SUM - Summerset Group

[trader_jackson]

Forsyth downgraded SUM price target by 10% today to $6.60 (still way above current share price I suppose)... FY19 earnings downgraded 8%, FY20 downgraded 11% and FY21 downgraded 14%... they clearly have started to see the writing on the wall and realize the market simply wasn't buying their previous $7.35 price target... as I've said before, while sum companies are increasing build rates, margins, and earnings throughout the cycle, sum others are really struggling... sum say this is because those companies were too focused on short term profits (build more and more and more!) rather than focusing on building culture and continuum of care capabilities (which short term: of course they drag on earnings, but long term: support the entire value proposition of the village[s])... the 'gold standard' Ryman has always focused on its care side of things just as much as its development, you'd think sum would have learned there is a reason why they did this and didn't just build lots of units.

Ironic that we were told for years by sum on here that how sum is a great long term investment, will only go up (or words to that effect)... and yet it seems sum were all about borrow high, build big, and cross our fingers things sell... while in the back end the care side of things was severely under developed (not only in terms of beds to units ratio but also in strategy and capability) and the housing market was slowing down... all accumulating in an overhang of units, not a very strong value proposition (to move into a sum village), and a dramatic downgrade in build rate from 600 to 300 ish while they try fix things.

And yet we still hear about the past, about how sum outperformed in the past... of course if you put short term profits ahead of long term prospects and combine that with a huge appreciation in house prices, you will outperform... but these things never last, and I don't know about sum other people, but I don't live in the past.

Ah well, at least sum isn't alone... MET also did the same (and they have leaky buildings as well!)

[bull....]

Forsyth downgraded SUM price target by 10% today to $6.60 (still way above current share price I suppose)... FY19 earnings downgraded 8%, FY20 downgraded 11% and FY21 downgraded 14%... they clearly have started to see the writing on the wall and realize the market simply wasn't buying their previous $7.35 price target... as I've said before, while sum companies are increasing build rates, margins, and earnings throughout the cycle, sum others are really struggling... sum say this is because those companies were too focused on short term profits (build more and more and more!) rather than focusing on building culture and continuum of care capabilities (which short term: of course they drag on earnings, but long term: support the entire value proposition of the village[s])... the 'gold standard' Ryman has always focused on its care side of things just as much as its development, you'd think sum would have learned there is a reason why they did this and didn't just build lots of units.

Ironic that we were told for years by sum on here that how sum is a great long term investment, will only go up (or words to that effect)... and yet it seems sum were all about borrow high, build big, and cross our fingers things sell... while in the back end the care side of things was severely under developed (not only in terms of beds to units ratio but also in strategy and capability) and the housing market was slowing down... all accumulating in an overhang of units, not a very strong value proposition (to move into a sum village), and a dramatic downgrade in build rate from 600 to 300 ish while they try fix things.

And yet we still hear about the past, about how sum outperformed in the past... of course if you put short term profits ahead of long term prospects and combine that with a huge appreciation in house prices, you will outperform... but these things never last, and I don't know about sum other people, but I don't live in the past.

Ah well, at least sum isn't alone... MET also did the same (and they have leaky buildings as well!)

i imagine more people will dump summerset now after this big downgrade

[Ggcc]

i imagine more people will dump summerset now after this big downgrade
I am sorry, but many here including myself don't rate Forsyth Barr as giving consistent fantastic advice. I would not rate SUM as being worth $7.35 nor Ryman what they are worth. The market determines the value of share price.

[bull....]

I am sorry, but many here including myself don't rate Forsyth Barr as giving consistent fantastic advice. I would not rate SUM as being worth $7.35 nor Ryman what they are worth. The market determines the value of share price.

yes correct the market does judge what the shares are worth and it is not looking pretty at the moment. estabilished downtrend in price suggest lower prices for sure are coming unless there is some catalyst to change the trend but i dont see anything at the moment.

[BlackPeter]

i imagine more people will dump summerset now after this big downgrade

Hmm - why would anybody dump a share at or below $5.50 if the same people who downgraded the earnings from "outrageous" to "great" proposed a price target of $6.60?

Your post does not make sense ....

[bull....]

Hmm - why would anybody dump a share at or below $5.50 if the same people who downgraded the earnings from "outrageous" to "great" proposed a price target of $6.60?

Your post does not make sense ....

lowering of a price target is a downgrade if they put there target price up that would be a upgrade. take the price levels with a grain of salt

[macduffy]

Strangely, though, not everyone pays a lot of attention to FB's downgrades/upgrades. There are those who see them as potential buy/sell signals, respectively!

:cool:

[percy]

Strangely, though, not everyone pays a lot of attention to FB's downgrades/upgrades. There are those who see them as potential buy/sell signals, respectively!

:cool:

Reminds me of the widower, who could not understand how his late wife's share portfolio, was worth a great deal more than his,until he figured out she read his broker's recommendations, and brought those shares,but never followed on his sell recmmendations. .

[tuaman]

https://www.stuff.co.nz/business/113887800/bad-news-for-buyers-property-listings-hit-record-lows


Quote "The Auckland region saw asking prices creep back up over $900,000 on average, after a three month slump"

Trend turning?

[King1212]

https://www.stuff.co.nz/business/113887800/bad-news-for-buyers-property-listings-hit-record-lows


Quote "The Auckland region saw asking prices creep back up over $900,000 on average, after a three month slump"

Trend turning?

not too fast....property market moves around 7-8 years....it will plateauing....the next move will be next 5 years....

[tuaman]

yeah but I mean "SUM" share price, no more down pressure sort of trends.


not too fast....property market moves around 7-8 years....it will plateauing....the next move will be next 5 years....

[bull....]

applies to all

But residents of retirement villages shifting into on-site rest home care could find themselves faced with extra charges, a report from the Commission for Financial Capability said

https://www.stuff.co.nz/business/money/113834185/retirement-village-review-calls-for-better-disclosure-of-extra-charges-for-premium-rest-home-rooms

[trader_jackson]

applies to all

But residents of retirement villages shifting into on-site rest home care could find themselves faced with extra charges, a report from the Commission for Financial Capability said

https://www.stuff.co.nz/business/money/113834185/retirement-village-review-calls-for-better-disclosure-of-extra-charges-for-premium-rest-home-rooms

Interesting, doesn't OCA often brag, I mean talk about, their PAC and how much it has increased?

PAC = Premium accommodation charge on a care bed for accommodation provided above the mandated minimum

[Food4Thought]

not too fast....property market moves around 7-8 years....it will plateauing....the next move will be next 5 years....

Over the next 5 years or after 5 years?

I keep thinking back to the population in the 1950s (globally and country specific)... versus now... and how fast technology and population growth is moving. I get a feeling there is some serious unchartered territory coming up...

[Lewylewylewy]

Agree to that. Trends are only relevant if the underlying factors are the same.

I wonder. Given that SUM offer more focus on nice homes, and given that the property market is losing steam, if people will hold off moving until they need to. Which means more needs based requirements, not the snazzy houses SUM offer. I wonder if SUM will dwindle while cheap, care focused villages will benefit (OCA).

Or maybe they'll all perform poorly as punters don't take the upsell (where all the money is).

[tuaman]

https://www.abc.net.au/news/2019-07-01/home-prices-still-falling-but-not-in-sydney-and-melbourne/11266364

its only been two years and now it seems turning...



Over the next 5 years or after 5 years?

I keep thinking back to the population in the 1950s (globally and country specific)... versus now... and how fast technology and population growth is moving. I get a feeling there is some serious unchartered territory coming up...

[macduffy]

https://www.abc.net.au/news/2019-07-01/home-prices-still-falling-but-not-in-sydney-and-melbourne/11266364

its only been two years and now it seems turning...

I'd wait a while before calling a "turning". These were small, one month, changes!

:mellow:

[Ggcc]

Slowly increasing over the last two weeks. Nice to see up momentum......... I hope I have not jinxed it lol

[oldtech]

I'm watching closely ... the MACD is positive and trending upwards, but the 30 day MA is still well below the 100 day MA.

I have also seen suggestions that the Q2 results which are due out shortly may well be disappointing, pushing the SP lower ...

I'm still sitting on the sidelines with this one. I badly mistimed this one, buying shares in the $6 and $7 range, so well under water and approaching with caution. I'm keen to average down, but not so keen that I'm going to leap in just yet.

Which may well mean I miss a golden opportunity, but there you go ...

[SilverBack]

The housing shortage and companion residential price increase has been amplified in the past few years by a high level of net immigration. Don't forget that is an aberration from the norm and we could easily return to a net emigration if the NZ economy goes down but Australia and the UK or Canada remain OK. I realise that the housing shortage has resulted from more than just the migration trend but that is the most recent underlying factor.

[dreamcatcher]

Wonder how many Aust, Chinese or Indians would use retirement villages as family generally care for their elders or may simply go home ? plus -8600 kiwi leaving.

In the November 2018 year, the provisional migration estimates by country of last permanent residence showed:



19 percent of migrant arrivals were from Australia, of which 64 percent were New Zealand citizens and 25 percent were Australian citizens
11 percent were from China
10 percent were from India
8 percent were from the United Kingdom.Year ended Nov 2018


35800 kiwi Arrivals
44400 kiwi Departures ..........kiwi loss of -8600

[Food4Thought]

Wonder how many Aust, Chinese or Indians would use retirement villages as family generally care for their elders or may simply go home ? plus -8600 kiwi leaving.

In the November 2018 year, the provisional migration estimates by country of last permanent residence showed:



19 percent of migrant arrivals were from Australia, of which 64 percent were New Zealand citizens and 25 percent were Australian citizens
11 percent were from China
10 percent were from India
8 percent were from the United Kingdom.Year ended Nov 2018


35800 kiwi Arrivals
44400 kiwi Departures ..........kiwi loss of -8600

Great detail. Thank you Dreamcatcher.

What about the money side... if 2 leave with 100k spending money and 2 arrive with
500k spending money... do the kiwis leaving take all their assets or leave a huge portion...

Ages of people leaving versus ages of people arriving. Intended stay time...

The have nots and the haves.

Like to see this data.

[SilverBack]

Wonder how many Aust, Chinese or Indians would use retirement villages as family generally care for their elders or may simply go home ? plus -8600 kiwi leaving.

In the November 2018 year, the provisional migration estimates by country of last permanent residence showed:



19 percent of migrant arrivals were from Australia, of which 64 percent were New Zealand citizens and 25 percent were Australian citizens
11 percent were from China
10 percent were from India
8 percent were from the United Kingdom.Year ended Nov 2018


35800 kiwi Arrivals
44400 kiwi Departures ..........kiwi loss of -8600

Are you telling us that we have already reverted to net outward migration? Perhaps that is why Phil Twyford had trouble selling houses?
SUM needs increasing house prices to keep jacking up its resale values.

