the development of BTR schemes across the UK. That the sharpest decline in starts is within the regions is yet further evidence of the fact that, in most parts of the country, it is now unviable to bring forward new schemes despite strong underlaying tenant demand. In addition to viability, we also have increased regulatory uncertainty, through speculation around rent controls continuing to impact on investment considerations.”
Jacqui Daly, director of Savills Residential Research, said: “Build-to-Rent has become an increasingly important source of housing supply, with the potential to unlock new development by enabling housebuilders to open sites with investors underwriting delivery. As demand for rental homes continues to grow, it is important that the sector can continue bringing forward new schemes across the UK.”
In September last year, Tim Barrett, the chair of Construction Alliance North East, discussed the Build-to-Rent market as having moved from a niche concept to a popular choice for developers and investors.
Tim writes: “In the last five years, the UK’s investment in the build-to-rent sector has jumped from nothing to over £4bn every year. Industry statistics indicate that there are currently more than 250,000 homes either being planned or under construction, with cities such as London, Manchester, Birmingham, Leeds, and Glasgow at the forefront. The number of these projects now matches that of traditional homes being built for sale in major cities, and significant pension funds are investing billions into new developments.”
Read Tim’s full thoughts here.
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