Investment activity in the UK build-to-rent (BTR) market hit £4.5bn last year – making it the second highest year on record, according to new data from Savills.
Last year’s figure was just behind the £4.6bn racked up in 2022, with single-family housing accounting for 42% (£1.9bn) of total activity last year, up from just 8% in 2022.
More than 100,000 BTR homes completed in 2023, with a further 53,800 under construction and a future pipeline of 112,800.
Guy Whittaker, head of UK BTR research, Savills, said: “Despite the macro-economic challenges – elevated cost of debt and continued material and labour-cost inflation – the sector has proven resilient. The BTR market has seen continued growth due to the housing supply and demand imbalance and high levels of rental growth. This has led to inflation-matching returns while yields have proven comparatively strong.
“The fundamentals of investing in BTR remain sound with growing possibilities to leverage operational efficiencies from better data on portfolio performance and experience. This has put the sector in good stead for its next phase of growth and we project the sector will grow to reach 360,000 homes by 2033.”
