Investment in the UK build-to-rent (BTR) sector reached £2.2bn in the first half of 2025, with single family homes accounting for a record 60% of all BTR investment in the second quarter, according to the latest industry data from JLL.
Over £800m has been invested in single family BTR assets so far this year – including more than £575m in Q2 alone.
However, multifamily BTR investment slowed in Q2 following robust activity in Q1 and the final quarter of 2024. H1 2025 multifamily investment totalled nearly £1.4bn, but almost three quarters of that took place in the first quarter.
Despite a slowdown in the second quarter, several transactions currently in negotiation suggest the potential for increased activity in the second half of the year, according to JLL.
Overall, BTR investment in the first half of 2025 was 11% below the five-year January–June average, and 22% lower than the same period last year.
The development pipeline for new multifamily BTR schemes in London has slowed considerably. Higher risk buildings regulation – in particular, the Gateway process for buildings over 18 metres – has added time and cost, leading to a significant fall in new project starts.
Fewer than 100 BTR units have broken ground in London so far this year, according to Molior London, with just over 1,800 starts in the past 12 months. This represents a 65% drop on the five-year average. The number of units under construction across the capital has fallen by 23% over the past year, with 10,600 units now underway, compared with an average of 16,600 units between 2018 and the end of 2023.
Marcus Dixon, head of UK living and residential research at JLL, said: “Investment in the UK build-to-rent sector hit £2.2bn in the first half of 2025. The pendulum, which had swung firmly towards multifamily investment in Q1, shifted to single family in the second quarter.
“Viability challenges and difficulties in progressing schemes through the Gateway process are clearly impacting activity in the multifamily sector. While some investment has been redirected to single family, it’s worth noting that the quieter Q2 for multifamily followed two particularly active quarters.
“With numerous deals in the pipeline, we anticipate a potential uptick in activity as we move into the second half of the year.”
