Property experts have called on the government to kick-start build-to-rent (BTR) through targeted tax and regulatory measures in a bid to address prohibitively high financing costs.

New research from Real Estate:UK by Savills reveals that annual starts-on-site across the UK fell by more than 63% during the Prime Minister’s first 100 days in office (Q3 2026) compared to Q3 2025 (4,696 new starts, down from 12,674).

Q3 was the eleventh consecutive quarter where completions (21,979) exceeded starts-on-site as the pipeline of new homes for rent diminishes due to rising construction and financing costs, planning and regulatory delays and the cumulative impact of taxes and levies on development viability, according to the group.

While the numbers of consented units have increased slightly year-on-year, the number of schemes at detailed application stage has dropped by 9% since last quarter (Q3 2026 vs Q2 2026), which it warns will impact longer-term supply.

Interventions

The industry group argues that cost-effective interventions, including restoring SDLT multiple dwellings relief for high-density housing and zero-rating VAT on rents, would address viability, unlock investment and drive economic growth.

The decline in the number of homes under construction combined with a higher than usual number of completions (21% higher in the 12 months to Q3 2026 than 2025; 21,979 vs 18,204), has seen the number of homes under construction fall by 30% nationally, with both London (down 28%) and the regions (down 30%) experiencing similar drops.

It believes this drop reflects viability pressures facing the sector, which have been compounded by political uncertainty on issues such as potential rent controls and a lack of political will to urgently address key sector challenges, including ongoing delays with the Building Safety Regulator and unnecessary costs arising from the PRS database design.

Worrying

“The Q3 2026 delivery figures show the persistent and worrying decline in the number of new starts on site across the UK, and lay bare the extent to which the viability crisis is pushing development of homes for rent to breaking point,” says Real Estate:UK director Danny Pinder.

“Annual completions are up, which is positive, but if we can’t bring new supply into the pipeline quickly enough, we risk exacerbating the UK’s housing shortfall, with a significant impact likely to be felt down the line,” he says. “We need all parts of the market to be firing on all cylinders to address the housing crisis, and this budget fell short of what is needed to address the viability crisis.”

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