Investors are targeting the Single-Family Housing (SFH) market as the booming sector aims to help fill the PRS shortfall.

A record 31 deals involving these build-to-rent schemes in suburban locations completed nationwide in 2024, up 24% year-on-year and more than double the level in 2022, reports property consultancy Knight Frank.

Its Single-Family Housing 2025 report explains how this “extraordinary growth” is evident in SFH’s share of total BTR deal volumes, which has surged from just 2% in 2020 to 43% in 2024.

SFH reaches £1.8billion

According to Knight Frank, investment in SFH reached £1.8billion last year, taking the total to more than £4.4billion invested since 2020.

The sector is now being developed in 132 local authorities and the current pipeline includes 14,353 SFH homes across 212 schemes, with a further 11,262 units being built.

In 2024, more than 3,000 SFH homes were completed.

The group believes the substantial surge in both investment and development during the last two years from a standing start demonstrates the pivotal role institutional investment in SFH can play in addressing the UK’s housing shortages.

Jack Hutchinson, partner in the residential investments team, said the size of the opportunity is immense.

“With 3.1 million renters already living in suburban households across the UK, and just 0.2% of current privately rented homes operated by institutional investors, we’re only scratching the surface.

“Our projections suggest the market could absorb more than one million SFH homes at full maturity. Given the size of the demand pool, we expect SFH delivery to eventually overtake multi-family as the market continues to evolve.”

Multi-family houses in the BTR sector are typically larger, apartment-style, city-based developments.

Oliver Knight, of Knight Frank, added: “SFH can help to replace some of these homes being lost from the rental market, though current rates of delivery aren’t making a dent.

“For investors and operators that has meant a period of above average rental growth, as well as strong occupancy and lease up in existing and new schemes.”

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