Rental housing

Demand for rental housing remained high in all municipalities where VVO Group has a presence. As in previous years, the strongest demand focused on smaller apartments, that is, studios and one-bedroom apartments.

The rental occupancy rate remained good, standing at 97.6 (98.1) per cent for the financial year. At the end of the year, 334 (451) apartments were vacant due to renovations.

Tenant turnover, including internal turnover, increased slightly and was 27.2 (25.8) per cent.

The total increase of rental income was in the financial year was 4.1 (3.9) per cent. The increase in rental income was influenced by the rent adjustment, 3.5 (3.5) per cent on average, implemented in March 2015, as well as the change in the housing stock.

With regard to the housing stock as a whole, the average rent during the year was EUR 13.45 (12.91) per sq m per month. At the end of the financial year, the average rent was EUR 13.66 (13.04). The average rent for the Group’s 28,167 (26,841) rental apartments subject to market-based determination of rent (the Lumo brand) was EUR 13.72 (13.17) during the period and EUR 13.99 (13.33) at the end of the financial year. The corresponding figure for the 12,968 (13,952) cost principle, state-subsidised rental apartments of the VVO brand was EUR 12.87 (12.42) during the period and EUR 12.93 (12.49) at the end of the financial year.

The average duration of tenancy remained high, at 5.9 (5.9) years. At the end of the financial year, there were 14,456 (15,785) active applications. (Applications are active for three months.) The average number of active applications per rental agreement termination was 18.6 (22.9). A total of 61,201 (67,528) new housing applications were received during the financial year. The deployment of the Lumo Kotinyt.fi service was one of the factors contributing to the number of applications.

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 0.9 (1.2) per cent at the end of the review period. During the financial year, VVO Group’s housing ad-visory service was expanded to the entire country.
VVO Group launched an online apartment rental service at www.lumo.fi/kotinyt during the period. The Kotinyt.fi service is a new method for renting an apartment without waiting: the customer chooses a suitable Lumo rental apartment, pays the rent for the first month and can move in on the next weekday, for instance. The new service was an immediate success.

In Helsinki, Espoo, Tampere, Jyväskylä, and Turku, we introduced car sharing co-operation with 24Rent. The car-share vehicle can be reserved by the residents of the respective Lumo property and picked up from the building’s own designated car park.

The agreements signed with DNA and Elisa on faster broadband connections entered into force on 1 January 2015: a 10-megabit broadband connection that is included in the rent is now available in nearly all of the Group’s apartments.
The results of the annual client satisfaction survey were finalised during the period and, according to them, tenant satisfaction has remained high: nearly 90 per cent of them have recommended or ready to recommend VVO Group as a landlord. In 2015, the net promoter score (NPS) was 38 (New tenant survey).

The Building of the Year 2015 was Koulukatu 1 in Lappeenranta, announced at VVO Group’s annual Housing Day event.