Property group Grainger says continued demand for private rented homes and associated rental growth puts it in a strong position.
The Newcastle-based plc gave an update on trading in the four months to the end of January and said like-for-like rental growth was 6.1% as most of its portfolio of 10,000 homes was occupied. Ahead of its annual general meeting, the firm told investors that it was closely monitoring affordability levels for its customers but expected its market to remain resilient.
Grainger has pipeline of a further 7,000 build-to-rent homes, of which it hopes to deliver 1,640 in the 2023. This year is planned to be a record year of investment for the developer, with around £300m committed to projects.
Read more: Gateshead's Traidcraft falls into administration amid range of pressures
A build-to-rent partnership with Transport for London was said to be progressing with arrangement of land for four schemes in north, west and south London representing about 1,240 homes with planning consent.
Helen Gordon, chief executive of Grainger, said: "Building on last year’s record performance, Grainger has continued to deliver strong performance against all key operational metrics as demand for private rented housing in the UK has continued to grow further, coupled with low levels of supply. We have delivered a strong operational performance during the first four months of our financial year since October 1, 2022.
"Whilst keeping a very close eye on overall customer affordability levels, like-for-like rental growth has accelerated to 6.1% (PRS: 6.1%; Regulated tenancies: 6.2%) from 5.5% in H2 2022, closely correlated to wage inflation, compared to 3.2% for the same period last year. Our PRS portfolio is effectively fully occupied at 98.7% (February 2022: 97%).
"Our programme of sales activity has proved resilient to date despite the uncertain outlook in the housing sales market, due to a lower reliance on mortgage purchases and first-time buyers. Sales of vacant homes from our regulated tenancy portfolio, as well as asset recycling across our PRS, regulated tenancy and development portfolios, have performed well, generating £48.1m of total proceeds, ahead of the same period last year (£21.1m proceeds). Sales prices achieved from vacant sales were on average 1.2% below September vacant possession values, outperforming the market and reflecting the more resilient nature of these sales due to our typical buyer profile."
Go HERE to sign up for North East business newsletters and get all the latest news direct to your inbox
READ NEXT:
North East prepares to fly the regional flag at world's biggest property conference Mipim 2023
- Nissan executive warns on future work for Sunderland plant amid rising costs for businesses in UK
North East universities put more than £2bn into region's economy
Legal & General's Sir Nigel Wilson: "We need more people to step up and invest in the UK"
- Read more North East business news
