Research prepared by Savills has shown there were 2,176 fewer starts from the year before during this period.

This decline was seen most acutely outside London, with an 84% drop registered in the regions.

On schemes currently under construction, nationally the number of homes fell by 21% in Q2 2026 compared to Q2 2025, with London experiencing a more substantial drop (27%) than the regions (19%).

This is continuing the trend of pipeline exhaustion, whereby completions exceed new starts-on-site and schemes coming through the planning system, despite an uplift in the number of schemes being approved. This can be seen by the fact that for the tenth consecutive quarter, annual completions have exceeded starts.

In response, Real Estate:UK argues that the government needs to avoid creating future additional uncertainty, or making abrupt and unwelcome shifts in policy, to prevent viability pressures worsening and investment into new schemes being chilled.

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“The Q2 2026 delivery figures have shown one of the sharpest declines in the number of new start-on-sites yet, and undoubtedly reflect the impact the viability crisis is having on the development of BTR schemes across the UK,” said Danny Pinder, director at Real Estate:UK.

“That the sharpest decline in starts is within the regions is yet further evidence of the fact that, in most parts of the country, it is now unviable to bring forward new schemes despite strong underlaying tenant demand.

“In addition to viability, we’ve also had increased regulatory uncertainty, through speculation around rent controls and other potential property taxation changes continuing to impact on investment considerations.”

Jacqui Daly, director at Savills Residential Research, added: “BTR has become an increasingly important source of housing supply, with the potential to unlock new development by enabling housebuilders to open sites with investors underwriting delivery.

“As demand for rental homes continues to grow, it is important that the sector can continue bringing forward new schemes across the UK.”