Now, there is a conumdrum (or is it Catch 54?). Labour has to sell more Kiwi Build to look successful and to fend off The Crusher. The best way to do that is to increase the housing shortage that Kiwi Build was supposed to reduce. In so doing it will increase the profits of the retirement industry that it no doubt also wants to repress.

[dreamcatcher]

Great detail. Thank you Dreamcatcher.

What about the money side... if 2 leave with 100k spending money and 2 arrive with
500k spending money... do the kiwis leaving take all their assets or leave a huge portion...

Ages of people leaving versus ages of people arriving. Intended stay time...

The have nots and the haves.

Like to see this data.

Personal view my assets remained in NZ when I went overseas. But after returning sold all my rentals as felt 10yrs of capital gains was a thing of the past and properties been debt free, reward from rent was peanuts to value of homes.

Family recently took a $120k haircut selling property but scored a 60k reduction against purchase but people say market is improving ?

I await SUM update that things are improving until then hands in pockets for me.

[dreamcatcher]

Are you telling us that we have already reverted to net outward migration? Perhaps that is why Phil Twyford had trouble selling houses?
SUM needs increasing house prices to keep jacking up its resale values.

Now, there is a conumdrum (or is it Catch 54?). Labour has to sell more Kiwi Build to look successful and to fend off The Crusher. The best way to do that is to increase the housing shortage that Kiwi Build was supposed to reduce. In so doing it will increase the profits of the retirement industry that it no doubt also wants to repress.

No migration is still positive 56,100 but revised down from 61,600 just more KIWI'S leaving then KIWI'S arriving

[macduffy]

No migration is still positive 56,100 but revised down from 61,600 just more KIWI'S leaving then KIWI'S arriving

A sure sign that immigration is on the way down. This morning's DomPost has a full page advert by MBIE seeking applications for eight General Managers and a dozen National Managers of various types for Immigation NZ!

[Scrunch]

A sure sign that immigration is on the way down. This morning's DomPost has a full page advert by MBIE seeking applications for eight General Managers and a dozen National Managers of various types for Immigation NZ!

Net migration may be decreasing, but its still at a high level, just down from a super-high level. With a population of around 5 million, net migration of 56,100 is still adding more than 1% pa to the number of people living in NZ.

This 1% is not spread evenly and tends to be primarily individuals aged in their 20's and early 30's. This means that 5 years ago, no individual age had more than 65,000 people, but the late-40's/early 50's was just under 65k, as was an early 20's bulge. Now every age from 21 to 30 has more than 70,000 people and the peak at age 27 is 78,640 people. This new population peak is now a lot bigger than the "baby boomers" but its 40 years before they get into the retirement villages.

The peak that was at age 50 in 2014 has continued to age and is now 55 and migration/early deaths have cancelled out to leave it the same size. Curious stat - the size of the net migration flow is such that the NZ Median age has decreased over the last five years (37.5 to 36.9). That's an interesting fact inlight of commentary about an aging population.

[Blue Skies]

I wouldn't put too much weight on those immigration fluctuations.
To keep things in perspective, NZ's 65+ population projected to double from 711,000 in 2016 to around 1.4 Million in next 26/27 years.

And looking around the world at the moment with the huge challenges Australia faces with climate change (water supply & soaring temperatures for much of the continent), UK with Brexit mess, EU mess etc etc, NZ looking like some kind of heaven for many people.

[Food4Thought]

I wouldn't put too much weight on those immigration fluctuations.
To keep things in perspective, NZ's 65+ population projected to double from 711,000 in 2016 to around 1.4 Million in next 26/27 years.

And looking around the world at the moment with the huge challenges Australia faces with climate change (water supply & soaring temperatures for much of the continent), UK with Brexit mess, EU mess etc etc, NZ looking like some kind of heaven for many people.

I agree with those realities. It would make interesting comparison with small ideal locations in Europe where population kept growing but desirable locations didnt increase. The trend is your friend

[dreamcatcher]

Good bounce but both SUM & RYM showing Overbought

[bull....]

confirms the trend developing of lower sales and confirms the market has been right in selling down the share price in the last yr

https://www.nzx.com/announcements/337306

[BlackPeter]

confirms the trend developing of lower sales and confirms the market has been right in selling down the share price in the last yr

https://www.nzx.com/announcements/337306

True - sales trend flat at best:

10659

... but then - this stock is compared to other great NZ companies cheap like chips. Forward PE of 10 - asking for additional growth at these prices would be greedy, wouldn't it?

Great bargain while the down-rampers do their moves and the lemmings keep jumping. Keep going - I'd like to accumulate still a bit cheaper ;); Only interested in the SP in a decade or two from now :);

[trader_jackson]

True - sales trend flat at best:

10659

... but then - this stock is compared to other great NZ companies cheap like chips. Forward PE of 10 - asking for additional growth at these prices would be greedy, wouldn't it?

Great bargain while the down-rampers do their moves and the lemmings keep jumping. Keep going - I'd like to accumulate still a bit cheaper ;); Only interested in the SP in a decade or two from now :);

And margins probably dropping as well = not great earnings , but hey, 2nd half 19 everything is going to turn around.

At least it is not expensive, nearly at fair value, but not cheap given the sum head still present

[bull....]

True - sales trend flat at best:

10659

... but then - this stock is compared to other great NZ companies cheap like chips. Forward PE of 10 - asking for additional growth at these prices would be greedy, wouldn't it?

Great bargain while the down-rampers do their moves and the lemmings keep jumping. Keep going - I'd like to accumulate still a bit cheaper ;); Only interested in the SP in a decade or two from now :);

you once showed me your red line chart , how is that plotting now? anyway sales increase if it happens in 2nd half does not hide the fact sales yr on yr will likely be down

[BlackPeter]

you once showed me your red line chart , how is that plotting now? anyway sales increase if it happens in 2nd half does not hide the fact sales yr on yr will likely be down

Not quite sure, which you mean - this is the last SUM chart I think I posted which has a "red line":

10660

or do you mean this:

10661

I never said that the red line in any of the charts is my "red line" (and it isn't - if you are talking about stop losses) ... but as far as I can see is the current SP nicely hovering above ...

For some stocks I use stop losses, for others I would use the same indicators as buy signal (buy cheap, sell dear ...). SUM belongs into the second category.

PS: While I tend from time to time to rebalance my portfolio ... my overall SUM account is in pretty big and black numbers and at current I am accumulating. Good stock ...

[JayRiggs]

10662
I don't get it.
RYM new sales occupation rights have been falling the last 3 years as well.
2017: 600
2018: 458
2019: 414

But yet RYM's share price remains stronger than SUM!!!

[bull....]

10662
I don't get it.
RYM new sales occupation rights have been falling the last 3 years as well.
2017: 600
2018: 458
2019: 414

But yet RYM's share price remains stronger than SUM!!!

both declining new sales
think there share prices were tracking each other ( down and highly correlated from sept last yr) until sums agm commentary in april which caused the big drop.

[trader_jackson]

Jeez I think SUM did well today, not really that close to the 52 week low ($5.35), yet I felt the announcement indicated things were the worst in 52 weeks...

http://www.scoop.co.nz/stories/BU1907/S00201/summersets-q2-sales-down-96-says-market-stabilising.htm

Gets even worse when you read Q2 announcement from 2018, which showed total occupations rights dropping from 323 in 1H 2017 to 299 in 1H 2018 and now to 277... oh well at least resales haven't changed much... but given SUM's ever increase total units built, resales are going down as a % when they should probably (if sum were doing well) be tracking upward a bit, given they are continually growing the portfolio of units... but we all know (well, at least told from those that know) the big money is in the development... and, unfortunately, those numbers (therefore) have been hit the hardest... At FY, I'd forecast that resales stay the same (at 300) for and probably only around 330 new unit sales (wait, didn't they want to build 450 units this year and 600 or something in the coming years?? Wishful thinking or was I just imagining things?)

One thing is for sure, what ever the new resales number is at FY, it'll probably be a far cry from the 414 new units sold back in the boom times of 2016... if only they had invested in their care facilities, they might find there would be a bit more interest/reason to move into sum village instead of other villages... they might have found today, after making that upfront investment a couple years ago, all the units they are building (and the dozens they have built and haven't been able to sell) might be moving a bit faster/easier... but that wouldn't have been good for shareholder returns in 2016!

EPS has a track record of going up 40% or something annually, and we are going to have $1 in EPS in just a few years, so lets ignore the trends and hope the margins are over 30% and those sum sales managers close deals like they've never closed before to get a good Q4 (even if it means a rubbish Q1 2020).

[trader_jackson]

10662
I don't get it.
RYM new sales occupation rights have been falling the last 3 years as well.
2017: 600
2018: 458
2019: 414

But yet RYM's share price remains stronger than SUM!!!

RYM has a far stronger care offering is probably why it has held up alot more... if someone offered you a 500k apartment but when your health deteriorates, you have to go down the road to a RYM or some other care home because sum doesn't have any space for you (and spend more time, effort and money to do so), vs a 500k apartment but you have all your care (pretty much) lined up for you in the same place (or at least get priority), which one would you choose?

I think there are several on this form who under estimate the importance (especially as time goes on) in offering a strong continuum of care to prospective purchasers...

[Lewylewylewy]

I view sum as a property investment and the others as a retirement home business with a property element.

Ergo: sum should increase at a faster rate than others during property booms, but underperform the others in property depressions.

[MauroNZ]

both declining new sales
think there share prices were tracking each other ( down and highly correlated from sept last yr) until sums agm commentary in april which caused the big drop.

The big drop happened on the 4th of April and the AGM was at the end of April.

[Blue Skies]

The big drop happened on the 4th of April and the AGM was at the end of April.

Yes, Thurs 4 April there was a massive drop, well in advance of the AGM commentary. Any ideas what caused this? What are we supposed to read into this?

[winner69]

Yes, Thurs 4 April there was a massive drop, well in advance of the AGM commentary. Any ideas what caused this? What are we supposed to read into this?

Shocking Q1 sales report

[bull....]

Shocking Q1 sales report

yes not good , whats worse is the dreaded death cross on the hrly charts combined with the steady down trend doesnt look good at the moment.

[BlackPeter]

Shocking Q1 sales report


yes not good , whats worse is the dreaded death cross on the hrly charts combined with the steady down trend doesnt look good at the moment.

Quite amusing ... winner was commenting on a historic SP phenomena after Q1/2018.

But anyway - what cross of death? SP went 3 cents up today ... are you using shorter and down ramper terminology?

[davflaws]

Yeah - had me puzzled for a moment or two

[bull....]

Quite amusing ... winner was commenting on a historic SP phenomena after Q1/2018.

