According to research from Foxtons, which looked at build-to-rent completions since 2018, and compared to the total private rented stock (PRS), this is the largest proportion of market share since 2018.
It describes a property development purpose-built to be rented rather than selling to individual homeowners. It is usually owned by institutional homeowners or property management companies.
The research reveals that build-to-rent completions came to 31,409 in 2018, making up 0.6 per cent of the five-and-a-half million privately rented homes in the lettings sector.
The sector has grown consistently every year since then and now sits at 100,372 as of 2023. This is 1.8 per cent of all UK PRS stock. The report said that this represents a 69 per cent increase in such completions since 2013.
Foxtons added that the scheme has made up one per cent or more of the UK PRS since 2020, figures show.
The growth in London is also impressive, increasing from 1.8 per cent of London PRS in 2018 – equal to 18,160 completions – to 4.2 per cent of London’s PRS in 2023. This equates to around 46,747 completions.
From a regional perspective, which excludes London, there has also been impressive growth, rising from 0.3 per cent of PRS in 2018 to 1.2 per cent now.
Build-to-rent demand will grow
Sarah Tonkinson, Foxtons Institutional PRS and build-to-rent managing director, said that there had been “phenomenal growth” in the build-to-rent sector in recent years, especially in London.
“However, it’s fair to say that the sector still remains in its relative infancy, and so the potential for further growth is vast. With a move towards longer-term renting until later in life, tenants expect more both with respect to the quality of rental accommodation available, and the security and certainty that long tenancy agreements provide them.
“With the build-to-rent sector offering this, and more, we only anticipate demand to increase and for stock levels to follow suit in order to satisfy the evolving needs of renters,” she added.
