The UK build to rent (BTR) sector attracted £800m in investment in Q3 2024, a notable increase compared to the same period last year, Savills reveals.
Savills’ latest UK BTR data shows that single family housing (SFH) led the way, representing a record 50.4% of total investment.
The surge in investment has been driven by bulk and single site transactions, as investors seek scale to establish essential operational infrastructure.
Bulk deal investments reached £1.2bn in the year to Q3 2024, representing half of the £2.4bn invested in the SFH sector.
Single site schemes also saw significant growth, rising from £0.27bn to £1.2bn.
Savills says as homeowners and BTL investors’ sales rates slow, institutions are seizing the opportunity to enter the market.
House builders have restructured their business models and formed private rented sector (PRS) partnerships, demonstrating long term commitment to SFH.
Savills says this shift acknowledges that sales rates may not return to previous levels.
Savills head of UK BTR research Guy Whittaker says: “The rapid growth of single site transactions alongside bulk deals shows that the recent rise in investment is a longer-term trend, rather than just a reaction to a softer sales market.”
“Viability remains a hurdle in the current climate, with elevated debt and construction costs, as does the planning system, particularly in London. If these obstacles can be navigated, there is no shortage of investor demand to deliver new homes for rent, with more and more investors reallocating capital from other commercial real estate sectors into living.”