But anyway - what cross of death? SP went 3 cents up today ... are you using shorter and down ramper terminology?

you need to brush up on your T/A

What is a Death Cross?The death cross is a technical chart pattern indicating the potential for a major selloff. The death cross appears on a chart when a stock’s short-term moving average crosses below its long-term moving average (https://www.investopedia.com/terms/m/movingaverage.asp)

[BlackPeter]

you need to brush up on your T/A

What is a Death Cross?The death cross is a technical chart pattern indicating the potential for a major selloff. The death cross appears on a chart when a stock’s short-term moving average crosses below its long-term moving average (https://www.investopedia.com/terms/m/movingaverage.asp)


Amazing ... Thank You Master! I feel blessed with the bulls wisdom ... even if most analysts agree that the Cross of death is a lagging indicator - i.e. when you see it confirms that you are too late);

It is just - you clearly can't talk about he usually used MA50 and MA200 - i.e. what moving averages have you seen crossing today?

[bull....]

Amazing ... Thank You Master! I feel blessed with the bulls wisdom ... even if most analysts agree that the Cross of death is a lagging indicator - i.e. when you see it confirms that you are too late);

It is just - you clearly can't talk about he usually used MA50 and MA200 - i.e. what moving averages have you seen crossing today?

Im glad you recognised Master Bull.... but on a more serious note MA50 AND MA200 why do they have to be these? A death cross can be any multiple you like.
I prefer backtesting to see historically which multiples have performed best to work out the multiples I use for my dreaded death cross.

[BlackPeter]

Im glad you recognised Master Bull.... but on a more serious note MA50 AND MA200 why do they have to be these? A death cross can be any multiple you like.
I prefer backtesting to see historically which multiples have performed best to work out the multiples I use for my dreaded death cross.

They don't have to. It is just one of these conventions. Makes communication with others easier if both sides use the same definition.

OK - So you say you call a crossing of other MA's then everybody else the cross of death. Makes life more complicated, but fine with me.

However - you still didn't reveal which MA's supposedly did cross today in this sinister way? I don't know - and it appears you don't either ...

[winner69]

They don't have to. It is just one of these conventions. Makes communication with others easier if both sides use the same definition.

OK - So you say you call a crossing of other MA's then everybody else the cross of death. Makes life more complicated, but fine with me.

However - you still didn't reveal which MA's supposedly did cross today in this sinister way? I don't know - and it appears you don't either ...

I see it BP on this 5 day chart

[dreamcatcher]

Interesting amount of single digit low number trades today and at 5pm SP boots to 5.70 ? ..........:confused:

[trader_jackson]

Oh boy... Habour Asset Management buying SUM... I'd usually take an asset management firm buying up shares in xyz listed company as a good sign... but then you realise these guys are the ones who made a joke of themselves valuing their 7.32% stake in CBL Insurance at 28 cents a share (when we all knew it was worth nothing), but more worrying still is that they are the biggest holder of PEB with a whopping 16.47% stake (as at 31 March 2019)... both of these are fairly recent... and today these guys are disclosed buying more SUM........ given Harbour's very questionable recent track record (and its all about track records, as we know only to well on this form) I would think it is hard to get excited about them continuing to sink money into SUM.
Then again forsyth (the ones who like ARV) think SUM is pretty okay as well

[winner69]

Oh boy... Habour Asset Management buying SUM... I'd usually take an asset management firm buying up shares in xyz listed company as a good sign... but then you realise these guys are the ones who made a joke of themselves valuing their 7.32% stake in CBL Insurance at 28 cents a share (when we all knew it was worth nothing), but more worrying still is that they are the biggest holder of PEB with a whopping 16.47% stake (as at 31 March 2019)... both of these are fairly recent... and today these guys are disclosed buying more SUM........ given Harbour's very questionable recent track record (and its all about track records, as we know only to well on this form) I would think it is hard to get excited about them continuing to sink money into SUM.
Then again forsyth (the ones who like ARV) think SUM is pretty okay as well

Harbour have plenty of A2

[Vaygor1]

Wow. What a month!.. and it isn't even up yet.

Using my 1 hour MA and 1.25 day MA, there has been 16 Black Crosses and 15 Golden Crosses this month

We sure live in volatile times.

[winner69]

Wow. What a month!.. and it isn't even up yet.

Using my 1 hour MA and 1.25 day MA, there has been 16 Black Crosses and 15 Golden Crosses this month

We sure live in volatile times.

Good that more black crosses than golden crosses results in an upward movement in share price over the last month.

[Joshuatree]

1 year share price performance on NZX (not including any dilution etc)

MET -28.7%
SUM -26.63%
OCA -4.5%
RYM +7.8%
ARV +9.88%

Kudos to TJ and fellows.

[Yoda]

1 year share price performance on NZX (not including any dilution etc)

MET -28.7%
SUM -26.63%
OCA -4.5%
RYM +7.8%
ARV +9.88%

Kudos to TJ and fellows.
why would you invest in any of them at those stats ......
Maybe what goes down, must come up...eventually .

ps.. holding SUM

[macduffy]

Today:

SUM $5.70
RYM $13.37

Wasn't there once a neat little "rule" that had SUM at 50% of RYM's shareprice?

;)

[Scrunch]

Today:

SUM $5.70
RYM $13.37

Wasn't there once a neat little "rule" that had SUM at 50% of RYM's shareprice?

;)

Yea, but IMO there appears to be hot money chasing the top end of the NZX listings. RYM falls into that group, SUM is a bit smaller doesn't have a multi-billion market cap. This is assisting SUM to testing the lower end of this rule. Poor sales by SUM aren't helping.

[dreamcatcher]

Property prices fall but Sales increase...........July

http://www.sharechat.co.nz/article/a64ebc08/barfoot-thompson-says-auckland-housing-market-moving-again.html

[dreamcatcher]

Auckland's housing market no longer flatlining as new data shows prices are actually falling....................

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12256048

[Baa_Baa]

Yea, but IMO there appears to be hot money chasing the top end of the NZX listings. RYM falls into that group, SUM is a bit smaller doesn't have a multi-billion market cap. This is assisting SUM to testing the lower end of this rule. Poor sales by SUM aren't helping.

All will be revealed next week, Tuesday 13th half year results. Market imo will be looking for a material improvement in sales performance. Everything else $ has been predicted in detail here and elsewhere.

[Balance]

Auckland's housing market no longer flatlining as new data shows prices are actually falling....................

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12256048

Property valuations are all based upon previous comparative sales value.

Very nice on the way up for the sales people ('Buy as prices are going up and you will miss out' to the buyers) but extremely painful for the house owners on the way down ('Real market is going down, you better sell quick' to the sellers).

So it's going to be down for another 4 years imo.

[Ggcc]

Some big numbers going through SUM today. Things must be gearing up as this month we find out how they are performing.

[Baa_Baa]

Some big numbers going through SUM today. Things must be gearing up as this month we find out how they are performing.

Tomorrow, we find out.

[Beagle]

Some big numbers going through SUM today. Things must be gearing up as this month we find out how they are performing.

Maybe Norah is buying back in :D

[Ggcc]

Tomorrow, we find out.
Goodness how time flies 😊

[winner69]

Maybe Norah is buying back in :D

No - Harbour and Kingfish buying before the big jump.

I see that Kingfish have more RYM than SUM now ...at June 30th was the other way around. RYM snuck into their Top 5 ..must be hind they are pretty good.

[trader_jackson]

Now growing as slow as that other dog starting with A... shows you how lofty the valuation was nearly touching $8 odd... operating cash flows barely up, and Available new sales uncontracted stock at the highest point in 5 years - not a good metric to be at the highest point in 5 years (and that is despite pulling back big time on new builds)... gearing ratio up as well (at a record level?)
Alot of negatives on slide 4

[winner69]

Highlight of a pretty ho hum report definitely becoming the first retirement village operator in New Zealand to achieve CarboNZero certification

That’s far more meritorious than Scott Scoullar being named 2019 NZ CFO of the Year ...possibly a rather dubious honour


Good stuff

[trader_jackson]

Highlight of a pretty ho hum report definitely becoming the first retirement village operator in New Zealand to achieve CarboNZero certification

Good stuff

winner I liked the comment(s) on CAGR (eg slid 35)... how we have to continue to be excited (and pay lavish price to NTA ratios etc) even though things are very clearly slowing down big time over the past couple of years... werid how they still want to lift to building 600 things pa, yet unsold stock is ever increasing... given they can't sell the things, you'd think they wouldn't be so gung-ho on increasing build rates

I found it funny [borderline a joke] the top comment on slide 10 "Focus on continuum of care model" ... hard to focus on that when they have only 18% of their portfolio being care based and hardly any slides were devoted to care (eg net promoter scores of care business or % total villages with 4 year certification)
(you reckon they are waking up to what I have mentioned multiple times over the past months and years that this [continuum of care] really will be ever more important over the coming years?)

[winner69]

winner I liked the comment(s) on CAGR (eg slid 35)... how we have to continue to be excited (and pay lavish price to NTA ratios etc) even though things are very clearly slowing down big time over the past couple of years... werid how they still want to lift to building 600 things pa, yet unsold stock is ever increasing... given they can't sell the things, you'd think they wouldn't be so gung-ho on increasing build rates

I found it funny [borderline a joke] the top comment on slide 10 "Focus on continuum of care model" ... hard to focus on that when they have only 18% of their portfolio being care based and hardly any slides were devoted to care (eg net promoter scores of care business or % total villages with 4 year certification)
(you reckon they are waking up to what I have mentioned multiple times over the past months and years that this [continuum of care' will be ever more important over the coming years?)

Yes indeed ...that touted 42% pa CAGR in underlying earnings now down to 36% pa I note .....and possibly in a few years will be less than 10% pa

[winner69]

winner I liked the comment(s) on CAGR (eg slid 35)... how we have to continue to be excited (and pay lavish price to NTA ratios etc) even though things are very clearly slowing down big time over the past couple of years...
)[/SIZE]

Current share price 1.25 times Book Value ....definitely not outrageously cheap ...maybe just a little on cheap side ....trying to be nice here

[Ggcc]

Just a few things I picked up from the slides. Everything seems business as usual.

In the second half of this year we are officially opening three new villages, in Avonhead (Christchurch), Kenepuru (Wellington), and Richmond (Tasman). These sites have already seen good levels of pre-sales interest and settlements. We expect this will result in an increase in our new sales settlements in the second half of the year and this will be reflected in our financial results.


In February, we signalled that we were looking for land in Victoria, Australia. We are currently in the process of carrying out due diligence on a number of potential sites.

Total assets grew to $3.0 billion, up 24% on the same period last year.

Embedded value at $694 million

I think it is too early to judge how the company is performing, but I will continue to hold. SUM looks promising for the future, but like all Retirement sectors they are struggling with the housing sentiment. House prices are not dropping a lot if anything, but they are just taking longer to sell.

