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UK: A group of organisations have called on the Mayor of London and ministers to intervene in order to save the delivery of build-to-rent (BTR) properties across the capital.
New analysis from the fifth edition of the Who Lives in Build-to Rent? report for London from BusinessLDN, Real Estate: UK, the Association for Rental Living and PriceHubble, shows that the number of BTR homes under construction has fallen by almost a third in the last year alone, from 17,138 in Q1 of 2025 to 12,134 in Q1 this year. The report is based on analysis of more than 12,000 BtR homes and 21,000 residents.
It highlights how the rising cost of development, combined with continued delays within the three stages of the Building Safety Regulator (BSR)’s Gateway regime, has contributed to the number of BTR homes under construction in the capital falling by almost a third over the past year. It comes against the backdrop of a wider slump in new housing starts in London, which fell to 5,550 last year against an annual target of 88,000.
BusinessLDN is calling on City Hall to use its upcoming review of the London Plan – the Mayor’s spatial strategy – to provide firmer direction to London’s boroughs to plan for more BtR developments in their areas. The Plan should also address a discrepancy in its new emergency housebuilding measures which sees BtR developments excluded from grant funding because of the nature of the affordable housing they offer.
And in order to kickstart the wider market, BusinessLDN is calling on the Government to pause and review implementation of the Building Safety Levy, due to be introduced from October, and for the BSR to step up its progress in processing applications more quickly and efficiently. Latest industry figures show that the housing sector has already made around £6bn worth of additional building safety commitments.
Stephanie Pollitt, programme director for housing at BusinessLDN, said:“Build-to-rent homes have a crucial role to play in tackling London’s housing crisis, so a slump in supply should serve as a wake-up call for all levels of government. The current review of the London Plan is a crucial opportunity to level the playing field between for-sale housing developments and build-to-rent projects excluded from City Hall’s new emergency fast-track route. We also need to see wider action to kickstart the entire market to accelerate housebuilding across all tenures.”
The new report finds that close to four in ten (38.8 per cent) of the developments it analyses provide homes at Discount Market Rent and/or London Living Rent. Despite this, BtR developments are not eligible for grant funding through City Hall’s new fast-track planning route.
As such, BusinessLDN is recommending that the London Plan’s affordable housing requirements for BtR developments are brought in line with the thresholds for those benefiting from the new fast-track route. London councils should also develop forward plans for BtR delivery across their boroughs.
The report highlights continued challenges around getting regulatory approval for schemes. Latest government data shows a significant improvement in turnaround times for approvals at the first and second of the BSR’s three “Gateway” stages, which must be satisfied before construction is allowed to commence. BusinessLDN is calling on the Regulator to build on this progress to avoid further bottlenecks to delivery at the third Gateway, which is the final approval required prior to residents moving into new homes.
Looking at other findings in the report, PriceHubble aggregated and benchmarked demographic data covering 40 BtR schemes across London against comparable data from the wider private rented sector (PRS) to understand whether renters choosing BtR differ from the wider rental population. Its findings show that:
- BTR is especially popular among students, with this cohort representing 32 per cent of renters across the BtR developments analysed, compared to 9% in the wider PRS. Those working in the finance and professional services industries are well represented among renters choosing BTR and the wider PRS (28 per cent and 27 per cent of occupiers respectively), as is the tech sector (13 per cent and 10 per cent) and the public sector (10 per cent and 13 per cent).
- Age demographics of BtR occupants across the data set track the wider rental market very closely: 25 – 34 is the most common age bracket for occupiers in both BTR (51 per cent) and the wider PRS (49 per cent), followed by 16 – 24 (25 per cent and 24 per cent for BTR and PRS respectively) and 35 – 44 (16 per cent and 17 per cent).
- The average monthly cost of renting a BtR property across the developments analysed aligns closely with similar-sized PRS homes, especially for one bed flats (£1,978 and £1,884 respectively) and two bed flats (£2,423 and £2,229 respectively).
Brendan Geraghty, CEO of the Association for Rental Living (ARL), said:“The Who Lives in Build-to-Rent reports have become established over five years as highlighting trends in BTR living. This report shows again that BTR delivers quality new homes for rental that meet a range of demographic and affordability needs.”
Sandra Jones, managing director at PriceHubble, said: “We’ve run this research for five years now, comparing ‘who lives in BTR’ with the wider private rental market and it has consistently shown that the BTR sector provides homes for a broad cross-section of renters. It is neither correct, nor reasonable to assume that it caters exclusively for high income renters. Add to that, the growing focus amongst investors and providers on meeting the needs of the ‘squeezed middle’ of renters (key workers and middle earners) – and it is clear that the BTR model has an important role to play in securing London’s private rental sector.”
Kate Butler, assistant director of policy at Real Estate: UK, said: “Build-to-Rent has a crucial role to play in not only helping London to deliver the new homes the city so desperately needs at a pace and scale, but in providing a rental offer which actively aligns with the overarching need of business to attract and retain a dynamic workforce to support the capital’s continued economic growth. However, despite the clear benefits to London’s economy, and its role in solving the capital’s housing crisis, BTR has continued to face significant delivery headwinds, including viability challenges and regulatory delays. This has been compounded of late by the chilling effect continued speculation around the introduction of rent controls in the private rented sector is having on BTR investor sentiment, and in addition to measures to improve deliverability for BTR, we would urge the government to continue to rule out the introduction of any measures which would further undermine this critical housing tenure.”
The groups say that without significant reforms, City Hall will continue to struggle to hit its housebuilding targets as developers struggle with financially unviable schemes.
A spokesperson for the Ministry of Housing, Communities and Local Government (MHCLG) said: “The Building Safety Levy will help raise funds to ensure homes are safe. We delayed the implementation last year to give developers more time to prepare, while also reducing BSR delays – with new build approvals rising by 40 per cent between February and April.”
Highlights:
- A group of organisations have called on the Mayor of London and ministers to intervene in order to save the delivery of build-to-rent (BTR) properties across the capital
- New analysis shows that the number of BTR homes under construction has fallen by almost a third in the last year alone, from 17,138 in Q1 of 2025 to 12,134 in Q1 this year
- They are also calling on City Hall to adjust emergency housebuilding measures introduced this year to include BTR developers among the beneficiaries of grant funding
- The groups have also called on ministers to pause the implementation of the Building Safety Levy
