Knight Frank has published its Q4 2025 UK Build to Rent (BTR) Market Update, highlighting a notable shift in the sector: for the first time, Single Family Housing (SFH) accounted for the majority of annual investment, surpassing Multifamily Housing (MFH).
Despite a year marked by challenging macroeconomic conditions, the report shows that BTR investment remained resilient, with growth in SFH transactions and continued expansion of operational stock across the UK.
In Q4 2025, £1.7bn was invested in the UK Build to Rent sector, providing a stronger-than-expected finish to a year shaped by challenging macroeconomic conditions affecting real estate investment more broadly.
Total annual BTR investment reached £4.7 billion, down 9.1% from the record £5.1 billion transacted in 2024 but still 23% above the ten‑year long-term average.
Investment in Single Family Housing (SFH) hit a record £2.6 billion across 44 deals, reflecting growing investor demand for lower-density, suburban rental stock.
The UK’s operational BTR stock expanded to 158,205 homes, a 16% increase year-on-year, with a further 51,755 homes under construction, positioning the sector to surpass 200,000 completed homes in the coming years.
In 2025, 22,000 new BTR homes were completed, roughly 20% fewer than in 2024, with SFH representing 25% of all completions, its highest share on record.
In contrast, delivery of Multifamily Housing (MFH) and co-living schemes fell 28% and 33%, respectively, as viability and regulatory pressures continued to challenge high-density development.
Looking ahead, Knight Frank forecasts just under 24,000 completions in 2026, suggesting a modest improvement on 2025 delivery.
Lizzie Breckner, head of BTR research at Knight Frank, said: “Our latest analysis shows a sustained and growing appetite for purpose‑built rental housing, with £1.7 billion invested in Q4 alone. While annual volumes have softened, reflecting recent policy uncertainty alongside pricing, debt and development pressures.
“Despite these challenges, confidence is gradually returning. The UK’s BTR stock continues to expand at pace, growing 16% over the past year, and the strength of the pipeline means the sector is on course to exceed 200,000 operational homes within the next few years.”
However, Knight Frank’s figures for 2025 show total Build-to-Rent (BTR) investment of £4.7bn, falling short of the £6bn projected in mid‑2025 by Lambert Smith Hampton (LSH) in its “Built to Last” report, published in May 2025.
While both reports highlight growth in Single Family Housing (SFH) and ongoing expansion of operational stock, Knight Frank’s data suggest that investment fell below the record-breaking levels anticipated by LSH.
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