[trader_jackson]

Current share price 1.25 times Book Value ....definitely not outrageously cheap ...maybe just a little on cheap side ....trying to be nice here

Need the sum flag waivers to tell us what is so great about sum vs others as I am struggling to see it (have been for a while), but at least now there is sum numbers to support why I've been struggling to see what is so great about sum these days
It should be extremely worrying that the percentage available new sales uncontracted is continuously climbing, especially given they have been building less

[winner69]

Need the sum flag waivers to tell us what is so great about sum vs others as I am struggling to see it (have been for a while), but at least now there is sum numbers to support why I've been struggling to see what is so great about sum these days
It should be extremely worrying that the percentage available new sales uncontracted is continuously climbing, especially given they have been building less

To be fair t_j SUM as a company is about as great as the others in the sector (might leave MET out of the discussion though) even though each concentrates on different things

But as long as theyball keep building things and property prices keep going up we’ll be OK (even though banks and residents own more than 60% of the properties)

[Balance]

In February, we signalled that we were looking for land in Victoria, Australia. We are currently in the process of carrying out due diligence on a number of potential sites.

House prices are not dropping a lot if anything, but they are just taking longer to sell.


House prices are dropping and getting worse by the month - Developer I know very well is being offered development land and sections at ever cheaper prices as the squeeze intensifies.

And even as I wrote the above, this alert flashed across my mobile - https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12257989

"Mid-winter is hitting the housing market with national and Auckland prices down, according to the latest Real Estate Institute data for July."

And this is only the first year start of the leg of a typical 5 year down cycle.

As for going over to Australia where the property market is in free fall, a big red flag if ever I see one! Growth for growth's sake is the philosophy of a cancer cell - it ultimately destroys the body proper.

[winner69]

House prices are dropping and getting worse by the month - Developer I know very well is being offered development land and sections at ever cheaper prices as the squeeze intensifies.

And even as I wrote the above, this alert flashed across my mobile - https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12257989

"Mid-winter is hitting the housing market with national and Auckland prices down, according to the latest Real Estate Institute data for July."

And this is only the first year start of the leg of a typical 5 year down cycle.

As for going over to Australia where the property market is in free fall, a big red flag if ever I see one!

REINZ use good old real estate agent talk in their news release pointing to a booming market HIGHEST NUMBER OF PROPERTIES SOLD ACROSS NZ IN MONTH OF JULY FOR 3 YEARS

[Beagle]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SUM/338975/305148.pdf

Solid result. Embedded value at record level's points towards steady underlying profit growth in the years ahead.

[Balance]

REINZ use good old real estate agent talk in their news release pointing to a booming market HIGHEST NUMBER OF PROPERTIES SOLD ACROSS NZ IN MONTH OF JULY FOR 3 YEARS

Don't you just love them real estate agents and industry players? :D

Meanwhile real estate agents are busy telling committed vendors how difficult it is to sell properties out there and why they need to bring down prices before prices go down further! At the same time, they are telling prospective vendors that there is good demand out there - just needs a bit of time to get the price they are looking for!

Get the mandate to sell first, list for a few weeks and then : "It's a buyers' market" - the current catch cry of the industry to sellers.

Two years' ago, it was "It's a sellers' market"!

[Beagle]

Very easy to get tunnel vision when working with Auckland real estate. Shift to Nelson or Napier to name just two other area's and you'd be forgiven for thinking we're in a boom. Summerset has villages well spread throughout most of the country.

[Balance]

Very easy to get tunnel vision when working with Auckland real estate. Shift to Nelson or Napier to name just two other area's and you'd be forgiven for thinking we're in a boom. Summerset has villages well spread throughout most of the country.

Matter of time - where Auckland goes, rest of country follows.

This is the first leg of a down cycle of 5 years.

If you are in Christchurch, you'd be forgiven for thinking we are in a recession!

I think a name change by the company to Summerrise rather than Summerset might help the share price though.

[iceman]

Matter of time - where Auckland goes, rest of country follows.

This is the first leg of a down cycle of 5 years.

If you are in Christchurch, you'd be forgiven for thinking we are in a recession!

I think a name change by the company to Summerrise rather than Summerset might help the share price though.

Maybe the rest of the country follows Auckland to a degree but here in Nelson we most certainly did not follow Auckland to the lofty heights and I doubt very much we will follow Auckland as abruptly downwards.

[couta1]

Maybe the rest of the country follows Auckland to a degree but here in Nelson we most certainly did not follow Auckland to the lofty heights and I doubt very much we will follow Auckland as abruptly downwards. Same in the Wellington region, prices very steady and lots of demand.

[Ggcc]

Matter of time - where Auckland goes, rest of country follows.

This is the first leg of a down cycle of 5 years.

If you are in Christchurch, you'd be forgiven for thinking we are in a recession!

I think a name change by the company to Summerrise rather than Summerset might help the share price though.

I can only give my opinion for Napier and have noticed house selling way too fast or offers on them before I have even seen the house. In Napier it is a sellers market. I bought my house in 2011 and feel happy I did. Not many first home buyers can afford a place in Napier anymore. Entry level is about $480,000 in an average/good suburb and the house will need some work done to it.

[trader_jackson]

Next buyer is at $5.65...
around $5.50 is where I would see 'fair value'... but not great value.
Always did find it weird why it started going back up when quarterly sales were clearly pointing in a not great direction

[Balance]

Next buyer is at $5.65...
around $5.50 is where I would see 'fair value'... but not great value.
Always did find it weird why it started going back up when quarterly sales were clearly pointing in a not great direction

One thing I must agree with is that the well managed retirement village companies are good long term investments.

I still have my MetLife but am certainly not even remotely contemplating putting any more funds into the sector until the property cycle reverses back to an uptrend.

RBNZ cutting interest rates very aggressively and talking about potentially allowing rates to become negative - which part of down trend do people not read!

[Beagle]

One thing I must agree with is that the well managed retirement village companies are good long term investments.

I still have my MetLife but am certainly not even remotely contemplating putting any more funds into the sector until the property cycle reverses back to an uptrend.

RBNZ cutting interest rates very aggressively and talking about potentially allowing rates to become negative - which part of down trend do people not read!

Yeah, its so obvious we're already in a nation wide downtrend, that's why embedded value keeps going up and is now nearly $700m ! :p http://www.sharechat.co.nz/article/23708c43/property-values-outside-auckland-reach-record-high.html?utm_medium=email&utm_campaign=Property%20values%20outside%20Aucklan d%20reach%20record%20high&utm_content=Property%20values%20outside%20Auckland %20reach%20record%20high+CID_e0c704e881706b1983242 448145c310d&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle23708c43proper ty-values-outside-auckland-reach-record-highhtml

Astute readers will have noticed that for the first time SUM has shown 3 dogs in their presentation, see page 9 of the link I provided earlier whereas their previous best was 2 dogs. That's obvious growth and progress right there :D

It should be obvious that the companies early years of super profit growth are over and we are moving towards more RYM type annual profit growth which is fine considering the company is presently priced like its a no growth company.

[Balance]

Yeah, its so obvious we're already in a nation wide downtrend, that's why embedded value keeps going up and is now nearly $700m ! :p



Reported data is historical data.

Summerset sp was $8.00 - remember?

[winner69]

Disappointed no mention of how successful or otherwise the mystery shopper initiative went ...seemed to be key to getting some sales momentum going

[Beagle]

Reported data is historical data.

Summerset sp was $8.00 - remember?

Yes I remember and sold in the high $7's and posted my reasons why on 10 October 2018.
Mid-late $5's is good investing for the long run in my opinion...but those looking for a quick buck will probably be disappointed.

[LAC]

Late to the party, just read the report. Great results and slow and steady as she goes.... plan to add during the lows

[fish]

Late to the party, just read the report. Great results and slow and steady as she goes.... plan to add during the lows

Thats the way.
I always ask myself what the shareprice be like in a few years time.There will be a range and if you believe the risk of fall is outweighed by the likely gain then buy.You also have to factor in the dividends-as long as they are higher than bank deposit rates then it is a wise decision to invest

[trader_jackson]

Very solid result. Development margin is absolutely stunning. Noted their target build rate rises to 600 units per annum over the next 2-3 years. Also noted this half's expenses include project related matters that may not be repeating.

I have raised my underlying profit estimate for the year to 31 March 2018 to $105 - $110m. This is off the back of their stunning development margin and the heavily weighted delivery of new units to the second half. At the mid point that represents underlying profit of $107.5m and 47.8 cps.

Choose whatever PE you believe in taking into account their track record of CAGR of 45% per annum in underlying profit since listing. I estimate current year growth in underlying earnings at approx. 30%. I remain with a price target of ~ $9 - $9.50 by mid 2019.

I am pleased they are treading very cautiously in Australia.

I reckon SUM people that think SUM is overpriced should have another look at their SUM's...

Funny when you look back a year ago... for example the above (posted 364 days ago) and when winner pointed out to me (around the same time) how gearing went down at 1H18 (vs 1H17)... well since then a lot has changed, for example:
- mid 2019 sum were saying we were gonna see a $9.50 share price (give or take $4 I suppose?)
- 600 unit build rate is looking ever more dangerous (given they have shown they can't actually sell the things fast enough to warrant an increase in build rate!)
- the 8 year CAGR has dropped nearly 10% (in only 1 year!)... I remember specifically saying I think this 45% or so CAGR is highly unsustainable (while others use to trumpet it from the rooftops)
- current underlying earnings growth for full year is looking to be about only a third of what sum were saying it would be
- gearing is now back up (ahead of both 1H18 and 1H17)... I reckon in a year or two CAGR Interest bearing loans and borrowings 'growth' of 28% could be higher than Underlying profit CAGR
- share price is down exactly $2 since then (364 days ago) as well
- ... and they seem to be getting keener on Aussie
in fact everything this year is almost the total opposite to this time last year eh
Maybe sum peoples sum's weren't that bad after all?

[Beagle]

Plenty of subsequent posts saying I'd revised my estimates. Thank goodness for the ignore list.

[trader_jackson]

Plenty of subsequent posts saying I'd revised my estimates. Thank goodness for the ignore list.

Regardless of the ignore list, it cannot be ignored that there must have been sum very dramatic bigly huge revisions in a pretty short period of time!
Without alot of apologies or even a 'hmm maybe that guy tj wasn't that crazy in the first place' lol

[Baa_Baa]

One thing I must agree with is that the well managed retirement village companies are good long term investments.

Certainly agree, especially when one can acquire shares at very reasonable prices, buying an income stream that will go on delivering for decades.

[couta1]

trader Jackson you do seem to have a habbit if using people's prior posts against them from time to time, I remember a couple of yrs or so ago you gathered several of mine(You must have a lot of spare time to run back through yrs of posts) and put them all together in one post and used them in a like manner, not very cool IMO. PS-People post in real time and call it as they see it at that time.

[Balance]

trader Jackson you do seem to have a habbit if using people's prior posts against them from time to time, I remember a couple of yrs or so ago you gathered several of mine(You must have a lot of spare time to run back through yrs of posts) and put them all together in one post and used them in a like manner, not very cool IMO. PS-People post in real time and call it as they see it at that time.

