The answer might not be what you think. In certain industries, short-term pressure might create long-term opportunities. 

Who are the obvious casualties?

The stock market is already anticipating a Burnham era. And the Makerfield MP’s time as Greater Manchester mayor gives them some ideas.

The obvious casualties are likely to be infrastructure names. Transport operators and utilities companies — such as Pennon and SSE should be on notice. 

Burnham had success with similar regional policies in Manchester, where buses have been brought under local control. So investors naturally expect something similar on a larger scale. 

The more interesting story, however, might not be in infrastructure. I think it might be in housing.

A landlord’s nightmare – or is it?

Burnham openly supports rent controls. That’s on top of the Renters’ Rights Act, which came in earlier this year.

Again, a look at Manchester is instructive. Greater Manchester reported a 43% rise in financial penalties against landlords, totalling £1.47m.

Burnham also backed compulsory purchase powers for properties falling below standards. All of this sounds like a landlord’s nightmare. 

To some extent, it is. But the effects of a tougher environment are unlikely to be felt evenly across the industry.

Don’t waste a good crisis

When the going gets tough, it’s the marginal operator who gets going. Higher compliance costs affect the weakest names the most.

By contrast, the strongest get stronger by comparison. The landlords who leave the industry are mostly the more financially stretched ones. 

Those staying tend to be more professional and better capitalised. And amateur buy-to-let investors selling up reduces the competition for the ones left standing.

Demand for rented homes isn’t going away. So a company in a strong position in this industry might well be worth a look.

Size matters

Grainger (LSE:GRI) is the UK’s largest listed provider of private rental homes. It has a portfolio of 11,100 homes and around 5,000 more on the way.

In 2025, net rental income grew 12% to £123.6m, earnings increased by 12%, and occupancy levels were around 98.1%. That’s all pretty good – and there’s more.

Customer affordability sits at 28% of income. This suggests a low risk of defaults and scope for future increases.

Converting to a real estate investment trust (REIT) is set to save around £15m in taxes. That’s all very positive, so what’s the concern?

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

What are the risks?

Regulation is a genuine risk for Grainger and it’s too close to ignore. Realistically, it comes in two forms – tighter standards and rent controls.

On the first issue, 96% of the firm’s portfolio has an EPC rating of C or above. That gives it a head start on standards tightening in the future.

In the case of rent controls, there’s not much the firm can do. But I do think this would help Grainger’s competitive position. 

The company’s platform manages a growing portfolio at a marginal cost that smaller operators simply can’t replicate. And that’s a huge advantage.

The bottom line

The analyst consensus target for Grainger is 220p. The current share price is around 33% lower.

Short-term political pressure can create long-term buying opportunities in the stock market. I think this is one to keep an eye on.

Should you invest £5,000 in Grainger Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Grainger Plc made the list?

Stephen Wright does not own shares in any of the companies mentioned.

The post Which UK stocks have the most to lose (or gain) in an Andy Burnham government? appeared first on The Twelfth Magpie.

Today, the FTSE 350 index of large- and mid-cap shares still trades at a 30-year discount to the S&P 500 index of US stocks.

So which UK companies have grabbed my attention? Three in particular stand out to me. These are:

• Grainger (LSE:GRI)
• Rathbones Group (LSE:RAT)
• Hollywood Bowl (LSE:BOWL)

Here’s why I think they’re top value shares to consider.

A cut-price REIT

With a price-to-earnings (P/E) ratio of 9.4 times, Grainger’s cheap share price doesn’t reflect the stability of the residential rentals market, in my view, nor the long-term earnings opportunity it enjoys.

It’s true that rising inflation has raised the risks the FTSE 250 company faces. If interest rates rise, its cost of borrowing could rise sharply. But I’m still expecting earnings to rise as the UK’s chronic housing shortage drives rental growth.

Grainger’s like-for-like rents rose 3.1% during October-March. Occupancy also remained high at 96%, underlining the durable nature of the rentals market.

One final thing: Grainger’s dividend yield has shot up to an impressive 5.3%. Under real estate investment trust (REIT) rules, the firm must pay 90% of its rental profits out to shareholders.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Growth and dividends

Rathbones shares also look dirt-cheap based on expected earnings and dividends. Its P/E-to-growth (PEG) ratio comes in at just 0.4. A reminder that any sub-1 figure suggests a stock that’s trading below value.

