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Build-to-rent sector reveals record period of growth

bpf btr build to rent

Build-to-rent (BTR) continues its seemingly unstoppable march across UK cities, with the British Property Federation reporting that 58,000 homes had detailed planning permission in Q4 2023, the highest number on record.

Its analysis, conducted in collaboration with Savills, suggests a strong pipeline of future growth, although building starts have dropped off since a post-pandemic peak of 25,000 units in Q3 2022, to 12,500 units in Q4 2023.

Despite this, the sector has reached a significant milestone, with the total number of BTR homes completed in the UK reaching 100,300 units, an uplift of 17% nationally, year on year.

The UK’s regions have seen a 23% year-on-year increase in the number of BTR homes under construction, almost double that of London (12%).

Regional pipeline

The BTR pipeline in the regions has also increased by 8% quarter-on-quarter and 22% on an annual basis, with 77,282 homes planned. Completions in London reached 46,700, and 53,600 in the regions.

However, the time required for BTR planning applications has significantly increased during the past decade, according to Guy Whittaker (pictured), head of UK build to rent research at Savills.

“Investment into build-to-rent proved resilient in 2023, in spite of challenges around the cost of debt and continued material and labour-cost inflation,” he explains.

“Investment continues to be directed towards development and the deals struck this year will ultimately deliver 12,000 much-needed homes for private renters.

“Investor appetite continues to grow, but the time taken to bring homes through the planning system, as our research demonstrates, remains a challenge.

"With schemes taking longer to work their way from application to permission, this reduces the number of ‘oven-ready’ sites, given investors are unlikely to take planning risk.”

Picture credits: Osel Architecture/Savills

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