Last updated: 23/01/2026
With demand for quality rental housing growing across the UK, the build‑to‑rent (BTR) sector has expanded rapidly, becoming one of the most dynamic areas of residential property investment. According to Property Reporter, the number of purpose‑built rental homes in the UK has surged, increasing by around 173% over the past five years, with more than 123,000 BTR homes now completed and thousands more in development. Investors are increasingly turning their attention to this sector as a long‑term rental solution that aligns with evolving tenant needs and lifestyle preferences.
Where new homes are being built specifically for renting, there are new property investment opportunities — and more investors are considering build‑to‑rent as a core strategy for portfolio growth. Drawing on our extensive insight and experience as a dedicated property investment company, we’ve outlined the key benefits and considerations of this type of investment to help you decide if it’s the right opportunity for you.
Firstly, though, what are build-to-rent properties exactly?
Build-to-rent property investment guide
What is build-to-rent?
Build-to-rent (BTR) properties are residential developments designed specifically for renters, rather than owner-occupiers. Built with long-term occupancy in mind, these schemes focus on delivering a high-quality, convenient living experience, often incorporating modern amenities, well-designed communal spaces, and professional on-site management. The result is housing that appeals strongly to today’s renters while offering investors a more resilient, purpose-built rental product.
Unlike traditional buy-to-let homes, build-to-rent properties typically offer greater flexibility for tenants, including simpler renewal processes and shorter lease options, which helps attract and retain long-term occupants. This tenant-centric approach can support strong occupancy rates and consistent rental income.
Build-to-rent developments take many forms. Most commonly, they include apartment buildings, offering a range of unit sizes for individuals, couples, and families. Some schemes also feature townhouses or single-family homes, providing more space and privacy. Increasingly, BTR is delivered as part of mixed-use developments, combining homes with retail, leisure, or workspace, creating vibrant, self-contained communities.
The sector also spans student accommodation, senior and assisted living, co-living spaces, affordable housing, and premium luxury schemes, each designed to meet specific lifestyle needs. This diversity makes build-to-rent a flexible and future-focused investment, well-suited to evolving rental demand across the UK.
What is build-to-rent investment?
Build-to-rent investment refers to investing in purpose-built rental properties designed for long-term occupancy, rather than homes intended for sale to owner-occupiers. These developments are owned and operated by a range of investors, all drawn to the sector’s stability, scale, and growing tenant demand.
Many build-to-rent schemes are developed and managed by professional property developers, often working alongside institutional investors such as pension funds, insurance companies, and REITs. These investors value build-to-rent for its reliable income streams and long-term growth potential. Private equity firms and specialist real estate investment companies are also active in the sector, acquiring and operating developments as part of diversified property portfolios.
Build-to-rent is not limited to large institutions. Individual investors can also invest, either by purchasing units within larger developments or by partnering with experienced operators. In some cases, housing associations and non-profit organisations are involved, particularly in schemes that support affordable or mixed-tenure housing.
As explored below, Alesco helps individual investors access build-to-rent opportunities, offering expert guidance and support throughout the investment process.
What we like about build-to-rent investment
Investing in build‑to‑rent offers a range of advantages that make it a compelling choice for both new and experienced investors. Here’s why build-to-rent stands out:
Reliable, long-term income
Build-to-rent offers a stable source of rental income, thanks to steady tenant demand for purpose-built rental homes that combine convenience, quality design, and professional management. With rental housing demand remaining strong across the UK, BTR income streams tend to be consistent over time.
Growing sector and investment confidence
The UK’s build-to-rent sector continues to expand strongly. By 2025, there were over 130,000 operational BTR homes, with thousands more under construction or in planning, demonstrating robust investor confidence in this growing market. Investment in the sector reached record levels in 2025, with around £6 billion deployed across the UK, reflecting ongoing demand from both institutional and private investors.
This momentum has carried into 2026, making build-to-rent an increasingly attractive and future-focused investment opportunity for those seeking stable income and long-term growth.
High occupancy and tenant appeal
Build-to-rent developments are designed to attract long-term renters through flexible leases, modern amenities, and convenient locations — all of which support high occupancy rates and help minimise void periods. These tenant-centric features make BTR properties resilient, even during economic uncertainty.