Meanwhile, the asset manager’s dividend yield is 5.4%. Like Grainger, that’s roughly 2% better than the FTSE 250 average.

So what else makes Rathbones a top bargain to consider? Rising competition in the financial services space is a clear risk. But the company’s excellent reputation means it is (at least for now) continuing to thrive in what remains a fast-growing sector.

Rathbones notes that “a projected £5.5trn in intergenerational wealth transfer over the next 25 years, combined with an ageing population and rising financial complexity, continues to drive long-term demand for professional advice“. Its 2024 acquisition of Investec Wealth & Investment gives it added scope to seize this opportunity.

Bowled over?

Hollywood Bowl’s shares surged after late May’s latest trading update (more on this later). But the 10-pin bowling operator still looks cheap based on predicted earnings, with a PEG ratio of just 0.9.

Like many other UK leisure shares, its revenues are highly sensitive to the the broader economic landscape. Things could become more challenging as inflation rises. But trading remains rock-solid so far, with sales and adjusted pre-tax profit up 9.5% and 8.1% during October-March.

The question is, can it keep up the pace? I’m confident it can, supported by rapid expansion in Canada, along with investment in areas like amusements to encourage bowlers to spend more.

One last big perk for value chasers: Hollywood Bowl’s dividend yield is a tasty 4.7%.

Should you invest £5,000 in Hollywood Bowl Group Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Hollywood Bowl Group Plc made the list?

Royston Wild does not hold any positions in the companies mentioned.

The post How are these FTSE 250 growth and dividend stocks so cheap? appeared first on The Twelfth Magpie.

According to the latest official data, the average Cash ISA balance is £26,900. And I can’t help but think that this could do better elsewhere.

Cash returns

The best Cash ISA that I can find right now comes with a 4.51% interest rate. That’s enough to make a £26,900 account generate £1,213 a year.

That’s actually not bad, especially with the tax protection that comes with an ISA. But there is one big thing to pay attention to.

Inflation can weigh on returns. According to the latest data, real returns from Cash ISAs have been negative in six of the last seven years.

Given this, I think it’s worth seriously considering other opportunities. And the stock market has plenty of income-generating investments.

Stocks and Shares ISAs

A Stocks and Shares ISA comes with similar tax advantages to a Cash ISA. Returns – whether capital gains or dividends – are tax-free.

That means investors can keep 100% of their returns. And I think there are opportunities to earn more than 4.51% a year.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Grainger (LSE:GRI) shares come with a 5.49% dividend yield. In the context of a £26,900 portfolio, this amounts to a £1,476 a year second income.

The difference between £1,213 from cash and £1,476 from stocks might not seem like a lot. But that’s just the beginning.

What about inflation?

Grainger is in the property business. Specifically, it owns residential properties that it leases to tenants up and down the UK.

As most of us know, UK rents have tended to rise over the last 10 years. More importantly, they also tend to stay well ahead of inflation.

Source: Trading Economics

Grainger isn’t entirely resistant to rising costs. But I think it’s in a better position than a Cash ISA when it comes to cash losing its value.

So the choice is between a 5.49% dividend yield with some inflation protection or a 4.51% interest rate. But what about the extra risks?

What are the risks?

I think the stock market is a great place to invest for a second income. But – much as I’d like it to think otherwise – there are always risks.

With Grainger, the biggest danger is something threatening those consistent rent increases. And that’s impossible to rule out.

There are some political noises about rent controls in the UK. While they aren’t from major parties – yet – they are gathering momentum.

That’s a risk for the firm. But I see it as a threat to monitor rather than one to worry about, at least for the time being. 

Saving vs. investing

There are times when people need cash. Grainger shares aren’t a currency people can use to pay for emergency costs. 

When it comes to earning a second income, though, things are different. Inflation has been a huge issue for cash savings. 

This is something investors need to think about. And Grainger’s dividend yield and cost advantages make it a good candidate to consider.

Stephen Wright has no position in any of the shares mentioned. The Twelfth Magpie has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor and Hidden Winners. Here at The Twelfth Magpie, we believe that considering a diverse range of insights makes us better investors.

The post Here’s how to turn £26,900 into an instant £1,476 a year second income appeared first on The Twelfth Magpie.

Take Grainger (LSE:GRI) and Unite Group (LSE:UTG). These two dividend shares carry ultra-low valuations, yet have brilliant records of delivering passive income.

So why are they trading so cheap? And why should investors consider buying them today?

