Analysis from the British Property Federation and Savills pinpoints slow construction as the biggest obstacle, especially for properties in London.
The research, which was published this week, begins on a positive note. The experts found that within the last year the number of newly constructed built-to-rent homes has skyrocketed. Over 17,000 properties were completed between the first quarter of 2024 and the first quarter of 2025, bringing the total number to 127,150.
Though the optimistic tone didn’t last long as the research likewise highlighted that progress has significantly slowed. For the fifth quarter in a row, completions have outstripped starts on site, resulting in a 14% contraction in the number of homes under construction nationally.
On a regional level London has experienced the greatest fall. Figures were discovered to be down 18% year-on-year to just 15,000 homes under construction, while the regions dropped by 12% to 34,870.
To give context on how worrying the statistic is, separate research shows London needs around 66,000 new homes per year to meet current and future needs, with two-thirds of them needing to be earmarked as affordable. What’s more, their growing homelessness crisis also signals more affordable properties are needed now, more than ever.
Within Britain the number of homes granted consent to begin construction has increased by 13% over the last year and the total number of properties in planning and pre-consent has grown by 5% to 109,920 units. However, detailed planning applications have dropped 16% since last quarter.
According to experts, a number of reasons are contributing to the snail’s pace in progress. For example delays at the Building Safety Regulator and the cost of inflation have been listed as driving forces.
‘Completions remain robust, and planning activity is holding up well, but the sector is facing a real bottleneck in progressing schemes through to construction,’ Melanie Leech, chief executive of the British Property Federation said. ‘Viability challenges, coupled with continued uncertainty around project timelines are slowing momentum just at a time when rental demand is rising sharply. Investor appetite is there but unlocking it will require a concerted effort to support the delivery of BtR homes.’
‘Urgent action is needed in particular to deal with the pipeline blockage currently being caused by the Building Safety Regulator,’ she continued.
‘The outlook for the remainder of the Parliament could be more positive, with specific support for Build-to-Rent expected as part of the Government’s long-term housing strategy. Tackling backlogs and delays at the Building Safety Regulator, combined with planning reforms starting to bed in, could help provide more certainty around delivery. There’s no doubt that the sector’s ability to rapidly deliver high-quality, professionally managed homes will remain a vital part of the UK’s housing mix and the Government’s ambitious 1.5 million homes target.’
The full report can be accessed here.
Photo by Youssef Abdelwahab via UnSplash
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