Build to rent starts fall 63%

The supply of new homes for tenants is under pressure, with build to rent construction starts falling by 63% in a year.

Research prepared by Savills for Real Estate:UK found that 4,696 homes were started in the 12 months to September, down from 12,674 a year earlier.

Outside London, the fall was steeper still, with starts down 78%.

The industry group is calling for targeted tax and regulatory changes, arguing that the Budget failed to address the costs holding back development.

Housing supply warning

Danny Pinder, a director of Real Estate:UK, said: “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.

“We are seeing wider commentary around developers withdrawing from London with stats pointing to a more acute picture for delivery in the regions.”

He added: “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.”

Construction pipeline shrinks

Annual completions rose by 21% to 21,979 homes, with completions exceeding starts for the eleventh consecutive quarter.

However, the number of homes under construction fell by 30% nationally over the year to September, including a 28% decline in London.

Although the number of homes with consent increased slightly over the year, schemes at the detailed application stage fell by 9% between the second and third quarters of 2026.

The group attributes the pressure on development to construction and financing costs, planning and regulatory delays, and the cumulative burden of taxes and levies.

Tax changes sought

The organisation’s proposals include restoring stamp duty land tax multiple dwellings relief for high-density housing and zero-rating VAT on rents.

It also points to delays involving the Building Safety Regulator and costs arising from the design of the government’s property registration service.

Build to rent accounts for 8% of new homes, while the group warns that proposed tax changes for individual landlords could put further pressure on private rented supply.

Investor interest continues, with almost £300 million committed to suburban single-family housing development across five English regions.