UKREiiF 2026 recap: Where the smart money is moving for Living 2026

At UKREiiF 2026, Womble Bond Dickinson convened a panel of leading voices from across the Living sector to explore one of the most pressing questions facing the market today: where is the smart money moving?

Featuring Lesley Davison (Delancey), Jon Di-Stefano (Greencore Homes), Chiara Caldwell (Close Brothers) and Hayley Holness (Legal & General), the discussion offered a candid assessment of current market dynamics, funding realities and where opportunity lies across the Living landscape.

A market defined by affordability and flexibility

A clear theme throughout the discussion was the growing importance of affordability; both in its traditional sense and in a broader, more nuanced form. Beyond traditional affordable housing, there is increasing focus on “affordable with a small ‘a’”: homes that are simply cheaper to live in. This includes energy-efficient properties, retrofit-led improvements and schemes with fewer amenities that reduce both upfront and ongoing costs.

In a challenging viability environment, anything that lowers cost is becoming critical. The market is responding with more pragmatic, flexible approaches to delivery, reflecting a shift towards needs-based product design rather than a one-size-fits-all model.

Growth opportunities depend on timing

When it comes to growth, timing and investment horizon are key. Long-term capital continues to back sectors such as purpose-built student accommodation and later living, where investors are prepared to ride out market cycles. At the same time, repricing across the market has created renewed interest in acquiring existing build-to-rent stock, where yield adjustments are presenting new opportunities.

For developers, the strategy is increasingly dual-track: taking a long-term view on land while prioritising affordable housing in the short term to support viability and access grant funding. While the near-term outlook remains uncertain, there is confidence that opportunities will continue to emerge for those able to navigate the cycle.

Capital flows are shifting

The panel highlighted a clear shift in how schemes are being funded. Debt remains available, with strong competition among lenders and improving margins. The greater challenge is equity, which has become harder to secure. As a result, there is growing reliance on private wealth, high-net-worth investors and private equity to fill the gap. At the same time, some overseas capital has pulled back following recent yield shifts and regulatory changes, although domestic institutional capital, including pension funds, continues to play an important role. The consensus was that this is not a debt-constrained market, but an equity-constrained one; with affordability pressures and mortgage access further limiting end-user demand.

Partnerships and tenure diversity are increasing

Partnerships are now central to delivery. Collaboration between developers, funders and housing providers is helping to unlock sites and improve viability, particularly as schemes become more complex. Alongside this, there is greater emphasis on tenure diversity, with mixed-tenure models increasingly seen as essential to making projects stack. This shift is also driving product evolution. Simpler, lower-cost schemes are becoming more prevalent, but there remains a place for premium, well-designed developments that are carefully targeted to the right audience.

Supply-side constraints continue to hold back delivery

Despite signs of opportunity, supply-side barriers remain a significant challenge. Planning delays, legislative complexity and lack of certainty around timelines were identified as ongoing issues impacting viability. While national policy changes, including green belt reform, have been positive, progress at a local level has been slower, limiting the pace at which new supply can be brought forward. The panel called for more targeted intervention to support delivery, including increased grant funding, infrastructure investment and greater clarity in the planning process.

Rental markets reflect diverging strategies

In the rental sector, a clear distinction is emerging between short-term and long-term investment strategies. Short-term capital is more sensitive to pricing and returns, while long-term, patient capital is better positioned to absorb market fluctuations and focus on sustained rental growth. This divergence is influencing both pricing and performance across rental assets.

Sustainable finance: a secondary driver

While sustainability remains high on the agenda, its role in funding decisions is still evolving.

Green finance products are not yet seen as sufficient to offset the additional costs associated with sustainable development. Instead, ESG considerations are often embedded within broader development strategies, with innovation largely driven by developers themselves – particularly smaller, more agile operators.

So, where is the smart money going?

The discussion highlighted several consistent areas of focus:

• Affordable housing, in both traditional and more flexible forms
• Existing build-to-rent stock, reflecting repriced yields
• Single-family housing and suburban opportunities, including grey belt land
• Emerging tenures such as co-living

Ultimately, there is no single destination for smart capital in 2026. Success will depend on adaptability, partnerships and a clear understanding of evolving demand. In a market shaped by affordability pressures, constrained equity and ongoing supply challenges, those able to remain flexible across product, funding and delivery will be best placed to capture the opportunities ahead.