Easy enough to write that - yes, that was my view at that time and it has proven to be incorrect?

Unfortunately there are those who believe that they are never wrong? :D

[winner69]

Back to SUM

Book Value (ie Shareholders Funds) as at June19 is 21% higher than June18 and 8% higher than Dec18

one of best measures of company value .......so those numbers pretty impressive.....and better than others in the sector.

[trader_jackson]

Unfortunately there are those who believe that they are never wrong? :D

... and there are those who believe when they are wrong (rather spectacularly in this case) they can never own up to it or even try to admit otherwise... I had to do it with PEB, its a tough thing to do but the right thing to do
One thing is for sure, such a person would make a great politician!

But yes, back to sum

[Ggcc]

Who cares who is right or who is wrong. Look at the share price, the big money neither liked or loathed it. Back to yesterdays price shortly.

[Beagle]

Easy enough to write that - yes, that was my view at that time and it has proven to be incorrect?

Unfortunately there are those who believe that they are never wrong? :D

My view changed later that year and was very clearly articulated and I posted same immediately after I sold. It is extremely disingenuous to go back and take a selective post from one point in time, (without posting their revised view), and then go on to rub their nose in it with no other purpose than taking a childish approach.

Heathy debate yes, but, such nonsense is not something I will be engaging with any more.

[couta1]

My view changed later that year and was very clearly articulated and I posted same immediately after I sold. It is extremely disingenuous to go back and take a selective post from one point in time, (without posting their revised view), and then go on to rub their nose in it with no other purpose than taking a childish approach.

Heathy debate yes, but, such nonsense is not something I will be engaging with any more. Yes it seems Balance missed the whole message in my post.Lol

[Bjauck]

People can always change their minds on companies & it is great when they share the reasons on a forum. I would be concerned if opinions remained immutable despite developments.

It looks like the latest result indicates that SUM has been in a consolidation period. It is interesting to see that BV and underlying profit improved though. It remains a long term hold for me.

[macduffy]

... and there are those who believe when they are wrong (rather spectacularly in this case) they can never own up to it or even try to admit otherwise... I had to do it with PEB, its a tough thing to do but the right thing to do
One thing is for sure, such a person would make a great politician!

But yes, back to sum

Are you an optometrist or something, t j?

I can't read your small print asides so well - if there's anything important there I'd like an appointment, please.

;)

[Lewylewylewy]

Anyone notice the way they phrased the sold stats: "Recorded sales". Did they used to list the sales, then say that there were a bunch under contract? If that's the case, I'm ok with this, but would rather see sold + contracted.

Also, "...although the mix has changed slightly, with growing serviced apartment sales reflecting the increased emphasis on this offering over time..." this for me is a vote to put money into oca instead. (If you were thinking to buy more retirement villages).

That said, i think it's a great result in the current property market.

Disc: hold a minute parcel of sum, and no other villages. Im holding off buying more until either mid recession bargains are too enticing, or the next property boom.

[couta1]

Who cares who is right or who is wrong. Look at the share price, the big money neither liked or loathed it. Back to yesterdays price shortly. Only ones wife cares whose right or wrong and she's normally right.

[Baa_Baa]

Disc: hold a minute parcel of sum, and no other villages. Im holding off buying more until either mid recession bargains are too enticing, or the next property boom.

Holding off buying has already missed a 9%+ capital gain from the June low SP (only 5 weeks or so ago). While todays pissing contest has unfolded, the SP has shrugged off the initial 6.4c divi shed, then some, and currently up about 13c from open.

:t_up:

[Lewylewylewy]

It's not a bad stock, i just think there are better gains elsewhere.

[44wishlists]

After compared some of the basic numbers and figures in the sector, bought some more around NZT1300 today. To me, although the latest results really got no eye-popping excitement, it doesn't neither have any eye-popping disappointment as well. If looking ahead for a slight longer timeframe, its present low P/E just doesn't do the company's shareprice any justice. The current market atmospheres around the global, made companies like SUM a very reasonable choice in the sector.

Everyone has their own preferences when comes to investing. But blindly in love of a stock could result missing opportunit(ies) in others. Seems Tj just loves his ARV too much. If you're also an investor in ATM and read at threads on HC, hope you don't turn to one of the members username started with Black****, with a PhD degree.

Last, the market cap for SUM is $1319m/RYM is $6795m/ ARV is $753m

[Lease]

Given the fact property market has been soften, SUM still managed underlying profit up 6%. It's really not bad the company is worth thumb up.

I bought at $5.5 and plan to buy more if SP drop 10% or 20% from the price I purchased. Once property market turns up(may need to wait a few years), SUM sp will go to north.

[Balance]

Holding off buying has already missed a 9%+ capital gain from the June low SP (only 5 weeks or so ago). While todays pissing contest has unfolded, the SP has shrugged off the initial 6.4c divi shed, then some, and currently up about 13c from open.



Holding off buying has saved some from suffering 25% loss!

And buying ATM from the low at the beginning of the year has made some 40% + return.

Hindsight is a lovely thing, isn't it? :t_up:

[fish]

Given the fact property market has been soften, SUM still managed underlying profit up 6%. It's really not bad the company is worth thumb up.

I bought at $5.5 and plan to buy more if SP drop 10% or 20% from the price I purchased. Once property market turns up(may need to wait a few years), SUM sp will go to north.

this is not the best strategy for most investors.
We know the property market is slack.
it is difficult for us to gauge demand for retirement homes but its likely increasing
We know building costs are increasing and there is a shortage of builders.
Interest rates are low and decreasing
Spring is nearly here.
We dont know when the market will respond-but its often in anticipation

[Mudfish]

Not the stellar 1st half desired but not terrible either. Looking at past years, it seems the 2nd half should be an improvement on the first. Either way, 'nothing to see here, move along'.

[Lease]

this is not the best strategy for most investors.
We know the property market is slack.
it is difficult for us to gauge demand for retirement homes but its likely increasing
We know building costs are increasing and there is a shortage of builders.
Interest rates are low and decreasing
Spring is nearly here.
We dont know when the market will respond-but its often in anticipation

I know. Most people have no patience, and can't be tolerant on temp loss. And that's why most people can't make money:) .

As far as my experience, investing a stock can be at loss position on 90% of time, but suddenly its day arrived! And then you make money, maybe huge money. So as long as you choose sound financed, profitable, dividend paying companies, and buy when sp is dip, and then you just wait. Its day will come.

[Beagle]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12258005

[ratkin]

Where do you SUM watchers see the price going in the next few days?

Am an ex shareholder looking to get back in, and wondering how this result will be perceived in a day or Two

[Beagle]

Market has had a full day to digest the result and on the back of a very week lead from Wall Street overnight. The share price reaction speaks for itself.

[44wishlists]

Where do you SUM watchers see the price going in the next few days?

Am an ex shareholder looking to get back in, and wondering how this result will be perceived in a day or Two

Just like Beagle had pointed out earlier, if you're in for a long haul, you will do fine. But if you're looking for a quick turnaround, you will likely to be disappointed.

Disc. I bought SUM shares around NZT1300 today.

[ratkin]

Just like Beagle had pointed out earlier, if you're in for a long haul, you will do fine. But if you're looking for a quick turnaround, you will likely to be disappointed.

Disc. I bought SUM shares around NZT1300 today.

Bought a few just before the close and my inbox now filled with hundreds of trade notifications all for silly amounts like 2 shares

[winner69]

Bought a few just before the close and my inbox now filled with hundreds of trade notifications all for silly amounts like 2 shares

Happens to me sometimes ...isn’t it just plain stupid.

[limmy]

Bought a few just before the close and my inbox now filled with hundreds of trade notifications all for silly amounts like 2 shares
There must be a better way for the broking firm to notify their client(s). Yes, these multiple emails for 2 shares etc. must be annoying. I wonder why people hold or sell only 2 shares ?

[ratkin]

Happens to me sometimes ...isn’t it just plain stupid.


Consideration: 5.86Brokerage: NZD 0.00Total Cost NZD 5.86

Hundreds just like this 1 share at a time. Should be easy for them to only send the notification once a sensible amount of shares had been traded

[Baa_Baa]

Strong retirement unit sales in Auckland push up average prices for new units (https://www.stuff.co.nz/business/114955876/strong-retirement-unit-sales-in-auckland-push-up-average-prices-to-700000-at-big-village-operator)

[winner69]

Strong retirement unit sales in Auckland push up average prices for new units (https://www.stuff.co.nz/business/114955876/strong-retirement-unit-sales-in-auckland-push-up-average-prices-to-700000-at-big-village-operator)



Sold 9 LESS units and had 12 LESS resales (v pcp) but underlying earnings were UP $2.6m

That’s pretty impressive

[JeremyALD]

Looks like Ryman not too shabby afterall

[oldtech]

There must be a better way for the broking firm to notify their client(s). Yes, these multiple emails for 2 shares etc. must be annoying. I wonder why people hold or sell only 2 shares ?

I suspect it's not that people are holding just two shares, more likely that this is a result of balancing multiple different buy and sell quantities.

I am sure somebody here will know the finer points, but as an example, imagine that the next sell order in the queue is "A" selling 800 shares. "B" is looking to buy 798 shares, so the broker takes those 798 shares from "A" and sells them to "B". "A" now has just 2 shares left, and the next buy order in the queue is limmy. So you get the remaining 2 shares from "A" and then the process continues matching up people.

At least, that's how I imagine it works. And obviously the above is a very simple example; now extrapolate it to account for the thousands of people buying and selling multiple different quantities, changing their buy and sell prices as the market moves, etc.

[trader_jackson]

Forsyth speak highly of SUM... target price gone back up (from $6.60 to $7.10)
Blue sky ahead they say...
but EPS growth expected to be negative for FY19... that won't help the much touted 9 year CAGR

[winner69]

Forsyth speak highly of SUM... target price gone back up (from $6.60 to $7.10)
Blue sky ahead they say...
but EPS growth expected to be negative for FY19... that won't help the much touted 9 year CAGR

Seems a pretty reasonable target

[trader_jackson]

Seems a pretty reasonable target

Its no "$9-$9.50" or 30% EPS growth, but its a fair chunk better than yesterdays close yes.

[winner69]

Its no "$9-$9.50" or 30% EPS growth, but its a fair chunk better than yesterdays close yes.

Yes indeed, severL broker analysts had high expectations of SUM a year ago - highest target appears to have been $8.55 .....and now only $7.53

Amazing how people’s views change as the share price changes - suppose that’s human nature for you.

Off topic ....I’ve having concerns whether ARV can grow EPS with all those new shares being issued.

[Beagle]

I think they can go close to $110m underlying this year which on 225.9m shares is 48.7 cps. At $5.86 that's a forward PE of 12.

