The number of new build-to-rent (BTR) homes beginning construction across the UK has dropped sharply, with starts on site falling by 79% in the year to June 2026, according to the latest delivery figures compiled by Savills for Real Estate:UK (RE:UK).
The decline has been particularly significant outside London, where new starts fell by 84%, dropping from 13,893 homes to just 2,176. Meanwhile, the number of BTR homes currently under construction also declined, falling by 21% nationally compared with the same period last year.
London saw the biggest reduction in active construction, with homes under development down by 27% year on year, compared with a 19% fall across the regions.
Build-to-Rent Pipeline Continues to Shrink
The latest figures highlight ongoing concerns around the future supply of new rental properties, with completed BTR homes continuing to outpace the number of new projects starting construction.
Annual completions have now exceeded new starts for ten consecutive quarters, suggesting that the sector is increasingly relying on existing developments rather than a strong pipeline of future schemes.
Despite more projects receiving planning approval, many approved developments are struggling to move forward due to rising costs, weaker viability and uncertainty around future government policies.
Investment Shifts Towards Existing Assets
The slowdown in new developments reflects wider challenges facing the build-to-rent sector. Increasing construction costs, higher borrowing expenses and regulatory uncertainty have made it more difficult for developers and investors to deliver new schemes profitably.
As a result, investment activity has increasingly shifted towards established BTR properties rather than funding new developments.
Recent concerns over potential rent controls and changes to property taxation have added further uncertainty, causing some investors to reassess their plans for future projects.
A survey of investors carried out for RE:UK before Deputy Prime Minister Angela Rayner confirmed that rent controls would not be introduced found that:
- All respondents said they would have reduced their BTR investment if rent controls had been implemented.
- Every investor surveyed said they would have avoided areas affected by potential mayoral policies under such a scenario.
RE:UK warned that further uncertainty or sudden policy changes could create additional pressure on the sector and discourage investment in much-needed rental housing.
Build-to-Rent Still Plays Key Role in Housing Supply
Despite the fall in new starts, build-to-rent remains an important part of the UK’s housing market. The sector currently accounts for around 8% of new homes being delivered, highlighting its contribution to increasing rental supply.
However, the sharp decline in new developments raises concerns about whether enough homes will be delivered in the coming years to meet growing demand from renters.
Danny Pinder, director at Real Estate:UK, said the latest figures reflected the impact of the viability challenges affecting BTR developments across the country.
He said the larger decline outside London showed that delivering new schemes had become increasingly difficult in many areas, despite continued demand from tenants.
Pinder added that uncertainty around potential rent controls and changes to property taxation had also influenced investor decisions and created additional challenges for developers.
Sector Remains Important for Future Rental Supply
Jacqui Daly, director of residential research at Savills, highlighted the continued importance of build-to-rent in supporting housing delivery.
She said the sector has become an increasingly valuable source of new homes, allowing developers to unlock sites by working with investors who can support long-term delivery.
With demand for rental properties continuing to rise, industry experts believe maintaining confidence and encouraging new investment will be essential to ensuring more BTR schemes can progress across the UK.
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