Retailer John Lewis is closing down its rental property division – throwing the whole Build To Rent sector into crisis.
In 2022 John Lewis announced a £500m multi-decade joint venture with global investment company Abrdn to deliver around 1,000 new Build To Rent homes across three locations.
And as recently as last October – just five months ago – it was given the go ahead for a £70m scheme to regenerate an underused brownfield site in Reading.
But a report overnight on the BBC says the John Lewis Partnership is instead focusing on its retail brands, John Lewis and Waitrose, to simplify its business and strengthen its balance sheet.
It’s blaming construction inflation for its withdrawal.
A statement says: “Our rental property ambition was based on a very different financial environment: one with more stable investment returns, lower borrowing costs, and more affordable costs to build homes.”
Meanwhile the biggest property organisation supporting Build To Rent admits the sector has stalled.
And it wants a huge tax concession next week to resuscitate the concept.
The British Property Federation (BPF) has called on Chancellor Rachel Reeves to reinstate Multiple Dwellings Relief (MDR), a fiscal policy scrapped in 2024.
The BPF claims the abolition of MDR – a bulk purchase tax relief in the Stamp Duty Land Tax system in England and Northern Ireland – directly stalled or hampered the delivery of up to 25,000 BTR homes by allegedly making them unviable.
The BPF also claims that the cost to the Treasury of these unbuilt homes – from a combination of lost Stamp Duty Land Tax and economic activity associated with construction – outweighs the total saving made from abolishing the relief.
BPF estimates that introducing a more targeted MDR relief for the BTR sector would cost £155m.
And it claims that if this helped to unlock 25,000 stalled homes, the economic activity would generate wider tax revenues of £650m.
In 2025 only 613 new BTR homes starting construction in London – an 80% drop compared with 2024.
Out of London construction fell by 37% from 12,781 to 8,063 according to the BPF and Savills.
BPF chief executive Melanie Leech says:“The tax system is undermining the viability of much needed new homes in London and across the country.
“We urge the Chancellor to act now rather than delay to the Autumn, when the housing delivery numbers will be as stark for 2026 as they have been for 2025.”
This article is taken from Landlord Today