The number of build-to-rent homes completed in the UK fell last year by nearly a fifth, according to latest figures from the British Property Federation (BPF).
But while the COVID-19 pandemic had caused work on many sites to stop, the sector still produced 10,152 homes, which equates to a bigger share of completions than in 2019.
The drop of 18% in completions was less than the 23% drop reported by the National House Building Council (NHBC) for housebuilding overall.
The figures also show that the number of build-to-rent homes produced in London actually increased sharply in 2020, up by 58% to 5,558.
The rise softened a significant drop in completions outside of the capital, with the figure nearly halving from 8,910 in 2019 to 4,594 in 2020.
The growth in London meant purpose-built homes for rent accounted for 18% (nearly a fifth) of all homes completions in the capital.
Nationally, build-to-rent accounted for around 4% of all completions.
In total, the BPF said, more than 50,000 build-to-rent homes have now been constructed in the UK, from a standing start less than a decade ago.
The BPF’s figures also showed continued growth in the number of homes under construction or in the planning pipeline, up 5% and 22% respectively.
By the end of last year, 37,050 homes for rent were under construction, with a further 89,035 in the planning stages.
The growth in schemes under construction and in planning came almost entirely within regions outside of London, with the capital seeing almost no change in its figures.
The BPF said the figures also showed an increasing shift to homes for rent in suburban locations, with around one in 10 completed build-to-rent homes outside of city centres.
‘A significant opportunity’
Ian Fletcher, director of real estate policy at the BPF, said: “The build-to-rent sector has shown its resilience throughout 2020, with investors continuing to drive the sector’s growth across every region of the UK.
“The quantum of planning applications in London, however, is static, suggesting that the capital is having to compete more for investment.
“There remains a significant opportunity for the sector to increase its share of completions in our regional cities and towns, further supporting local housing supply ambitions, and this will include more suburban houses that families can call home.”
Jacqui Daly, director or Savills residential research – one of the organisations who collected the data for the BPF – said: “Our analysis has identified a pipeline of 8,500 suburban homes in planning and under construction that will help meet this demand for rental homes in locations that can combine more space, good amenities, and connectivity.
“We expect suburban schemes to play a key role in delivering homes in 2021 and in providing high-quality rental housing in regional markets, helping to address housing need, particularly for young families.”
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