Dividend hero

Grainger is a dividend machine. It’s grown dividends in nine of the last 10 years. For 2026, its dividend yield is 5.6%, smashing the FTSE 100 average of 3.1%.

So why are its shares trading so cheaply? It comes down to interest rate expectations as inflation rises. Borrowing costs could leap, hitting earnings and impacting its growth strategy. Property valuations will also be hit if the Bank of England raises rates.

But in my view, Grainger shares are too cheap. It trades on a forward price-to-earnings (P/E) ratio of 7.8 times. Meanwhile, its price-to-book (P/B) sits at 0.6 — at below 1, the stock trades at a discount to the value of its balance sheet assets.

What I need to know is whether this real estate investment trust (REIT) can still be a reliable source of dividends. I think it can, thanks to its focus on the defensive residential property market.

It’s not just that demand for houses remains unaffected by economic conditions. Its that there’s a chronic shortage of quality rental properties in the UK. And with the national population also soaring, I’m confident rental income — and with it Grainger’s earnings and dividends — should keep rising strongly. Like-for-like rents increased 3.1% in the four months to January.

I expect Grainger’s share price to recover strongly over time. Meanwhile, it should keep delivering juicy dividends thanks to sector rules. REITs like this must pay at least 90% of yearly rental profits out to shareholders.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

A 7.8% opportunity?

Unite is another REIT with a long record of dividend growth. Again, it has had nine annual increases in the past 10 years. Its dividend yield for this year is an even-more impressive 7.9%.

So what’s the story here? Like Grainger, it’s slumped due to concerns over future interest rates. But that’s not all. This dividend stock provides university accommodation, so has suffered as more students have chosen to live at home to save money.

Unite’s share price drop now leaves it on a forward P/E ratio of 8.1 times. It represents a great dip buying opportunity for investors to consider.

Why? The long-term outlook for the student accommodation market remains as robust as ever. The UK remains a hugely popular hub for international students, and Unite’s focus on the most popular locations and respected universities sets it up well for long-term growth. Think towns and cities like London, Bristol, Nottingham, and Manchester.

One final thing: Unite has a robust development pipeline too to capitalise on this opportunity. This should create a whopping 10,000 beds for delivery over the next five years

The post How can these top passive income stocks be trading at bargain prices? appeared first on The Twelfth Magpie.

So which bargain stocks have grabbed my attention today? Grainger (LSE:GRI) and Ibstock (LSE:IBST) have both caught my eye, as each carries one or more of a low:

• Price-to-earnings (P/E) ratio
• Price-to-earnings growth (PEG) ratio
• Price-to-book (P/B) ratio

As a keen income investor, I’ve also considered the dividend yields of each company. And one of these top stocks carries a yield miles above the FTSE 250 average of 3.3%. Let’s take a look.

Too cheap to miss?

Grainger’s share price has fallen off a cliff since the Middle East conflict began. Why? With soaring oil prices fuelling inflation, it’s possible that interest rates will be hiked, hitting the property stock’s asset values and earnings.

But have these fears been overstated? I think so, given how cheap Grainger’s shares are today. Its forward price-to-earnings (P/E) ratio has tumbled to 5.8 and its P/E-to-growth (PEG) to 0.7.

As well, the real estate investment trust (REIT) has seen its P/B ratio drop to 0.6. As with the PEG, any reading below 1 indicates a share trading below value.

Finally, Grainger’s dividend yield has jumped to 5.9%. Under REIT rules, at least 90% of annual rental profits must be paid out in dividends.

On balance, I think Grainger’s a top stock to consider in uncertain times. And especially with that rock-bottom valuation. Its focus on the stable residential property market should help it weather any storms. We all need a roof above our head, after all.

Looking longer term, Grainger has exceptional earnings potential as it steadily builds its portfolio. The company has more than 11,000 homes today, and a large development pipeline to raise that number by almost half. I think it could soar in value over time.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Another FTSE 250 bargain

Brick manufacturer Ibstock is possibly even more affected by the Iran war than Grainger. How so?

Rising interest rates threaten to derail the housing market’s fragile economy. On top of this, brickmaking is a highly energy-intensive process, leaving this FTSE 250 share vulnerable to rocketing energy prices.

Could these threats now be baked into Ibstock’s share price, though? I think so. In fact, I’m considering adding more of its shares to my existing holdings, so cheap are its shares right now.

