High-end lettings agency Knight Frank is predicting that £75 billion of investment will be committed to the Build To Rent sector by 2025 – and it says “more is needed”. 

In a survey of the current rental market, the agency says there are currently 29,416 professionally-managed BTR units completed, and the current supply pipeline of BTR units is 110,092 under construction or in planning.

Knight Frank – which has a consultancy side that works with BTR developers – says “more is needed” in terms of purpose-built units.

Against the context of buy to let landlords exiting the sector thanks to greater fiscal penalties and stricter regulation, the agency says the scope for BTR to grow is strong because demand for rental accommodation is still rising – it says an additional 560,000 households are expected to be living in the private rented sector by 2023. 

This would take the total proportion of the housing market to 22 per cent, up from 20.6 per cent today.

“We are seeing a significant number of individual private buy-to-let landlord exiting the market as the government’s buy to let tax changes start to bite. Large-scale professional [BTR] landlords are well placed to absorb this, as well as satisfying some of the structural shortfall in our housing supply” explains Nick Pleydell-Bouverie, head of residential investment agency.

“A principal constraint on the delivery of housing is the estimated rate of sales for developers. The institutional [BTR] market can significantly accelerate this through near immediate absorption. It is crucial that the UK Government resists further legislation and taxation and enables the market to significantly contribute towards the UK housing challenge” he adds.