The ARL stresses that without intervention, the consequences are clear – slower housing delivery, reduced rental supply, increased affordability pressure and greater reliance on short-term or lower-quality stock, calling on the Government to now restore confidence and recalibrate viability for institutional investors by:

+ Providing long-term policy stability and avoiding further cumulative regulatory layering without economic assessment.

+ Designing a planning system that supports delivery, with clarity and speed including classifying housing as critical infrastructure, explicitly recognising Build to Rent within planning policy, mandating local plans to include specific policies on Build to Rent, and introducing mandatory targets for purpose-built rental homes within local authority housing targets.

+ Devising a proportionate regulatory and tax framework that recognises the economics of large-scale rental with the reinstatement of Multiple Dwellings Relief for Stamp Duty Land Tax and the rationalisation of selective licensing regimes.

The ARL says it recognises these policy changes may take time but calls on government to publicly recognise and state support for institutional investment in UK BTR now, and acknowledge the viability challenges being faced in order to give investors greater confidence that the Government is committed to making the UK a good place to invest.

The full letter can be read below.

Open letter to government calling for immediate support for the UK Build to Rent sector

27^th February 2026

Dear Minister, 

 

The investment viability challenge for Build to Rent housing 

 

We write following the recent announcement of the withdrawal of the John Lewis Partnership (JLP) from its Build to Rent property business, calling upon the Government to take sharp notice of this deeply disappointing news and take immediate action to support the UK Build to Rent sector.  

 

This is not about one business model. It is about viability. A compounding set of regulatory and market dynamics have decimated the viability of investment in building much-needed additional new rental homes.  

 

Across the sector, schemes are being slowed, redesigned, or withdrawn.  Elevated construction costs, higher interest rates, softer yields, expanded Section 106 expectations and cumulative regulatory change have materially compressed margins. Institutional capital requires stability to price risk.  

 

Institutional capital is mobile. If UK risk-adjusted returns fall below threshold, it reallocates internationally or into alternative sectors. The recent withdrawal we have witnessed is a symptom of a broader structural viability squeeze affecting BTR investors and developers across the board. 

 

Without intervention, the consequences are clear – slower housing delivery, reduced rental supply, increased affordability pressure and greater reliance on short-term or lower-quality stock. 

 

If we want more high-quality rental housing to contribute to national housing targets, Government must now restore confidence and recalibrate viability by: 

 

Providing long-term policy stability and avoiding further cumulative regulatory layering without economic assessment. 

 

A planning system that supports delivery, with clarity and speed. Housing needs to be classified as critical infrastructure, with Build to Rent explicitly recognised within planning policy, with certainty around affordable housing calibration and accelerated pathways for brownfield regeneration. All local plans must include specific policies on Build to Rent, and mandatory targets introduced for purpose-built rental homes within local authority housing targets.   

 

A proportionate regulatory and tax framework that recognises the economics of large-scale rental.  We again call for the reinstatement of Multiple Dwellings Relief for Stamp Duty Land Tax to reflect the economics of large-scale rental delivery, and the rationalisation of selective licensing regimes so that professionally managed blocks are treated proportionately. 

 

Recognising these policy changes take time, we call on Government to publicly recognise and state support for institutional investment in UK BTR and recognise the viability challenges being faced – to give investors greater confidence that the Government is committed to making the UK a good place to invest. 

 

Build to Rent has delivered more than 146,000 professionally managed homes and has capacity to deliver significantly more, including affordable housing at scale. It provides permanent professional management, consistent standards, long-term stewardship and institutional accountability. It is exactly the form of housing the UK should be encouraging. 

 

We stand ready to work with the Government to recognise, redefine and revalue what Build to Rent delivers for society, communities and the housing market as a whole, and to create a housing system that incentivises rather than thwarts institutional investment. Let’s seize the opportunity together. 

 

Yours sincerely 

 

Brendan Geraghty 

Chief Executive Officer

Association for Rental Living