Build to rent is purpose-built housing designed and retained for rent rather than sale. Schemes are typically professionally managed under single ownership and may include shared facilities and on-site services. National planning policy treats build to rent as a distinct part of the private rented sector, with a specific approach to affordable housing, long-term management and any future sale or change of tenure.

​

How is build to rent defined?

 

The National Planning Policy Framework defines build to rent as purpose-built housing that is typically 100% rented out.

​

A build-to-rent development may consist of flats or houses and can form part of a wider development containing other housing tenures. Where it forms part of a mixed-tenure development, the build-to-rent homes should be on the same site as, or next to, the main development.

​

Build-to-rent schemes are normally distinguished by:

​

• purpose-built homes intended for rent;

• professional management;

• single ownership and management control;

• market-rent and affordable homes managed together; and

• an intention to retain the homes in the rented sector for the long term.

 

Build to rent is therefore more than a conventional housing development whose individual homes happen to be let by their owners. Its ownership, management and operating model are usually integral to the planning proposal.

​

Is build to rent a separate planning use?

 

There is no separate build-to-rent use class. Build-to-rent homes will ordinarily fall within the same residential use class as other self-contained homes.

​

The planning distinction instead arises from the nature of the development and the obligations attached to the planning permission. These may control matters such as common management, the provision of affordable private rent homes, the period for which the development must remain in the rental sector and what happens if homes are subsequently sold.

​

Applicants should explain the proposed tenure and management model clearly. A development described as build to rent will usually need to demonstrate that its defining characteristics can be secured for an appropriate period.

​

How should local plans address build to rent?

 

Local planning authorities should assess the need for different types and tenures of housing, including homes for people who wish to rent.

​

Where evidence identifies a need for build-to-rent housing, the authority should set out how it will promote and accommodate this form of development. Local policies may identify the locations and circumstances in which it will be encouraged, such as:

​

• large housing sites;

• town-centre regeneration areas;

• highly accessible urban locations; or

• mixed-use developments capable of supporting a substantial rental community.

 

Whether a particular proposal is acceptable will still depend on the development plan and the usual planning considerations, including design, housing mix, amenity, transport, infrastructure and the effect on its surroundings.

​

What affordable housing must a build to rent scheme provide?

​

National policy expects affordable housing in a build-to-rent development to be provided by default as affordable private rent.

​

Affordable private rent homes are rented at a discount to equivalent market-rent homes within the scheme. They do not normally need to be owned or managed by a registered provider because they can remain under the same management as the market-rent homes.

​

National planning guidance identifies:

​

• 20% of the homes as a generally suitable benchmark for affordable private rent provision; and

• a minimum rent discount of 20% against local market rents, including service charges.

 

The discounted rent should be assessed against the market rent for the same or an equivalent property. The affordable homes should normally be maintained as affordable housing in perpetuity.

​

These figures are benchmarks rather than an inflexible national requirement. A local plan may set a different proportion where this is justified by evidence. An applicant may also make a viability case for a different contribution in exceptional circumstances.

​

Can the affordable housing offer be varied?

 

The proportion of affordable private rent homes and the depth of the rent discount can be varied across a development or over time.

​

For example, it may be possible to provide a larger number of homes at a smaller discount or fewer homes at a deeper discount, provided that the overall affordable housing contribution remains equivalent to that agreed through the planning permission.

​

Any arrangement should be agreed with the local planning authority and recorded in a section 106 agreement.

​

Other forms of affordable housing, or a financial contribution towards affordable housing, may sometimes be accepted. This requires agreement between the applicant and the local planning authority and should also be secured through the section 106 agreement.

​

How should affordable and market rent homes be managed?

 

Affordable private rent and market-rent homes should normally be managed together by the build-to-rent operator.

​

The affordable homes should be distributed throughout the development and be physically indistinguishable from the market-rent homes in quality and size. This allows the scheme to operate as one managed rental community rather than as separate affordable and market components.

​

The section 106 agreement will commonly address:

​

• the number and location of affordable homes;

• the applicable rent discounts;

• eligibility and income criteria;

• marketing and lettings arrangements;

• management and service standards;

• monitoring and annual reporting; and

• the replacement of an affordable unit where its designation changes.

 

Eligibility criteria should be agreed locally, having regard to household incomes and local rents. Although an authority may suggest potential tenants from an intermediate housing list, national guidance advises against giving the authority direct nomination rights.

​

What tenancy arrangements apply?

