New build-to-rent housing starts in the UK regions outside London have fallen by 84% in the year to June 2026, according to data from Savills prepared for investment platform Real Estate:UK.
Nationally, the number of new build-to-rent homes decreased by 79% over the same period, representing one of the sharpest declines in the sector’s recent history.
Regional decline outpaces capital
The statistics show new build-to-rent starts in the regions dropped to 2,176 from 13,893 in the previous 12-month period. For schemes under construction, the number of homes fell by 21% nationally in the three months from April to June 2026 compared to the same period in 2025. London experienced a 27% decline, whilst regional schemes fell by 19%.
Despite the sharp reduction in new starts, build-to-rent continues to account for nearly one in 10 new homes delivered in the UK, at 8% of total housing output.
Viability pressures cited
Savills attributed the decline to viability pressures, alongside uncertainty created by speculation around potential rent controls and a possible Land Value Tax. The sector has also faced challenges from the cladding crisis, with some build-to-rent operators diverting capital from new developments to fund remediation works.
Danny Pinder, Director at Real Estate:UK, said: “The Q2 2026 delivery figures have shown one of the sharpest declines in the number of new start-on-sites yet, and undoubtedly reflect the impact the viability crisis is having on the development of build-to-rent schemes across the UK.”
He added that the sharpest decline in starts within the regions provided “further evidence of the fact that, in most parts of the country, it is now unviable to bring forward new schemes despite strong underlying tenant demand.”
The deteriorating conditions mirror broader challenges facing the UK new homes market, where profitability pressures have intensified across multiple development sectors.
Investment outlook
Pinder noted that regulatory uncertainty has compounded viability issues: “We’ve also had increased regulatory uncertainty, through speculation around rent controls and other potential property taxation changes continuing to impact on investment considerations.”
The data suggests that whilst tenant demand remains robust, the combination of construction costs, regulatory uncertainty, and sector-specific challenges such as cladding remediation have created significant headwinds for new build-to-rent development, particularly outside the capital.
