A new report suggests London’s Build To Rent sector is being held back by a “stark inconsistency” from local councils in the capital.

The report, by national consultants Lichfields, says planning policy across all London boroughs is mixed and “could do far more” to support the delivery of more BTR units. 

It says a key finding highlights a stark inconsistency in how BTR is addressed in Local Plans: of the 35 local planning authorities in London, 46 per cent make no reference at all to BTR in their plans.

Some 41 per cent of all bespoke BTR developments secured via specific planning applications are in just four boroughs – Brent, Newham, Ealing and Enfield.

Adam Donovan, a co-author of the Lichfields report, says: “Boroughs must adopt a more proactive approach and align their planning policies to genuinely harness the benefits of Build to Rent. In failing to do so, the BTR sector in London is being detrimentally affected despite the high demand for secure, well managed rental properties. If local authorities developed a bespoke policy for BtR developments, the sector would become a lot stronger and more stable, helping to meet the chronic housing need in the capital.”

The report claims that local borough policies consistently fail to differentiate between ‘for sale’ housing and BTR schemes, meaning applications for BTR are assessed against policy designed for private sale developments. This creates a requirement for each planning application for BTR to provide individual justification, which makes the planning process more complex than it needs to be.

Ben Kelway, another co-author at Lichfields, adds: “What is needed is a greater differentiation in development management policies and more flexibility in their application to assist in the delivery of BtR schemes. In particular, policies covering design standards, amenity space requirements and dwelling mix should reflect the specificities of BtR.

“BTR policy has come a long way in the last 10 years as the sector has matured and continues to grow. However, the planning system at a local authority level could do far more to promote and facilitate BtR developments in London. The opportunities presented by good quality BtR developments in the right locations are significant in terms of housing delivery, affordable housing and London’s communities.”

This is the second report on BTR in recent days identifying problems in London.

A study by the British Property Federation released last week says: “Sharp increases in build and financing costs are stalling delivery in London.”

The analysis, conducted in partnership with Savills, shows that the total number of BTR homes completed or in the pipeline across the UK rose to 263,694 at the end of Q3 2033, up 11 per cent year-on-year. The number of completed homes increased by 11 per cent to 82,660 while the number of units under construction and in planning increased by 12 per cent to 52,852 and 10 per cent to 102,042 respectively.

But the study complains that in London, increases in build and financing costs are having a severe impact on the delivery of larger, more capital-intensive schemes. 

New starts in the capital totalled just 434 units in Q3, and 266 units in Q2. Units under construction increased just five per cent year on year in Q3.