GRI, WJG, CRN: Stocks to eye as availability of rental homes come down

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GRI, WJG, CRN: Stocks to eye as availability of rental homes come down

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 GRI, WJG, CRN: Stocks to eye as availability of rental homes come down
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Highlights

  • A new survey has found that the number of properties available for rent has come down.
  • This comes as asking rents across the country are already at record-high levels.

While the average rents across the UK are seeing an unprecedented rise, the number of properties available for rent has come down, a new survey has found. The shortage of homes has also led to bidding wars, with tenants going to great lengths to secure a property.

According to the survey by industry body Propertymark, the availability of rental properties has halved from over 30 to just 15. The survey saw the participation of 440 letting agency businesses spread across 4,000 branches in the UK.

Last month, the Royal Institution of Chartered Surveyors had said that the number of homes available to rent was coming down as the demand from renters rose.

The number of homes available to rent is coming down as the demand rises.

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Additionally, as the supply for rental homes comes down, tenants are now shelling out more money and even providing their family bios to the owners to prove that they are desirable tenants, a BBC report claimed. Quoting a real estate agent, the report said that people regularly offer advance rents or more than the asking rent to get the property.

Rents at record levels

Meanwhile, asking rents across the UK have reached the highest-ever levels. Last month, property listing website Rightmove (LON: RMV) said the average monthly rent being advertised reached £1,088 in the first quarter of 2022, an 11% increase annually. In London, this increase was 14% as asking rents climbed to £2,195 per calendar month.

In the wake of this news, let us check out three FTSE-listed rental stocks and analyse their investment prospects.

Grainger Plc (LON: GRI)

Grainger is a residential property business that develops and operates residential housing in the UK. It has over 9,000 homes under its portfolio. In the six months to 31 March 2022, the company reported a 23% increase in net rental income over the previous six months.

With a market cap of £2,318.81 million, shares of the FTSE 250 constituent closed at GBX 303.20 on 6 June 2022. The share value has appreciated by 6.23% over the last one year, and the year-to-date (YTD) returns stand at -1.52%

Watkin Jones (LON: WJG)

The UK-based company is engaged in the business of property development and management. It operates through four segments, including student accommodation, build to rent, residential and accommodation management.

The company holds a market capitalisation of £585.33 million at present, and its shares have given a return of 5.30% to the investors over the past one year. On a YTD basis, the returns stand at -12.62%. The shares closed at GBX 228.50 on 6 June 2022.

Cairn Homes Plc (LON: CRN)

The Irish company develops, sells, and rents residential properties. It currently has a market cap of £652.69 million, and its share price has depreciated by 2.21% over the past one year as of 6 June 2022. The YTD returns currently stand at -2.52%.

Shares of the company closed at GBX 92.80 on Monday.

Note: The above content constitutes a very preliminary observation or view based on market trends and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.

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