Ibstock’s forward PEG ratio is just a fraction above 0, suggesting outstanding value. Its P/B is also under the value yardstick of 1, at 0.9.

As an investor, I’m happy to endure some short-term pain in exchange for significant long-term gain. And the potential returns I expect to make here are hugely attractive. Brick demand could accelerate sharply as Britain’s rising population fuels a housebuilding boom. Government studies suggest as many as 300,000 new homes are needed every year following years of undersupply.

Ibstock is especially well placed to capitalise on this opportunity. It’s the UK’s largest brickmaker, accounting for roughly 40% of market supply.

The post These white-hot FTSE 250 growth shares are on sale today! appeared first on The Twelfth Magpie.

There are numerous attractions, including:

• Full control over buying and selling the property.
• The ability to choose tenants, rents, and home improvements.
• The wide availability of buy-to-let mortgages to leverage returns.
• Protection from stock market volatility.
• The potential to capitalise on rising house prices.

Yet conditions have been getting tougher for buy-to-let investors in recent years. Reduced tax relief, rising mortgage rates, higher tenancy costs, and greater regulation have all made things more difficult.

And things could be about to get tougher for private landlords…

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Getting harder

Mortgage rates were set to be better in 2026 as inflationary pressures ease. But the Iran war has thrown a spanner in the works, and at least two Bank of England hikes are currently tipped for this year. Borrowing costs could spike for landlords.

That’s not the only problem facing buy-to-let investors. As I say, tighter regulation has also been a problem. And rumours are growing that the Chancellor is planning to stop private landlords from raising rents for one year as the Iran conflict hits household finances.

It’s just talk at the moment. Still, it’s another potential obstacle that would-be and existing landlords must consider.

Are REITs a better option?

My view on buy-to-let has been unchanged for years. I don’t like the upfront costs associated with buying rental property, or the day-to-day commitment of being a landlord. I also don’t like the idea of paying someone else to manage the property for me, not to mention maintenance costs that can be astronomical.

For me, investing in a REIT is far more attractive. I still get the same chance of receiving a steady stream of passive income, as buy-to-let landlords enjoy. REIT rules state at least 90% of annual rental profits must be paid out in dividends. That’s in exchange for juicy tax breaks.

I also don’t have to manage the property, and I can sell my holdings far more quickly and cheaply than a bricks-and-mortar property. Furthermore, REIT investors can invest in a far broader range of assets. I hold Primary Health Properties and Target Healthcare for instance. The benefit? They let me make money from the lucrative primary medical centre and care home sectors respectively.

A top trust to consider

But what about if investors just want to stick to residential property? I think Grainger (LSE:GRI) is a great trust to look at.

Down the years, it’s become one of the FTSE 250‘s greatest dividend growth shares. Since 2011, annual payouts have risen every year bar one. The exception was in 2021, when asset sales and pandemic pressures impacted group rental income and dividends.

What I especially like about Grainger is its enormous portfolio of 11,000+ homes. The advantage? It can still pay a reliable dividend even if some of its tenants don’t pay the rent or vacate. A buy-to-let investor with one or two properties may not have the same security.

Like any REIT, Grainger isn’t completely without risk. Higher interest rates will have a knock-on impact on its borrowing costs and therefore expansion plans. But given the choice to invest here or in buy-to-let? For me, it’s a no-brainer.

The post 3 REITs to consider as buy-to-let gets tougher in 2026! appeared first on The Twelfth Magpie.

Right now, I can see shares in each category for investors to consider. And they’re not always the most obvious names.

Associated British Foods 

The FTSE 100 currently has a dividend yield of 3.3%. And Associated British Foods (LSE:ABF) is exactly in line with this. 

That makes the next question a straightforward one – is this an above-average business? I think it might be.

The company’s main asset is Primark. And while it’s a retailer, it’s important not to underestimate just how valuable it is. Primark recently reported a fall in like-for-like sales across Europe. But that’s not as significant as it might be. 

It certainly highlights a key risk. When consumer spending is weak, lower sales can lead to price cuts that weigh on margins. Unlike the majority of publicly-traded retailers, though, Primark is still expanding rapidly. Especially in the US.

The firm currently has around 38 stores in the US. But there’s talk of this growing to over 100 by 2030, which is a big increase.

While success isn’t guaranteed, the early signs are promising. And there are also expansion plans in other countries. That means Primark’s growth isn’t limited to like-for-like sales. And it’s why I think dividend investors should take a look. 

