Some 23% of build to rent investors are considering whether to put plans for acquisitions on hold, following economic uncertainty in the wake of the pandemic.
The remaining 77% of investors say they will make no changes to their investment plans, according to Knight Frank. The agent also noted that some are looking to increase their activity.
The agent surveyed top institutional landlords responsible for around 22,000 rental homes across the UK. It found that despite collecting an average 95.2% of rents between March and June, many investors remain cautious.
Knight Frank has predicted zero rental growth for the year and a rise of 2% in 2021. It said the muted increases reflect lower inflation and higher employment levels following the outbreak of Covid-19.
James Mannix, head of residential development at Knight Frank, said: “Our view remains that long term, the current crisis may well act as a catalyst for an acceleration of institutional capital into the UK’s residential investment sector.
“Through the lockdown we have seen an increase in the number of new entrants seeking to increase their exposure in the UK market.”
During Q2 the sector slumped to its lowest level on record, with just £83m committed in two transactions from Aberdeen Standard Investments, according to CBRE.
However, Q3 has already exceeded this level, with deals including a debut investment from Pension Insurance Corporation of around £120m at Manchester’s New Victoria (pictured) and a further £41m from ASI at Clarendon Quarter in Leeds.