Grainger, one of the leading residential landlords in the UK, has witnessed a surge in rents and is predicting further growth in the coming year as demand continues to remain strong. The company, which owns approximately 12,000 homes, reported a like-for-like rental growth of 6.3% for the year ending in September.
Although this figure is a decrease from the 7.7% growth recorded the previous year, Grainger highlighted that the rental market in the UK has been bolstered by a rapid increase in demand while the supply remains limited. The company anticipates that rental growth may ease in 2024-25 but will still benefit from high wage growth.
Helen Gordon, the chief executive of Grainger, expressed optimism regarding future rental growth, stating, “Whilst we expect rental growth to ameliorate somewhat, we still expect levels to be above the long term historic average for 2024-25.” Gordon also pointed out that rental growth will be supported by sustained high wage growth, especially in the demographics and locations targeted by the company.
Moreover, Grainger applauded the Labour government’s decision not to implement rent controls. Gordon welcomed the government’s plans to reform the planning system to stimulate housing supply and enhance rental market standards, aligning with Grainger’s strategic goals and existing standards.
As of the end of last month, Grainger confirmed that its properties were fully occupied, with an occupancy rate of 97.4%, a slight decrease from the previous year’s 98.6%. The company reported comparable rental growth of new lets in its portfolio at 5.6% over the past year, with renewed lets showing a growth of 6.8%.
In the same year, Grainger added 1,113 new homes to its portfolio. The company is scheduled to announce its full-year financial results on November 21.