[trader_jackson]

Yes indeed, severL broker analysts had high expectations of SUM a year ago - highest target appears to have been $8.55 .....and now only $7.53

Amazing how people’s views change as the share price changes - suppose that’s human nature for you.

Off topic ....I’ve having concerns whether ARV can grow EPS with all those new shares being issued.

Forsyth were saying EPS growth was gonna be nearly 14% for ARV in FY20 (wow - that is probably the fastest growing in the entire listed sector!... if it happens), but maybe with all those extra shares issued it will only be say 8%... that's alot more growth (oh and dividend) than sum others still I suppose... you know I like to go off topic, and that is ok when my opinion matches up with other peoples opinions, but not ok when it doesn't (or when one's opinion dramatically changes and they take zero responsibility for previous statements, or acknowledge what others hand been saying)... funny that... so lets get back to um... sum! Forsyth mentioned the result was actually a bit better than they were expecting... they say EPS going to be 43.5 cps in FY19 but great growth in FY20 (of 51.7 cps)

[couta1]

It's current fair value is around $6.75 and you all know how I worked that out.

[Beagle]

It's current fair value is around $6.75 and you all know how I worked that out.

I can't help thinking of how much time and effort all the analysts could have saved themselves :)

[winner69]

Forsyth were saying EPS growth was gonna be nearly 14% for ARV in FY20 (wow - that is probably the fastest growing in the entire listed sector!... if it happens), but maybe with all those extra shares issued it will only be say 8%... that's alot more growth (oh and dividend) than sum others still I suppose... you know I like to go off topic, and that is ok when my opinion matches up with other peoples opinions, but not ok when it doesn't (or when one's opinion dramatically changes and they take zero responsibility for previous statements, or acknowledge what others hand been saying)... funny that... so lets get back to um... sum! Forsyth mentioned the result was actually a bit better than they were expecting... they say EPS going to be 43.5 cps in FY19 but great growth in FY20 (of 51.7 cps)

I think Forbar have a ‘biased’ / ‘prejudiced’ view of ARV and SUM ....talk the same lingo as you ...you are not Jeremy by any chance? ...or even worse Jeremy’s mate Nick (Nicholas)

Whatever everybody’s entitled to their own views but shouldn’t rubbish others

For what’s it worth I reckon SUM Underlying Earnings will grow by 14% this year and ARV by 6%

Pretty reasonable in these times of lowered expectations

I’m still holding both - hope to see SUM at $6.50 and ARV at $1.55 in a years time,

[bull....]

the only reason retirement stocks got a bounce was because of the RNBZ rate cut , as people are betting lower rates will re - inite the property market. time will tell if this occurs and justifies the bounce.

[winner69]

We could see SUM share price over 6 bucks today

Probably means very little for those long term holders but always nice to see other punters are keen on it as well

Jeez - at $6 that’s 12% up from recent low ...not too bad for traders either

[Beagle]

I decided not to give them the benefit of the doubt. Many thanks to Winner for graphically representing the new sales decline in post 6886. You do some very good work on here with your graphs Winner which is of very good service to all and is much appreciated. I tried my best to give them the benefit of the doubt but six quarters in a row of disappointing new sales results is not a spasmodic thing, its a trend. The fact that Summerset chose to ignore my advice to a fixed fees for life model is also a factor here as is the 50% increase in share price since December 2017 against a series of disappointing sales results.
Some accountants (including myself) believe that cash flow is the life blood of business and its worth noting that although underlying profit was up 54% last year cash flow was up just 7.8%. Finally, technically this is also looking bad. I'm out for now and will reevaluate down the track if the price corrects to be more commensurate with the current sales performance of the company.

For the record I posted this on 10 October 2018. Note the last sentence which is what I did when the share price subsequently corrected significantly. One person should get over themselves when calling others out. As Couta1 quite correctly posted yesterday, people call it as they see it at the time. The forward PE is approx. 12 and the company has a very long track record of growth and is still growing in the current market.

On the ARV thing, the devil is in the detail. The company is forecasting the acquisition will be eps accretive "assuming no change in market conditions"
Pretty obvious development margins are coming under pressure so I would say the vendor got out of those villages at a very opportune time and at a real premium price. I think Winners forecast eps growth looks about right for the two companies in post #8138 above.

[44wishlists]

ARV dividend policy is also a concern for me. Their high payout ratio means they have to borrow more, via bank loan, bond issue, capital rising to keep their growth going. You could argue it's a reasonable move in the low, and lower-ing, interest race, but to me it could end up taking more loan to just to pay dividend.

[Meister]

I am holding SUM and thinking of topping up more but a general reluctance to increase my overall market position right now has had me held back. I wonder if I should have tried to take a more active role in managing my position here given the ups and downs over the last year, probably could have wound up better off but for me this is one of those bottom drawer check it again in 10 years type of stocks.

During the last financial crisis/recession Ryman continued to grow... maybe it is a bad comparison but I think that helps show the resilience of this business model to adverse conditions; it would have to be a VERY significant housing downturn with no recovery to make Summerset a questionable long term hold. That type of downturn would affect the whole economy drastically and sink every ship, not just this one.

[mshierlaw]

I am holding SUM and thinking of topping up more but a general reluctance to increase my overall market position right now has had me held back. I wonder if I should have tried to take a more active role in managing my position here given the ups and downs over the last year, probably could have wound up better off but for me this is one of those bottom drawer check it again in 10 years type of stocks.

During the last financial crisis/recession Ryman continued to grow... maybe it is a bad comparison but I think that helps show the resilience of this business model to adverse conditions; it would have to be a VERY significant housing downturn with no recovery to make Summerset a questionable long term hold. That type of downturn would affect the whole economy drastically and sink every ship, not just this one.

I have dipped my toe in the water 3 time with SUM. Timing was not perfect (well not even very good) but every dip cost more. Patiently waiting to see my Millions but not concerned at all about holding long term.

[LAC]

I have dipped my toe in the water 3 time with SUM. Timing was not perfect (well not even very good) but every dip cost more. Patiently waiting to see my Millions but not concerned at all about holding long term.
There’s nothing to worry about in those dips, I just add a few more if I can. SUM is just a great business and those worrying about the small fluctuations in the SP are just not looking at the big picture in my opinion. Even during the slow period this business is performing well, they are bound to get the ups over the next 25years-30years, and can one imagine what those earning will look like. It’s a great business with a great management team. Unless those things change, I will accumulate over the dips so don’t stress about the short term dips is my advice. (Not that I can give any advice, DYOR;))

[mshierlaw]

There’s nothing to worry about in those dips, I just add a few more if I can. SUM is just a great business and those worrying about the small fluctuations in the SP are just not looking at the big picture in my opinion. Even during the slow period this business is performing well, they are bound to get the ups over the next 25years-30years, and can one imagine what those earning will look like. It’s a great business with a great management team. Unless those things change, I will accumulate over the dips so don’t stress about the short term dips is my advice. (Not that I can give any advice, DYOR;))

If I can dip my toe in again at less $$$ than last time then would very happy. Apart from that there is always the DRP. :)

[winner69]

Wonder if there’s an early redemption clause of those Summerset bonds ....4.78% pa until 2023 not looking like cheap finance these days ...or even the 4.2% until 2025

[RTM]

One would imagine so. Other companies will be thinking along similar lines. They owe it to their shareholders.

[Grimy]

I don't have the prospectus in front of me but I doubt it. Most bonds if they have a reset or buy back clause it is every five years or so (usually on perpetual type bonds). Short term bonds are usually fixed without a buy back clause (I may be wrong with these particular bonds, but I don't think so).
As a holder of some SUM010 bonds I hope not!
They thought it was cheap (or reasonable) finance at the time, and it was pretty clear that rates would continue to fall.
As a holder of SUM shares I am comfortable with the rate. They can refinance in 2023.
Stop trying to screw me out of the already meagre income that rate provides! :-)

[Grimy]

From the prospectus;

Neither you nor Summerset is able to redeem the Bonds before the Maturity Date.
However, Summerset may be required to repay the Bonds early if there is an Event of
Default (as described below).

[Beagle]

Wonder if there’s an early redemption clause of those Summerset bonds ....4.78% pa until 2023 not looking like cheap finance these days ...or even the 4.2% until 2025

Interestingly those 2025 bonds last traded on market at just 2.45% !

[winner69]

Interestingly those 2025 bonds last traded on market at just 2.45% !

...and the shorter duration at 2.70%

We should tell CNBC about the inverted yield curve in SUM bonds and they drum up a sensational story about the impending tough times in the NZ retirement sector ....maybe even doom times ahead

[Beagle]

Nah, enough doom and gloom already...but I do have a great "new" idea...we can invert this yield curve even further and get people to lend SUM hundreds of millions of dollars interest free for 7-10 year terms and then charge them 25% redemption fee at the end...oh hang on a minute, we do that already :)

[Beagle]

It's current fair value is around $6.75 and you all know how I worked that out.

593/1313 = ~ 45%, clawed its way back from the bottom of the channel when it was 42% relativity and heading back to 50% as sure as day follows night.

[winner69]

Tomorrow will be the day we see 6 bucks again

No worries

[Baa_Baa]

Tomorrow will be the day we see 6 bucks again

No worries

Assuming the Trumpet doesn't have some new dumb idea overnight, $6 looking good. Marketscreener 5 analysts consensus slightly up to $6.83. Forbar on record target $7.10.

As interest rates drop away and buyer enthusiasm picks up in property markets, the malaise surrounding Villages should give way to reassessing the long term value proposition and current opportunities to get a decent fill at great prices.

[trader_jackson]

Assuming the Trumpet doesn't have some new dumb idea overnight, $6 looking good. Marketscreener 5 analysts consensus slightly up to $6.83. Forbar on record target $7.10.

As interest rates drop away and buyer enthusiasm picks up in property markets, the malaise surrounding Villages should give way to reassessing the long term value proposition and current opportunities to get a decent fill at great prices.

I don't mean to blow your bubble, but you might as well ignore Forbar and their targets... they have a $1.64 target on ARV - thats 27% higher than today's share price, vs SUM where they 'only' have a 15% higher target price... you'd be nearly 2x better to invest in ARV than you would in SUM according to them

[Baa_Baa]

I don't mean to blow your bubble, but you might as well ignore Forbar and their targets... they have a $1.64 target on ARV - thats 27% higher than today's share price, vs SUM where they 'only' have a 15% higher target price... you'd be nearly 2x better to invest in ARV than you would in SUM according to them

Sorry mate, my eyesight isn’t good enough to read your fine print and I assume it’s just another cross-promo for ARV, so back on ignore. Cheers

[Ggcc]

Tomorrow will be the day we see 6 bucks again

No worries
You are quite correct. Time to open up the Moccona good stuff, with some A2 milk

[winner69]

Sorry mate, my eyesight isn’t good enough to read your fine print and I assume it’s just another cross-promo for ARV, so back on ignore. Cheers

Promotion of his own or mates work as well

[Beagle]

Sorry mate, my eyesight isn’t good enough to read your fine print and I assume it’s just another cross-promo for ARV, so back on ignore. Cheers

FWIW I gave up listening to Forbar's analysts many years ago and am also thankful for the ignore button for t.j.

