Housing emergency: Lack of progress on Scottish build to rent ‘alarming’ as UK powers ahead

Scotland’s build to rent market is “stuck in the pipeline”, with an estimated 14,000 new homes held up in the planning process and at increased risk of not being delivered, property experts have warned.

Build to rent (BTR) involves institutional funds purchasing and building out sites to provide new residential accommodation quickly and at scale. To date, thousands of properties have been delivered in Scotland, including Moda Living’s 433-unit Holland Park development in Glasgow, and Platform completing the first phase of its flagship development at Bonnington in Edinburgh, with 365 apartments.

However, releasing his latest report on the sector, John Boyle, director of strategy and research at property firm Rettie, said: “In the face of a housing emergency across the country, the lack of progress on build to rent is alarming, particularly given the speed and development in other UK cities.

This year, build to rent (BTR) schemes completed in Scotland include Moda Living’s 433-unit Holland Park development in Glasgow.

“A major reason for the deadlock is around political risk. Unfortunately, investors have tagged Scotland with a risk premium due to concerns about future legislative and tax changes. In no small part, this stems from the introduction of the rent freeze in 2022, with no prior consultation or warning, and the risk premium has remained high due to the prospect of a national system of rent controls proposed in the new Housing (Scotland) Bill, which is progressing through Parliament.”

He added: “Strong underlying market fundamentals have kept Scotland’s BTR sector alive, but there has been very slow progress over the last year and no new investment in the sector for the best part of two years. While a number of schemes have achieved completion over the last 12 months, to date 2024 has seen the fewest number of new BTR units entering the pipeline since 2015.”

According to a recent report by property consultancy Colliers, Edinburgh and Glasgow should be positioned first and second in the whole of the UK in terms of the attractiveness for residential investment.

Boyle added: “Revisions to the Housing Bill will be required to breathe life back into the sector, otherwise build to rent will continue to happen in the rest of the UK, but not here.”

500 Glasgow flats with riverside views up for rent