RMV, GRI, VTY: Real estate stocks to eye on as average house prices rise

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RMV, GRI, VTY: Real estate stocks to eye on as average house prices rise

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 RMV, GRI, VTY: Real estate stocks to eye on as average house prices rise
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Highlights

  • The average house prices in the UK rose by 9.8% in the 12 months to March 2022.
  • Data from the ONS showed that the prices climbed by £24,000 to £278,000.

Buying a house is now becoming a distant dream for many as average house prices in the UK increased by almost 10% over the last year to March 2022, according to the latest figures shared by the Office for National Statistics (ONS) on Wednesday. The average house price in March 2022 was £278,000, £24,000 higher than last year in the same period.

The growth rate in average house prices in March stood at 9.8%, which is lower than February's 11.3%, ONS said. Region-wise, the prices in England reached £298,000, 9.9% higher, while they were 11.7% up in Wales at £206,000. The average prices in Scotland climbed by 8% to £181,000 and by 10.4% in Northern Ireland to £165,000.

The lowest annual price growth was recorded in London. However, the average rates in the city remain the highest at £524,000.

Average house prices in the UK soared by £24,000 to reach £278,000 in the year to March 2022.

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Private rent up by 2.5%

Meanwhile, a separate report by the ONS said that private rental prices in the UK climbed by 2.7% in the year to April, up from 2.4% in the year to March. The rent paid by tenants rose by 2.5% in England, 2.9% in Scotland, and 1.7% in Wales in the 12 months to April. The highest growth in private rental prices was witnessed in the East Midlands region at 4.4%, while London saw the lowest at 1.1%.

Here is how FTSE-listed real estate stocks reacted to the news.

Rightmove Plc (LON: RMV)

Rightmove runs the UK's largest online real estate portal and is a constituent of the blue-chip FTSE 100 index. The company recently announced that its CEO Peter Brooks-Johnson has decided to step down.

Rightmove's shares were trading 1.40% lower at GBX 547.80 as of 8:33 am GMT+1 on 19 May 2022, with a market capitalisation of £4,667.04 million. The year-to-date or YTD return of the company currently stands at -31.14%, while share value has declined by 5.26% over the past one year.

Grainger Plc (LON: GRI)

The British residential property business is the country's largest listed real estate landlord. It is a constituent of the FTSE 250 index. For the six months to 31 March 2022, the company posted a 23% rise in net rental income of £42.8 million. Its adjusted earnings for the period also increased by 23% to £46.3 million.

Grainger holds a market cap of £2,215.03 million, and its one-year return stands at 2.67% as of 19 May 2022. Grainger’s shares traded at GBX 292.60, down by 2.08% at 8:54 am GMT+1 on Thursday.

Vistry Group Plc (LON: VTY)

The real estate developer operates across 13 business units, developing about 200 sites across England. It is a constituent of the FTSE 250 index. The group expects the profits in 2022 to be at the top end of market forecasts.

Shares of Vistry were trading at GBX 805.50, down by 3.24% at 8:55 am GMT+1 on 19 May 2022, with a market cap of £1,850.70 million. Over the past one year, its share value has depreciated by over 36%, while the YTD returns stand at -31.98%.

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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