[winner69]

A weekly close above 6 bucks ....cool

SUM up a solid 3.8% today ...RYM up about the same ....moving in tandem ....spooky eh possums

[Beagle]

A weekly close above 6 bucks ....cool

SUM up a solid 3.8% today ...RYM up about the same ....moving in tandem ....spooky eh possums

Looks like some good old fashioned end of month window dressing or maybe a whole sector bounce...the whole sector up at least 2% today except t.j's favourite lol. Better not tell him. 5 Year mortgages on offer for just 3.99% now. Maybe that's sparking a bit of interest in real estate which could be supportive of the sector going forward ?

[Baa_Baa]

A weekly close above 6 bucks ....cool

SUM up a solid 3.8% today ...RYM up about the same ....moving in tandem ....spooky eh possums

You called it, before it happened, then it did. Well done. The daily volatility in a boring retirement stock still confounds me but we’re well off the base now and headed in a positive direction, medium term TA resistance right around here is the next hurdle to higher capital prices.

[winner69]

Never one to work out how much I’ve made on the markets but today made a horrible discovery

My first purchases of SUM were Sept 2012 and they cost about $2 each, I remember at the time resisting the urge to sell my RBD holdings to put into this new fantastic thing called SUM ....and raided elsewhere to fund SUM

The horrible discovery .....since Sept 2012 it looks like I’ve made twice as much on the RBD shares I kept than the SUM ones I bought (think it’s 420% v 220% over 7 years)

Pretty cool eh .....fancy doing much much better over 7 years backing something selling greasy chicken and pizzas than something that’s going to creme it with the grey tsunami wanting somewhere to live.

(Just back of envelope sums but I think they’re about right)

[BlackPeter]

Never one to work out how much I’ve made on the markets but today made a horrible discovery

My first purchases of SUM were Sept 2012 and they cost about $2 each, I remember at the time resisting the urge to sell my RBD holdings to put into this new fantastic thing called SUM ....and raided elsewhere to fund SUM

The horrible discovery .....since Sept 2012 it looks like I’ve made twice as much on the RBD shares I kept than the SUM ones I bought (think it’s 420% v 220% over 7 years)

Pretty cool eh .....fancy doing much much better over 7 years backing something selling greasy chicken and pizzas than something that’s going to creme it with the grey tsunami wanting somewhere to live.

(Just back of envelope sums but I think they’re about right)

But obviously you feel much better about your ethical investment into SUM (helping old people to have a great life in retirement) than about your investment into a business which is directly contributing to our obesity epidemic - don't you?

[Ggcc]

But obviously you feel much better about your ethical investment into SUM (helping old people to have a great life in retirement) than about your investment into a business which is directly contributing to our obesity epidemic - don't you?

Obviously ethics are different in the eyes of different individuals. Some say the stock market is gambling and helping the gambling epidemic. I do want to do my best and invest in ethical stocks, but I want the best return for myself. The conundrum is real

[winner69]

But obviously you feel much better about your ethical investment into SUM (helping old people to have a great life in retirement) than about your investment into a business which is directly contributing to our obesity epidemic - don't you?

Off course ....but if you just think of them as letters on an exchange does it really matter.

I have never given Restaurant Brands any capital directly to fund their ‘unethical’ activities ...that eases my conscience a bit ....but suppose it’s not good benefiting from their activities either.

Occasionally I even think it’s not good that Summerset make so much money out of helping old people have a great life.

A couple of months ago I saw of group of oldies from a Ryman village coming out of a nearby KFC ...they seemed happy as. ...the greasy chicken helping them have a great life eh

[BlackPeter]

A couple of months ago I saw of group of oldies from a Ryman village coming out of a nearby KFC ...they seemed happy as. ...the greasy chicken helping them have a great life eh

... if this is no conflict of interest ... the greasy chicken reducing their average life span, which obviously increases (in this case) Rymans DMF income and re-sell numbers.

Ouch - I think we better change the subject, shall we?

[percy]

Ethics.
My view is changing.
Went into the chemist shop in Barrington Mall to buy a packet of Voltaren.Long and short of it, the lovely lady chemist would not sell me them.I therefore went to the local chemist in St Martins, and brought them.
Conculsion.I will never again make the mistake of going into the chemist shop in Barrington Mall.I know what I want.Therefore I would not invest in GXH as it was one of their branded stores.
Therefore the popularity of KFC means I lot of people know what they want.
Both RBD and SUM provide goods/services.If it is what people want they will do well.
As investors we also have choices.What we should not do is force our own opinions on others.

[winner69]

... if this is no conflict of interest ... the greasy chicken reducing their average life span, which obviously increases (in this case) Rymans DMF income and re-sell numbers.

Ouch - I think we better change the subject, shall we?

A nurse once told me she was amazed at the number of oldies in their last days who asked (if not demanded) for KFC ... chicken wings were popular as were the mashed spuds and gravy.

[winner69]

Ethics.
My view is changing.
Went into the chemist shop in Barrington Mall to buy a packet of Voltaren.Long and short of it, the lovely lady chemist would not sell me them.I therefore went to the local chemist in St Martins, and brought them.
Conculsion.I will never again make the mistake of going into the chemist shop in Barrington Mall.I know what I want.Therefore I would not invest in GXH as it was one of their branded stores.
Therefore the popularity of KFC means I lot of people know what they want.
Both RBD and SUM provide goods/services.If it is what people want they will do well.
As investors we also have choices.What we should not do is force our own opinions on others.

Good observations

When I go the doctor I get him to prescribe 30 of the real stuff ....like 100mg .....to have on hand for emergencies. Only $5 that way and real pills

Suppose he can track my use of them but you generally only need 1 get rid of that sore back twinge.

[BlackPeter]

Ethics.
My view is changing.
Went into the chemist shop in Barrington Mall to buy a packet of Voltaren.Long and short of it, the lovely lady chemist would not sell me them.I therefore went to the local chemist in St Martins, and brought them.
Conculsion.I will never again make the mistake of going into the chemist shop in Barrington Mall.I know what I want.Therefore I would not invest in GXH as it was one of their branded stores.
Therefore the popularity of KFC means I lot of people know what they want.
Both RBD and SUM provide goods/services.If it is what people want they will do well.
As investors we also have choices.What we should not do is force our own opinions on others.

Probably a discussion too complex to hijack the SUM thread. But in a nutshell - I do agree that we should not force opinions on others. But does this mean its ok to invest in whatever people want?

People want tobacco (and die smoking). People want weapons (and other people die from their use). People want diamonds and other people die as cheap labour providing them. People want cheap clothes and other people are basically enslaved manufacturing them. People want cheap service and quasi slaves (maids) are providing it in many countries.

But I agree - it is a very difficult subject, hard to avoid unintended consequences and hey - even the catholic church used to invest into brothels (and earlier into slave trading) ...

Lets enjoy the spoils of our investments ...

[percy]

I currently will not invest in SUM, or any other companies in the retirement sector.
Selling "licence to occupy" is OK,however it should be mandatory that the village should have to buy back any unsold unit after 6 months.

[IAK]

A nurse once told me she was amazed at the number of oldies in their last days who asked (if not demanded) for KFC ... chicken wings were popular as were the mashed spuds and gravy.
Probably help with the constipation.

[Vaygor1]

I currently will not invest in SUM, or any other companies in the retirement sector.
Selling "licence to occupy" is OK,however it should be mandatory that the village should have to buy back any unsold unit after 6 months.

One of Ryman's guarantees is they will penalise themselves if an occupier (or their estate) not paid back within 6 months.
To-date within Ryman, 6 months wait has been the longest any customer has had to wait.

Quote from Ryman's website, ref https://www.rymanhealthcare.co.nz/what-we-offer/peace-of-mind-guarantees

Repayment protection

It is standard practice for retirement villages to repay your capital sum when the unit has been on-sold. However you will want an assurance that in the event the on-sale is delayed for some reason you will be repaid.

“We guarantee that if the new resident has not settled within six months of you vacating your unit, then we will pay you interest on your occupancy advance until it is paid in full.”

This gives us an incentive to on-sell your unit and repay you promptly. Did you know that in over thirty years the longest time a Ryman resident has ever waited is six months to be repaid their occupancy advance?



Disc: Not intending to put a RYM plug into the SUM thread. I hold both, but mostly RYM.

[percy]

Thank you.
I thought Ryman too had stopped the guarantee.
However, should Ryman fail to find "a new resident" the waters remain murky.?

[peat]

Selling "licence to occupy" is OK,however it should be mandatory that the village should have to buy back any unsold unit after 6 months.

Why though?
You've bought it. It is yours to use. You are in the market long with a license to occupy - there's no reason for the village to have all the potential liability of buying back all the licenses. Yet alone the question of determining price.

At least they are going to help you sell it. And they are incentivised to do so - they don't want their village emptying out do they?

[percy]

Title.
Licence to occupy to me is like a rental.You rent it only.No ownership title.
My over 60s unit I own, and have title.I die my estate can refurbish [straight away],and market it,stage it,auction it, and just meet the market.All under 3 months.
If I was in a retirement village my estate has no rights.No title,retirement village can decide to refurbish in their own good time,and be very lazy on marketing the right to occupy.My estate could wait two years or more to be paid out,for what is or has been a retirement village's "rental property"..
It therefore is/or should be the landlord's [retirement village] responsibilityto payout any estate, should they be unable to find a new resident.How can it be an estate's responsibility.?

[justakiwi]

I totally agree with you. This is one aspect of the retirement village business I don’t like. Not for me, as I will never be in a financial position to move into one, but for those who are, it seems like they get the raw end of the deal to me.

As someone working in a rest home I struggle with the concept of retirement villages. Given the age of the residents in the rest home I work in, I think the intense focus on units is misguided. There is going to be a huge need for more rest home level, hospital level and dementia care in the future and I believe these companies should be expanding their attention into these areas of aged care much more than they currently are. But then, I guess I am looking at it from a practical point of view rather than a money making one.


Title.
Licence to occupy to me is like a rental.You rent it only.No ownership title.
My over 60s unit I own, and have title.I die my estate can refurbish [straight away],and market it,stage it,auction it, and just meet the market.All under 3 months.
If I was in a retirement village my estate has no rights.No title,retirement village can decide to refurbish in their own good time,and be very lazy on marketing the right to occupy.My estate could wait two years or more to be paid out,for what is or has been a retirement village's "rental property"..
It therefore is/or should be the landlord's [retirement village] responsibilityto payout any estate, should they be unable to find a new resident.How can it be an estate's responsibility.?