Grainger

Despite excess inventory in the UK housing market, affordability issues remain. Enter Grainger (LSE:GRI).

Ultimately, housing is a basic need. And if people aren’t in a position to buy – for whatever reason – they have to rent.

The firm owns and leases residential properties. And it has 11,000 properties with 5,000 more in its pipeline for future growth

In terms of the dividend, the situation is a little complicated. Grainger is becoming a real estate investment trust (REIT). That means the dividend will become mandatory. But the firm should benefit from tax exemptions on its rental income.

Analysts think the result will be a yield of around 5.5%. And that might well be attractive in today’s market. 

There’s obviously a shortage of housing in the UK, so demand for Grainger’s properties should stay strong. But there are risks. One of these is regulation. Shifting standards can result in higher costs and while Grainger is well-positioned right now, that could change. 

In terms of dividends, though, this looks like an interesting business in a durable industry. And I think it’s worth a closer look. 

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Income investing

There’s more than one way to be a dividend investor. But the best opportunities are often high-quality companies that the market underestimates.

In my view, both Associated British Foods and Grainger meet this description. Neither is a high-octane bushes, but that’s not the point. 

Both combine decent dividends with strong growth prospects. And that’s what I think investors looking for passive income should prioritise.

The post 2 UK dividend stocks to consider buying in April appeared first on The Twelfth Magpie.

JD Sports Fashion (LSE:JD.), Grainger (LSE:GRI) and TBC Bank (LSE:TBCG) are three that have caught my eye this month. Each comes with an ultra-low price-to-earnings (P/E) ratio. But that’s not all that makes them great value stocks to consider buying.

Here’s why they could be too cheap for investors to ignore.

Fashion and sports star

Retailers like JD Sports face severe challenges as surging oil prices fuel inflationary pressures. But could this be baked into this FTSE 100 share’s current valuation? I think so. Fresh share price weakness leaves the sportswear giant on a forward P/E ratio of 6.5 times.

The good news for JD is key brands like Nike and Adidas are regaining popularity with consumers, latest financials show. Collectively, these top-tier brands make up the lion’s share of company sales. Even if shopper spending power becomes more constrained, their excellent brand power could support strong sales at the retailer.

Longer term, I’m optimistic JD’s profits could soar from today’s levels as global store expansion rolls on. Recent price weakness represents a new dip opportunity to consider.

Top trust

Grainger is one of the most attractive dividend stocks on offer today, in my view. Like all real estate investment trusts (REITs), it has to pay 90% or more of its rental profits out in cash to investors.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

That’s not all. It’s Britain’s largest listed operator in that most defensive of sectors: residential property. So even if economic conditions worsen and inflation bursts higher, rental income should remain broadly stable.

Higher interest rates will likely hit its share price by raising borrowing costs. This could also weigh on its growth prospects by making new housing developments prohibitively expensive. However, those REIT rules mean Grainger should still be a reliable and generous dividend growth stock.

City analysts agree, meaning a huge dividend yield of 5.1% for this financial year (to September 2025). A forward P/E ratio of 8.9 times provides an extra sweetener for value investors.

The best bank?

TBC Bank is one of the hottest growth stocks out there, in my view. Unlike Lloyds, for instance, which operates in a very mature market, this FTSE 250 bank operates in the fertile Georgian marketplace. This is one that offers the stunning combination of low product penetration and surging demand as the local economy booms.

Like other banking stocks, TBC also stands to gain from more favourable interest rates that’ll boost margins. Rising inflationary pressures are feeding expectations that central banks will stop cutting — or perhaps even hike — their lending rates.

I don’t think these factors are reflected in TBC’s low forward P/E ratio of 5.6 times. Growth could be impacted if the National Bank of Georgia raises rates, hurting the domestic economy. But I think the bank’s challenges are more than baked into that low earnings multiple.

One final thing: the dividend here for 2026 is a gigantic 6.5%.

The post These 3 FTSE 100 and FTSE 250 stocks are now dirt cheap! appeared first on The Twelfth Magpie.

Grainger (LSE:GRI) is the UK’s largest commercial landlord. It has – in my view – an enviable portfolio of properties in some attractive locations and strong rent collection metrics to boot. 

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Grainger’s portfolio

With any REIT, one of the key things to focus on is its portfolio. It has over 11,000 properties, almost all of which are currently occupied by paying tenants. 

