The UK’s BTR investment hit £4.7bn in 2025

Build to Rent (BTR) investment in the UK reached £4.7bn in 2025, with a late surge in dealmaking helping the sector close the year stronger than many expected.

Data from Knight Frank show £1.7bn was invested in the final quarter, capping a year shaped by tighter financing conditions and wider economic pressure on real estate.

Even so, annual volumes still landed 23% above the long-term average, despite falling 9.1% from the £5.1bn record set in 2024.

It adds that the bigger story was a structural shift in where capital flowed as single family housing accounted for 55% of the total annual investment.

That led it to overtake multifamily housing for the first time.

The property consultancy says that single family housing attracted a record £2.6bn across 44 deals as investors leaned towards lower density, suburban rental stock.

BTR confidence returning

Lizzie Breckner, the head of BTR research, said: “Our latest analysis shows a sustained and growing appetite for purpose‑built rental housing, with £1.7 billion invested in Q4 alone.

“While annual volumes have softened, reflecting recent policy uncertainty alongside pricing, debt and development pressures.”

She added: “Despite these challenges, confidence is gradually returning.”

Jack Hutchinson, a partner in residential investments at Knight Frank, said: “Record capital inflows and its growing share of completions underline investor confidence in the depth and resilience of the SFH sector.”

Single family housing schemes

The research shows that around 22,000 new BTR homes were delivered during the year, roughly 20% below the 2024 peak.

A quarter of those completions were single family housing schemes, the highest share ever recorded.

However, delivery of higher density housing slowed sharply with multifamily output falling 28% year on year.

Co-living completions dropped 33% to reflect ongoing viability and regulatory challenges facing large urban developments, the firm said.

BTR stock grows

Despite the slowdown, the operational BTR market continues to grow as completed stock rose 16% over the year to 158,205 homes.

There’s a further 51,755 units under construction and the sector is expected to pass 200,000 completed homes within the next few years.

Looking ahead, Knight Frank expects just under 24,000 BTR completions in 2026, pointing to a modest recovery in delivery after a softer 2025.