London’s Build to Rent Planning Defies National Trends

London is experiencing a notable increase in Build to Rent (BTR) planning activity, even as the rest of the UK faces a slowdown. According to Foxtons’ analysis of Q3 2025 planning data, the capital’s BTR planning volumes have risen by 8.5% year on year. Nationally, the total number of BTR homes in the planning pipeline stands at 106,406, a modest 2.1% increase compared to the previous year. However, this growth is uneven, with London driving the positive momentum while regional markets see declines.

Cooling Appetite for BTR Outside London

Sarah Tonkinson, managing director of institutional PRS and BTR at Foxtons, commented on the shifting landscape: “The Build to Rent sector has established itself as a vital component of the UK rental market, but the latest figures suggest that appetite for new development is cooling outside of London.” She noted that economic headwinds, rising construction costs, and planning delays have dampened activity in regional areas.

Despite these challenges, London remains resilient. Tonkinson added, “We’ve seen consistent growth in planning numbers across the capital, reflecting both the strength of rental demand and the long-term confidence investors hold in the London market.” She highlighted that affordability pressures in the for-sale housing sector continue to support demand for rental homes, with BTR developments in London positioned to meet this need.

Regional BTR Planning Declines

While London’s BTR planning volumes have grown, the regions tell a different story. In 2024, BTR schemes outside London expanded by an average of 1.9% per quarter. However, this trend reversed in 2025, with average quarterly planning activity falling by 1%. Annually, regional BTR planning levels are down by 1.4%, with a sharper quarterly decline of 2.9% between Q1 and Q3 2025. This contrasts with the 1.8% quarterly growth seen throughout 2024.

These figures suggest that outside the capital, developers and investors are more cautious, likely responding to the economic and regulatory pressures affecting the wider UK market.

London’s Leading Role in BTR Delivery

Foxtons’ data shows that London accounted for 37.2% of all BTR schemes in planning during Q3 2025, a share that has steadily increased since mid-2024. The capital’s average quarterly growth rate of 2.6% in 2025 slightly surpasses the 2.4% pace recorded in 2024, indicating sustained momentum.

For landlords and letting agents, this means London remains a key area for new rental housing supply, helping to address tenant demand amid ongoing affordability challenges in home ownership. The continued confidence from investors also signals potential stability and growth opportunities within the London rental market.

What This Means for UK Landlords

The divergence between London and regional BTR planning activity highlights the capital’s unique position in the UK rental sector. For landlords, this suggests that London will continue to see an influx of professionally managed rental homes, which may influence local rental market dynamics and tenant expectations.

Meanwhile, the slowdown outside London could mean fewer new BTR developments in regional areas, potentially affecting rental supply and competition. Landlords and agents should monitor these trends closely to adapt their strategies accordingly.

Suggested internal link anchors

• Build to Rent sector
• rental demand in London
• PRS market trends
• planning applications for rental homes
• affordability pressures
• investment in London rental market
• regional Build to Rent developments
• construction costs impact
• tenant demand
• rental housing supply

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