Rental housing

Demand for rental housing remained strong in growth centres. Differences between regions are increasing and, in some regions, supply and demand are now in balance. As in previous years, the strongest demand focused on smaller apartments, that is, studios and one-bedroom apartments.

The rental occupancy rate remained at a good level, standing at 96.9 (97.4) per cent for the review period. At the end of the review period, 255 (568) apartments were vacant due to renovations. The tenant turnover rate, which includes internal transfers, increased slightly when compared to the corresponding period of the financial year 2015 and was 15.6 (13.7) per cent.

The average rent for the Group’s 28,505 (26,745) market-based rental apartments (Lumo) was 14.30 (13.69) per sq m per month during the review period, and EUR 14.44 (13.87) at period end. The average rent of Lumo apartments is increased by new development related to strong investment activity in growth centres. The corresponding figures for the 4,231 (13,929) apartments rented at cost price (VVO) was EUR 12.80 (12.68) during the review period and EUR 12.93 (12.78) at period end.

At the end of the review period, there were 12,976 (16,199) active applications. (Applications are active for three months.) The average number of active applications per rental agreement termination was 15.9 (18.6). A total of 25,315 (30,868) new rental housing applications were received during the review period. The change in the number of applications is related to the rapidly growing Lumo Homenow service in which customers can rent the apartment they want directly online without submitting an application.

The average period of tenancy remained at an excellent level, 6.0 (5.9) years. Thanks to successful rental control and our housing advisory service, the proportion of annual turnover from rental operations accounted for by rent receivables remained low and stood at 1.1 (1.2) per cent at the end of the review period.

Lumo Kompakti is a new housing concept that was published during the review period. It has been designed for the needs of urbanising Finland, especially the Helsinki Metropolitan Area. In terms of overall rent, Lumo Kompakti is a more affordable option than what is generally available on the market. Lumo Kompakti, developed in cooperation with Fira Oy, is a good housing option for those who appreciate efficient multi-use space and convenient connections to work, hobbies and services. Lumo Kompakti has also been developed through crowdsourcing among young people. Currently, we are looking for suitable plots for the concept.

The Group’s regional tenant events were held in Lahti, Lappeenranta, Jyväskylä, Kuopio, Oulu, Rovaniemi and Turku, where the event also welcomed guests from Pori and Rauma. The topics discussed included the housing of the future and environmental and energy issues. The events attracted some 550 guests.