New research by the British Property Federation (BPF) shows that the number of build to rent homes currently under construction across the UK’s regions is nearly double that to London.
The build to rent sector is experiencing a surge of activity across the UK with Manchester and Salford collectively boasting the largest number of new rented homes under construction outside London.
This is the first evidence of momentum for build to rent outside London, a sector which only recently received proposed recognition in the National Planning Policy Framework as set out in the government’s Housing White Paper. The real estate industry welcomed the support from national government, which in effect should ensure local authorities across the country better plan for build to rent in their local plans.
The research shows, however, that London continues to see the strongest longer-term figures. The capital has 38,648 build to rent homes either complete, under construction or in planning, versus 31,176 in the regions.
Investors spearheading the nascent sector have found achieving scale to be a significant challenge. While there is room for major improvement, the research shows that the size of build to rent developments is generally getting larger. Twenty-four developments currently in planning will deliver over 500 new rented homes each, whereas completed developments up until now have mostly delivered under 100 homes each.
Ian Fletcher, Director of Real Estate Policy, British Property Federation said, “The UK’s build to rent sector has reached a significant milestone today, proving for the first time that the sector is making its mark across the regions. While the government now better recognises that we need a housing sector firing on all cylinders across the UK, our data is a timely reminder of build to rent’s contribution to solving the housing crisis. This research will further professionalise the sector, ensure it is transparent and allow us to track its growth at a time when housing is at the top of government’s agenda.”
Andrew Stanford, Head of UK Residential at LaSalle Investment Management and chairman of the BPF’s Build-to-Rent Committee added, “An ability to invest at scale was cited as a key barrier to the growth of the build to rent sector by the Montague Review in 2012. The BPF’s analysis is encouraging because it demonstrates that high quality, fit-for-purpose build to rent schemes are no longer a rarity across the UK. Options for investors have noticeably increased across the country for those willing to be involved in the development process. This bodes well for the rapidly maturing sector.”