Professional management reduces hassle
Because BTR schemes are usually managed by specialist teams, investors benefit from hands-off oversight, streamlined maintenance, and consistent tenant service — a major advantage over traditional buy-to-let setups.
Scalable investment opportunity
Build-to-rent allows investors to scale by owning multiple units within a development or across several sites, enhancing diversification and income potential without the complexity of managing scattered individual rentals.
Overall, these factors make build-to-rent a future-focused, resilient investment strategy that aligns with evolving rental demand and offers a compelling combination of income and growth potential.
The profit potential of build-to-rent investment
Build-to-rent properties offer a stable and profitable opportunity for savvy investors. Designed specifically for long-term rental, these developments provide high-quality homes that are professionally managed, often in desirable locations, making them attractive to tenants and helping investors secure reliable, consistent returns.
The key to success lies in location and quality. Investors can acquire units in established or emerging rental markets where demand for purpose-built rental homes is strong, setting the stage for long-term capital growth and robust income streams.
Rental income is a major advantage. BTR homes are modern, well-designed, and tenant-focused, with flexible leases that appeal to a wide range of renters. Investors can optimise yields through traditional lettings, multi-unit holdings, or other rental strategies, and high occupancy rates help ensure steady cash flow.
Finally, build-to-rent investment is hands-off and scalable. Professional management teams handle everything from tenant sourcing to ongoing maintenance, allowing investors to benefit from consistent returns with minimal effort, while providing opportunities to grow their portfolios efficiently.
Build-to-let investment: areas of consideration
Some important considerations for investing in build-to-rent include:
Capital requirements
Developing or investing in build-to-rent properties remains capital-intensive, which can limit access for smaller investors. However, the scale and long-term income potential often justify the upfront investment, and investors increasingly have access to pooled investment structures and partnerships that reduce individual capital outlay.
Longer investment horizon
Build-to-rent is a long-term strategy. Unlike flipping traditional properties, returns are realised steadily through rental income and long-term asset appreciation. For investors focused on stable cash flow and growth, this extended horizon is an advantage rather than a drawback.
Regulatory environment
Build-to-rent continues to thrive in a changing regulatory landscape. With the Renters’ Rights Act now in effect, reforms such as stronger tenant protections and updated tenancy rules are being phased in, and professional operators are well-positioned to adapt efficiently while maintaining long-term rental income and investment returns.
Management considerations
Professional management is a hallmark of BTR, though fees and operational oversight should be considered. Partnering with experienced management teams can turn this into a major advantage, ensuring properties are maintained, tenants are satisfied, and occupancy remains high.
Control and exit strategy
Investors typically have less hands-on control over individual units compared with traditional buy-to-let. Exiting an investment may require selling multiple units or the entire development, which can be more complex. However, the growing maturity of the sector and active secondary market make transactions increasingly feasible.
Financing complexity
Securing finance for BTR projects can be more complex than traditional property loans, given the scale and operational model. Yet lenders are now increasingly familiar with the sector, and innovative financing structures make it accessible to a wider range of investors.
Invest in build-to-rent: Reliable and resilient
Build-to-rent properties allow investors to invest in purpose-built rental homes designed for long-term tenancy, often in high-demand locations. These developments deliver modern, tenant-friendly homes, strong rental yields, and the potential for long-term capital growth, making them an increasingly attractive addition to any property portfolio.
Before investing, it’s essential to clarify your goals, understand your risk tolerance, and plan your exit strategy. Assess market trends, location demand, and projected growth to ensure your investment aligns with your objectives and maximises returns.
Even experienced investors benefit from expert guidance, which is why Alesco has been helping property investors navigate the build-to-rent sector for over 20 years. From identifying high-potential developments and conducting due diligence to managing contracts and streamlining acquisitions, we support you through every stage. Our goal is to make build-to-rent investment clear, manageable, and highly rewarding.
Get in touch today to explore off-plan properties for sale and discover how Alesco can help you make your next property investment a success.
Written by: Ben Whitaker
Experienced professional working in the real estate investments sector. Assisting and advising clients on the acquisition of property across a range of asset classes, with view to achieving robust return on investment.
