Build-to-rent starts across the UK fell by 63% in Q3 2026 compared with a year earlier, according to Savills research prepared for Real Estate:UK.
Annual starts on site dropped to 4,696 from 12,674 during the first 100 days of Burnham’s time as prime minister, with the regions recording a 78% fall.
Real Estate:UK released the figures immediately after a Budget that focused on boosting homeownership to revive flagging starts. The industry group is calling for urgent action on a viability crisis it says is severely affecting the supply of new rented homes, and warned that concerns over private rented sector supply are mounting after proposed tax changes for individual residential landlords.
“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,” said Danny Pinder, director at Real Estate:UK.
“We are seeing wider commentary around developers withdrawing from London, with today’s stats pointing to a more acute picture for delivery in the regions.”
Build-to-rent starts trail completions
Annual completions of 21,979 exceeded starts for the eleventh consecutive quarter, as the pipeline of new homes for rent shrinks under rising construction and financing costs, planning and regulatory delays, and the cumulative impact of taxes and levies on development viability.
Completions ran 21% higher in the twelve months to Q3 2026 than the 18,204 recorded a year earlier. Combined with the slump in starts, that left the number of homes under construction down 30% nationally, with London falling 28% and the regions 30%.
The pipeline looks weaker too. Consented units rose slightly year-on-year, but the number of schemes at detailed application stage fell by 9% between Q2 and Q3 2026, which will affect longer-term supply.
Real Estate:UK links the drop to viability pressures compounded by political uncertainty over issues such as potential rent controls. It also points to delays at the Building Safety Regulator and unnecessary costs arising from the design of the “Register your rental property service”. The Budget dashed hopes that the government would tackle these issues, falling short of the bold steps needed to unlock development.
With financing costs prohibitively high for build-to-rent, the industry group wants targeted tax and regulatory measures to kick-start development. It argues that a number of cost-effective interventions would address viability, unlock investment and drive economic growth, including restoring SDLT multiple dwellings relief for high-density housing and zero-rating VAT on rents.
Despite the fall in new starts, the sector accounts for 8% of new homes, nearly 1 in 10, and supports the government’s housing delivery targets. Real Estate:UK says this shows both the tenure’s contribution and the extent to which viability pressures affect the entire housing sector. It also describes the sector as one of the only mechanisms to increase supply and stabilise rental availability should the exodus of buy-to-let landlords continue.
Investor appetite for build-to-rent remains, with capital continuing to target operational assets. In single-family housing, almost £300 million has been committed to suburban development across five regions in England. The group says this demonstrates the sector’s ability to attract long-term patient capital, although it adds that targeted public-sector support will be needed to unlock further development, particularly in multifamily.
“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,” Pinder said.
“The Budget gave details on the Government’s revised ‘Help to Buy’ scheme, which may in time prove to be a shot in the arm for the private for sale market, but, at £4.7bn, is a costly intervention to unlock 20,000 new homes and one that does nothing to address structural issues constraining supply.
“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. This requires targeted intervention to ease the tax and regulatory burden that is stalling development of not only homes for rent, but also broader property development across the UK.”
