The supply of one-bedroom flats has surged, with 20% more listings than five years ago and 42% more than a decade ago, according to Rightmove. Yet they take longer to sell, averaging 70 days on the market—a week longer than five years ago and 24 days longer than a decade ago. Additionally, 36% of one-bed flats listed have undergone at least one price reduction, indicating oversupply.
Build-to-rent construction is plummeting. According to the British Property Federation (BPF) and Savills, the number of build-to-rent homes under construction has fallen for the ninth consecutive quarter, with 59,874 homes under construction in Q1 2025, falling 17% year-on-year by Q1 2026. London build-to-rent starts fell 67% to 1,048. The average wait for planning consent for a build-to-rent home in London has lengthened from 8 to 15 months in the last six years, according to the British Property Federation.
Major housebuilders are pulling back. Barratt Redrow said it is trimming its land purchases from 10,000-12,000 plots to 7,000-9,000, citing the Iran war creating uncertainty. Berkeley Group announced an outright halt to buying new land a couple of weeks ago, according to the company. Net additional dwellings in 2024-25 were 208,600, down 6% on the previous year, according to government data.
SME housebuilders are in crisis. According to a Savills report for the Land, Planning and Development Federation (LPDF), SME house builders have seen average sales drop by 41% between 2021 and 2025. Builders delivering 500-1,000 homes per year have seen average sales per outlet fall from 33 homes per year in 2021 to 19 in 2024. The LPDF reported that SME house builders delivered 40% of UK new homes in 1988 but their completion rate has dropped by 38% among those outside the top 50. According to the Home Builders Federation (HBF), 70% of SME building firms said current market conditions reduce their appetite for starting new sites, and a quarter expect to cut back on land purchasing. Only 28% of SMEs have a positive outlook on the UK housing market. Among the smallest firms (building less than 75 homes a year), 28% expect housebuilding to decline in the next three months, and 18% brace for a drastic reduction in housing starts. In London, 57% of SME developers expect worsening conditions, according to the HBF.
New homes rarely reach the open market. According to Alto and the ONS, only one in 10 newly built homes in the UK reach the open sales market. Of an estimated 200,000 new properties in England in 2024/25, just 21,261 reached the open market. In London, only 2% of new builds reach the open market.
London's housing delivery is far below targets. According to Molior consultancy, London is expected to deliver 88,000 new homes every year but only 4,550 per year are predicted for 2027 and 2028. The landfill tax is set to increase by 500% over the Parliament, according to the HBF, adding further cost pressure.
Public sentiment is bleak. A OnePoll survey for Alto of 2,000 adults found that 44% feel there aren't enough properties on the market to buy, and 46% believe new builds in their area are targeted at investors and landlords rather than local buyers. 36% are convinced they will never own their own home. 60% cite the market being too costly as a factor preventing home ownership, and 58% cite not earning a sufficient wage. 15% said they actually prefer renting. 57% believe it is the government's duty to ensure adequate homes are available, and 46% indicated there could be greater support for first-time buyers. 27% believed there was a need for stronger regulation of rental prices. 61% said property investors and landlords are squeezing out first-time buyers, and 48% would back stricter restrictions on investors purchasing new properties.