In terms of location, these are distributed across major UK cities. And unlike other residential REITs, a significant number of them are located in London. 

As a result, the company offers the opportunity to invest in property in areas where house prices are prohibitively high. But is this something investors should be looking for?

The rise in artificial intelligence (AI) brings with it an increasing risk of redundancies, especially for white-collar workers. And these are the people that typically live in cities.

There’s a risk that this might lead to lower demand for Grainger’s properties in the future. But investors can gauge the severity of that particular threat for themselves. 

In the meantime, a couple of high-profile investing names have been taking an interest in the stock. And while that’s not itself a reason to buy, it’s worth paying attention to.

Smart money

One individual who has recently been betting on Grainger is Mike Ashley – of Sports Direct fame. The former Newcastle United owner has acquired a stake equivalent to 3.1% of the firm.

I’m choosing my words carefully here, because the number of shares Ashley has actually bought is zero. He’s made his move using derivatives, rather than buying the stock directly.

These are – or should be – almost identical to the underlying shares from an economic perspective. The only real difference is that they aren’t eligible for stamp duty. 

A non-economic difference, though, is that they don’t come with voting rights. So Ashley is presumably planning to be a passive participant, rather than an active investor. 

An institution that has been buying shares, though, is Norges Bank. The firm manages the Norwegian Sovereign Wealth Fund and has increased its stake to 9%. 

The company has over 9,000 equity investments across the world, which is a huge number. But I do think it’s significant that Grainger is on its radar as a stock worth buying. 

Time to buy?

I think there are some really interesting opportunities in UK REITs at the moment. And while Grainger has been on my list, it’s never been my top opportunity. 

News of some high-profile investment names looking to get involved has caused the stock to climb this week. And that’s probably made it slightly less attractive.

If the share price settles down a bit, I might well come back to take a closer look. But for the time being, I think there are more attractive ways to earn passive income from property.

The post Smart investors are betting on this passive income stock appeared first on The Twelfth Magpie.

Real estate investment trusts (REITs) allow investors to avoid the high upfront costs and day-to-day management that typically comes with buy-to-let. What’s more, thanks to rules on dividends, these trusts can also be a better way to target a large and stable second income.

Furthermore, if purchased within an ISA, investors don’t pay tax on any of their passive income or capital gains. It’s a perk that buy-to-let landlords would love to have.

With all this in mind, which REIT stocks should investors consider buying today?

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Investing in an ISA

The beauty of REITs is that I can have a range of sectors to choose from. Unlike buy-to-let, where investment is restricted to residential property, in the UK I can choose to invest in, for instance:

• Medical centres
• Shopping malls

• Data centres
• Care homes
• Office blocks
• Warehouses and distribution centres

For residential property investment, Grainger (LSE:GRI) is a top trust to consider in my book. It has 11,078 homes spanning the country on its books, and a committed pipeline of 954 more homes to supercharge rental earnings.

Having a wide range of properties like this reduces the impact of rent defaults and empty properties on overall returns. For the last financial year (to September 2025), Grainger’s occupancy averaged an impressive 98.1%.

For buy-to-let investors owning maybe one or just a handful of homes, these dangers are much more severe.

There are risks at Grainger, of course. Government plans to build 300,000 new homes a year might harm future rent growth as supply increases. Rising regulation — such as the Rent Reform Bill this year that limits rent increases and bans no-fault evictions — is another threat to future earnings.

Yet these are threats facing private landlords too.

REIT benefits

I like the idea of investing in residential real estate right now. Rent growth has slowed in the UK, but with Grainger targeting a rise of 3% to 3.5% this year, investors can still expect a solid return on their cash.

I also like the excellent defensive characteristics of residential property. Rental income and occupancy remains steady across the economic cycle, providing excellent long-term dividend stability.

With REITs paying 90% of rental profits out in dividends each year, too, they’re one of the best ways to target passive income in my view.

Targeting a million

By investing in an ISA, individuals can combine buying REITs like this with other shares to target better returns that they could otherwise expect by just buying property.

Since 2015, the average Stocks and Shares ISA has delivered an average annual return of 9.64%. If this continues, someone investing just £500 a month could make more than a million (£1.05m to be exact) in 30 years.

I hold a wide range of REITs and stocks in my own portfolio. I’m confident this strategy will help me build significant wealth over time.

The post Forget buy-to-let! Aim for a million with a Stocks and Shares ISA instead appeared first on The Twelfth Magpie.