Foxtons, London’s leading estate agency, has unveiled groundbreaking insights into the Build to Rent sector, highlighting its remarkable ascent to nearly 2% of the entire UK’s private rental market, with a striking 4.2% in London alone. This surge represents the most substantial market share since 2018, signaling a pivotal shift in rental housing trends.
The agency’s meticulous analysis traces the trajectory of Build to Rent completions from 2018, the earliest point of comprehensive data, showcasing the sector’s dynamic expansion. Foxtons’ dedicated team, boasting unparalleled expertise and a successful track record, collaborates closely with developers to craft strategic letting solutions, emphasising optimal rental pricing, tenancy durations, and renewal rates.
In 2018, the Build to Rent sector comprised a modest 0.6% of the UK’s 5.5 million privately rented homes, with completions totaling 31,409. However, the sector has witnessed consistent annual growth, with 2020 marking a milestone as the number of Build to Rent units surpassed 1% of the total market for the first time, reaching 58,844 units. By 2023, this figure soared to 100,372 units, a 69% increase since 2013, in stark contrast to the mere 3% growth in the overall private rental stock during the same period.
The London market, in particular, has seen substantial growth. Build to Rent’s share of the capital’s private rental sector climbed from 1.8% in 2018 to 4.2% in 2023, with completions up by 61% since 2018. This growth underscores the sector’s increasing significance in London’s rental landscape.
Sarah Tonkinson, Managing Director of Foxtons Institutional PRS and Build to Rent, reflected on the sector’s rapid development, especially in London, noting the unprecedented rise in Build to Rent completions and their growing slice of the total private rental market. “We’ve seen phenomenal growth across the Build to Rent sector in recent years, particularly within the London market and, as a result, Build to Rent completions now account for their highest proportion of total PRS stock,” she said.
Despite its burgeoning presence, Tonkinson believes the sector is still burgeoning, with immense potential for further expansion. She highlighted the evolving preferences of tenants who are increasingly seeking quality accommodations and the stability offered by long-term leases—needs that the Build to Rent sector is uniquely positioned to fulfill. “With a move towards longer-term renting until later in life, tenants expect more both with respect to the quality of rental accommodation available, and the security and certainty that long tenancy agreements provide them,” Tonkinson added, projecting a rise in demand and subsequent stock levels to meet the changing requirements of renters.