 

Since 1 May 2026, most private rented sector tenancies in England have become assured periodic tenancies under the Renters’ Rights Act 2025.

​

Build-to-rent operators can therefore no longer rely on conventional fixed-term assured shorthold tenancies for most private tenants. Rent increases must follow the section 13 process under the Housing Act 1988 and can generally occur only once a year, following the required notice.

​

The National Planning Policy Framework glossary still refers to build-to-rent schemes usually offering longer tenancy agreements of three years or more. In practice, this should now be read alongside the revised tenancy regime and the updated Planning Practice Guidance.

​

The 2026 reforms are also relevant to existing section 106 agreements. Where an agreement made before 1 May 2026 requires a tenancy type that has since been abolished, the legislation protects an operator from breaching that obligation merely by granting an assured periodic tenancy.

​

What happens if a tenant's income changes?

 

Eligibility for an affordable private rent home may be linked to an income threshold contained in the section 106 agreement.

​

An operator cannot evict a tenant simply because their income later exceeds that threshold. The agreement should instead allow the operator to remove the affordable designation from that home, adjust its rent through the statutory process and designate an equivalent vacant home as affordable private rent.

​

There may be a temporary period during which the scheme falls below its required affordable housing level while an equivalent home becomes available. The operator should notify the local planning authority and agree a reasonable approach to restoring the required provision.

​

This makes the drafting of eligibility and replacement provisions especially important.

​

What happens if build to rent homes are sold?

 

Build-to-rent developments are expected to remain under common ownership and within the rental sector for the long term. Planning obligations will frequently include a covenant requiring the market-rent homes to remain in that tenure for an agreed period.

​

The section 106 agreement should anticipate what happens if:

​

• the development is sold to another operator;

• individual homes are sold into owner occupation;

• the scheme is divided between multiple landlords; or

• affordable private rent homes are converted to another tenure.

 

A sale of the development as a whole does not necessarily conflict with the build-to-rent model if the new owner continues to operate it on the agreed basis.

​

The sale or conversion of individual homes is more likely to engage restrictions and compensation provisions. The agreement may require replacement affordable housing or a clawback payment reflecting the affordable housing benefit that would otherwise be lost.

​

These controls should protect the agreed community benefit without making it unnecessarily difficult for an operator to respond to changing market conditions.

​

Are different design standards applied?

 

There are no additional national design standards that apply solely because a development is build to rent. A scheme must comply with the relevant national and local planning policies in the same way as other housing development.

​

Local authorities are not required nationally to apply the nationally described space standard. Where an authority has adopted the standard, its policies will determine whether and how it applies to build-to-rent schemes.

​

Build-to-rent developments may include shared amenity spaces, workspaces, lounges, gyms or other communal facilities. These can form an important part of the overall housing offer, but they do not automatically justify inadequate private living space. The quality, usability and management of both private and shared spaces should be considered as part of the scheme as a whole.

​

What are the main planning considerations?

​

A successful build-to-rent application should align the physical design of the development with its long-term operating model.

​

Important considerations commonly include:

​

• evidence of demand for rental housing;

• the proposed housing and unit mix;

• the affordable private rent offer;

• design quality and residential amenity;

• the relationship between private and communal space;

• management, security and maintenance;

• rent and eligibility arrangements;

• the treatment of service charges;

• long-term ownership and tenure controls;

• monitoring and annual reporting; and

• appropriate provisions for a future sale or change of tenure.

 

The planning application, viability evidence and section 106 agreement should present a consistent proposition. Uncertainty about how the scheme will be owned, managed or retained can make it harder to establish that it genuinely qualifies for the policy approach applied to build to rent.

​

Key points

 

• Build to rent is purpose-built housing intended for long-term rental and professional management.

• It is a distinct housing model but not a separate planning use class.

• National guidance generally uses 20% affordable private rent as the benchmark, with rents discounted by at least 20%.

• Market-rent and affordable homes should normally be integrated and managed together.

• A section 106 agreement will usually secure affordable housing, management, monitoring, tenure retention and clawback provisions.

• Since 1 May 2026, assured periodic tenancies and the Renters’ Rights Act regime must be reflected in scheme management and legal agreements.

​

When should professional advice be sought?

 

Build-to-rent proposals require the planning strategy, affordable housing offer, viability position and operational model to be developed together. Site-specific advice can help establish how local policy applies, identify the appropriate affordable housing structure and ensure that the section 106 obligations provide sufficient certainty without unnecessarily restricting the scheme.

​

Updated 29 July 2026