Build-to-rent completions up in Scotland but units under construction drop 15% in a year

A real estate industry body has warned of “pipeline exhaustion” in the Scottish build to rent sector, as the number of units under development 15% in a year despite a significant rise in completions.

Analysis by the Scottish Property Federation (SPF) and Savills put the number of homes under construction in the second quarter of this year at 2,101, down from 2,472 in the same period last year.

This despite a 16% increase of new developments being finished in the quarter, compared with Q2 2024.

The SPF claims that proposals around rent controls, currently going through the Scottish parliament, have had a negative impact on investor sentiment.

The Housing (Scotland) Bill, which was introduced to parliament on 26 March, would among other things create a power for Scottish ministers to introduce rental control areas.

It is currently at stage three in the Scottish parliament, the final point at which MSPs can make changes to the bill.

Property owners have criticised the bill, but it has received support among organisations such as Living Rent, which represents tenants in Scotland.

In its submission to a consultation on the bill, the SPF suggested that the build-to-rent sector be given a blanket exemption from rent controls. 

>> Read more: A distinct culture but familiar dilemmas: Spotlight on Scotland’s housing sector

David Melhuish, director Scottish Property Federation, said: “The continued decline in the number of BtR schemes starting on site, reflect that persistent policy uncertainty, especially around rent controls, continues to have a damaging impact upon investor confidence in Scottish BtR.  

“On this trajectory Scotland will soon exhaust the pipeline of new BtR developments, as completions continue to exceed commencements. 

“To restore investor confidence and to kick start new supply of rental homes, we are calling as part of our response to the Scottish Government’s recent Housing consultation, for Built to Rent/Mid- Market rent to be granted an exemption from rent controls across Scotland.”