Regional cities with good transport links to London and Edinburgh have seen strong Build to Rent growth as tenants make “lifestyle and relocation moves” as a result of the pandemic, according to Savills.

Bristol and Glasgow, already home to well-established rental markets, saw rental growth of 6.7% and 6.5%, respectively since the first in a series of lockdowns began last March, says the estate agent.

Its third-quarter UK Build to Rent Market Update says: “A shorter commuting week allowed workers to prioritise locations that offered a better quality of life and afforded more space.

“An influx of urban workers with higher spending power pushed up rents in many markets.

“Now, with the return of students and a young, mobile workforce, city centre demand has returned and transport hubs are once again a priority.”

This shift has supported let up rates for BTR schemes.

The report says Bristol new-build rental projects have received “huge interest from London relocators”, while Grainger’s Gatehouse Apartments in Southampton has leased up eight months ahead of schedule and may have also benefited from the arrival from those moving from London.

The survey adds: “This places proximity to transport near the top of many tenant’s wish lists. Our latest third-quarter Savills agents survey shows that half of tenants now rank it as their number one priority.

“This should continue to be a key consideration for urban BTR investors. The report also points out that the recent return of students and young workers as the health crisis eases, means that city centre demand has recovered as rental growth returns.”

It says London and Edinburgh lead this move with growth of 3.4% in the three months to August – “the fastest rate of any core city”.

Nearly £420m was invested into UK BTR during the third quarter of this year, the survey says. Forward fund deals made up 64% of investment flowing into the sector which is in line with the three-year average.

The UK’s BTR stock now stands at 63,950 completed homes with a further 42,000 homes under construction.

The future pipeline currently stands at 99,500 homes, including those in the pre-application stage. This brings the total size of the sector to 205,500 homes completed or in development.

The report pointed to an August survey from the Royal Institution of Chartered Surveyors which said that the ongoing decline in landlord instructions resulted in a continuing imbalance between supply and demand, leading to a net balance of +64% of property professionals to predict that rents will go up over the next three months.

Savills adds: “This will support growth in short-term with stock levels remaining low across the UK.”