The supply of new Build to Rent has risen from under 1,000 new homes a year in 2004 to just under 90,000 homes in large cities in 2024 (14 per cent of new homes), demonstrating the increasing contribution it is making to tackling housing shortages, Centre for Cities says.
Its analysis shows that London accounts for the largest share of Build to Rent (BtR) stock at 44 per cent of the national total, followed by Manchester at 17 per cent and Birmingham at eight per cent.
BtR is still a relatively small share of total national housing stock and predominantly focused in London and other urban areas. But analysis suggests BtR could provide a larger segment of housing in big cities, which typically have been difficult to build in.
In most cities outside of London over half of BtR stock is concentrated in city centres and adjacent neighbourhoods, though there may be a role for BtR out of the city centre where it can provide rental accommodation on sites within commuting distance, as it does in the capital.
To use BtR more effectively to meet the Government’s 1.5 million new home target:
- National policymakers should amend minimum space standards to address under-supply of single-person or studio flats. Data suggests there is demand, for smaller, cheaper studios but current regulations stop BtR properties from meeting this demand.
- Local policymakers should encourage the development of BtR units around transport hubs in the suburbs of large cities, and carefully manage competing residential and commercial uses of space in city centres so that the former doesn’t crowd out the latter
Centre for Cities’ analysis is launched today at the UK’s Real Estate and Infrastructure Investment Forum in Leeds in partnership with DAC Beachcroft.
Andrew Carter, Chief Executive of Centre for Cities, said: “The Build to Rent category has emerged as a new tool for building more private sector homes in our big cities – a task the UK has struggled with since the Second World War.
“Britain has a backlog of 4.3 million missing homes. Build to Rent is playing an increasing role in addressing this backlog and has the potential to do more.
“The trend for Build to Rent additions in big cities reflects the improvements in the urban living offer that has occurred in our big cities over the last decade. Cities wanting to attract Build to Rent to their areas will need to ensure they also have a compelling urban living offer that will attract those wanting to live in these types of homes as well as build them.”
Gemma Leonard, Head of Development at DAC Beachcroft, said: “BtR’s growth over the past two decades has been rapid, now accounting for 14 per cent of housing growth in the UK’s major cities. Young professionals currently make up the majority of tenants, and their positive experience of professionally managed housing – along with the potential need to accommodate growing families – is likely to drive further growth in single-family BtR developments.”