[peat]

Title.
Licence to occupy to me is like a rental.You rent it only.No ownership title.
My over 60s unit I own, and have title.I die my estate can refurbish [straight away],and market it,stage it,auction it, and just meet the market.All under 3 months.
If I was in a retirement village my estate has no rights.No title,retirement village can decide to refurbish in their own good time,and be very lazy on marketing the right to occupy.My estate could wait two years or more to be paid out,for what is or has been a retirement village's "rental property"..
It therefore is/or should be the landlord's [retirement village] responsibilityto payout any estate, should they be unable to find a new resident.How can it be an estate's responsibility.?

its got nothing to do with whether it is an estate that ends up owning it. If the person decides to move , they too would have to wait for it to sell before they would receive the funds. They would get assistance from the complex, but could drive the marketing to ensure a sale. I don't think its inequitable for the owner to hold the risk. Remember though, the village wants it full just as much. So there is a common interest!

[percy]

its got nothing to do with whether it is an estate that ends up owning it. If the person decides to move , they too would have to wait for it to sell before they would receive the funds. They would get assistance from the complex, but could drive the marketing to ensure a sale. I don't think its inequitable for the owner to hold the risk. Remember though, the village wants it full just as much. So there is a common interest!

Estate.I was trying to compare my own situation.My estate selling my over 60s unit, compared to how my estate would get on if I had a right to occupy in a retirement village.
Yes you are correct it would be the same if some one decided to move out of their right to occupy village unit.
Yes a village may want the unit re let,and there is a common interest.It is just that the fact that sometimes the village does not share the common interest very strongly.
My mother died in a retirement village in Buderim.The village owner showed no interest in either preparing her unit for sale or selling it.They then stated the market was very queit at this time, and there were a lot of other villages' units for sale.
My brother said that was interesting,however as per my mother's aggreement,they had to pay her estate out after six months if the unit remained unsold.
I see the same situation happening here .May be 5 years away may be 10 years away.May be already it is happening.ie I would think trying to sell a "leaky" "right to occupy" MET unit would be a challenge.

[Vaygor1]

Thank you.
I thought Ryman too had stopped the guarantee.
However, should Ryman fail to find "a new resident" the waters remain murky.?

Yes. A bit murky I agree... as in just what interest will Ryman pay?

There is another guarantee there on the same webpage entitled 'No Capital Loss'...

No capital loss

It will be important to you and your family that you have certainty regarding the amount you are repaid when you leave the village, and that you are not exposed to any capital loss when the unit is on-sold.

“We guarantee to repay you the balance of your occupancy advance, and that the amount repaid to you will not be affected by a decline in the value of the unit.”

So yeah, a bit untidy but at least the customer (or their estate) eventually gets back their Occupany cost less the deferred management fee with some kind of interest payment in the event Ryman should dilly-dally around. I am guessing the penalty interest rate would be specified in the fine print and agreed between the parties when signing up.

[percy]

Yes its that word EVENTUALLY that distrubes me.
My wife's 93 year old uncle died recently.Lived in the same house since 1953.
After his death the [untrained] family, declulttered the house and had it sold and paid for in under 3 months.
Also we should remember the landlord has had free use of "the right to occupy money" for years to build more units/villages.

[macduffy]

Perhaps the degree of uncertainty as to timing of payment is the offset to access to rest-home, hospital, dementia care - bearing in mind Justakiwi's point that these may be inadequate at some point - that the retirement villages provide.

[justakiwi]

The reality is, these are already inadequate. Most rest homes have waiting lists (NGO or private), there are not enough hospital level beds and don’t even get me started on dementia care facilities. I have no idea what the situation is in the North Island, but down here, I have heard of many elderly spouses and families having to travel from (say) Timaru to Dunedin, to visit their loved one in full time dementia care.

How many retirement village companies are providing rest home, hospital level and/or secure dementia care, on the same site as their villages? They need to be giving this serious thought, and sooner rather than later, as the average age of our elderly is increasing, as is the incidence of dementia. Our rest home has 30 permanent residents. Only about 3 of them are under 80 years of age. Most of them are between 85 and 102! None of them could live in an independent living situation, and 2 or 3 of them are now close to needing hospital level care or D3 dementia care.

The government will always financially support these cares, but somebody needs to provide them.


Perhaps the degree of uncertainty as to timing of payment is the offset to access to rest-home, hospital, dementia care - bearing in mind Justakiwi's point that these may be inadequate at some point - that the retirement villages provide.

[peat]

My mother died in a retirement village in Buderim. The village owner showed no interest in either preparing her unit for sale or selling it.They then stated the market was very queit at this time, and there were a lot of other villages' units for sale.

There's the problem right thurr - Straya! :p

At the end of they day its all in the contract which can be different for every operator so one needs to read it and most people should take some advice on it.

I'm surprised Ryman guarantees no capital loss. Where does that show on the books? Do Summerset do the same?

[dabsman]

The reality is, these are already inadequate. Most rest homes have waiting lists (NGO or private), there are not enough hospital level beds and don’t even get me started on dementia care facilities. I have no idea what the situation is in the North Island, but down here, I have heard of many elderly spouses and families having to travel from (say) Timaru to Dunedin, to visit their loved one in full time dementia care.

How many retirement village companies are providing rest home, hospital level and/or secure dementia care, on the same site as their villages? They need to be giving this serious thought, and sooner rather than later, as the average age of our elderly is increasing, as is the incidence of dementia. Our rest home has 30 permanent residents. Only about 3 of them are under 80 years of age. Most of them are between 85 and 102! None of them could live in an independent living situation, and 2 or 3 of them are now close to needing hospital level care or D3 dementia care.

The government will always financially support these cares, but somebody needs to provide them.

All of these comments make me feel like a lot of profit in the coming years coming my way... what an opportunity!

[justakiwi]

But only if these companies think outside the square and understand that long term, the rest home, hospital level and dementia care facilities will (in my humble opinion) be a greater “need” than independent units will be.

There are opportunities there but sadly, I can’t bring myself to invest in this area as profiting from what is a basic need for people at the end of their lives just feels wrong :(


All of these comments make me feel like a lot of profit in the coming years coming my way... what an opportunity!

[fish]

But only if these companies think outside the square and understand that long term, the rest home, hospital level and dementia care facilities will (in my humble opinion) be a greater “need” than independent units will be.

There are opportunities there but sadly, I can’t bring myself to invest in this area as profiting from what is a basic need for people at the end of their lives just feels wrong :(

Making a profit is essential for any company to survive and I feel ok about being a shareholder in a company that is improving the quality of peoples lives.There is plenty of competition and other options giving people choice.
End of life care is quite different

[Baa_Baa]

Making a profit is essential for any company to survive and I feel ok about being a shareholder in a company that is improving the quality of peoples lives.There is plenty of competition and other options giving people choice.
End of life care is quite different

Agree, best not to get hung up on the ethics of profit from care because there is actually very little profit from care, if any. These are very profitable property development companies that provide elderly housing and care services.

[justakiwi]

Sorry, when I said “at the end of their lives” I wasn’t meaning end of life as in palliative care, but rather the last decade or so of their lives. I understand that companies need to make a profit (of course) but right now it is just something I can’t bring myself to invest in. Possibly because of where I work and my day to day involvement with my residents. Down the track I might well decide differently.


Making a profit is essential for any company to survive and I feel ok about being a shareholder in a company that is improving the quality of peoples lives.There is plenty of competition and other options giving people choice.
End of life care is quite different

[dabsman]

There are opportunities there but sadly, I can’t bring myself to invest in this area as profiting from what is a basic need for people at the end of their lives just feels wrong :(

You are talking like people don't have a choice. If they don't like the deal they can go elsewhere. That is what capitalism is all about. And don't worry all companies will be pivoting to a more care centric offering and a continuum of care model. It will happen slowly as these are big ships to turn

[tipsy]

All the sellers have dried up now, not a lot of resistance. Could be good for nice little break up.

[Baa_Baa]

All the sellers have dried up now, not a lot of resistance. Could be good for nice little break up.

There is also a technical close above the 200MA yesterday and continuation today with a break-up through a major resistance trend line going back to 28/9/2018 and horizontal resistance from 23/4/2019. In due course it could backtest the breakout but next technical target is to close the gap between 6.34-6.39

:)

[dobby41]

Sorry, when I said “at the end of their lives” I wasn’t meaning end of life as in palliative care, but rather the last decade or so of their lives. I understand that companies need to make a profit (of course) but right now it is just something I can’t bring myself to invest in. Possibly because of where I work and my day to day involvement with my residents. Down the track I might well decide differently.

When my parents moved into a villa it was the best thing they did in a while.
Now that Dad has gone Mum realises that her quality of life would be so much worse if they had stayed where they were. Sure it was a house but the neighbours weren't interactive and she would now be very alone.
In the villa, in the village she has company and opportunities.
Cost - only really matters to the heirs. Fly business class, if you don't your children will.

[justakiwi]

Deleted as apparently not relevant to the current discussion.

[Baa_Baa]

RYM related but relevant to the discussion I think.

https://www.rymanhealthcare.co.nz/ryman-news/alzheimers-new-zealand-andn-ryman-healthcare-combat-dementia-stigma?utm_content=100199261&utm_medium=social&utm_source=facebook&hss_channel=fbp-531067407092784

We were talking about SUM and whether profit from care or property was ethical and reasonable. Your post about RYM and dementia care is not relevant to either imho. Maybe it’s confusing or confounding I separating investment decisions in retirement sector from personal experience working in the same sector, but as far as investing goes, this sector is very promising and has been so for a long time, and will be for a long time hence,

[Baa_Baa]

Are we enjoying the break out and the re-rate? Could only hold SUM down for so long, eventually it would be recognised for its long term future earnings potential. That time may have arrived. Got some?
😀

[winner69]

Are we enjoying the break out and the re-rate? Could only hold SUM down for so long, eventually it would be recognised for its long term future earnings potential. That time may have arrived. Got some?
��

Looking good eh baabaa

Recovered to where the share price was 18 months ago ...that’s a good start

My sign off is so appropriate for these times -

“In a roaring bull market, knowledge is superfluous and experience is a handicap.”

[Snow Leopard]

We were talking about SUM and whether profit from care or property was ethical and reasonable. Your post about RYM and dementia care is not relevant to either imho. Maybe it’s confusing or confounding I separating investment decisions in retirement sector from personal experience working in the same sector, but as far as investing goes, this sector is very promising and has been so for a long time, and will be for a long time hence,

As I can not give your negative rep until I have liked a few more posts I will say publicily that this is not a nice post.

[justakiwi]

I wasn’t going to respond to your post but I’ve changed my mind. All I want to say is this. If you display this arrogant, condescending, unsupportive attitude in your “work in the sector” I sure as hell wouldn’t be sending my mum or dad to your retirement village/rest home.


We were talking about SUM and whether profit from care or property was ethical and reasonable. Your post about RYM and dementia care is not relevant to either imho. Maybe it’s confusing or confounding I separating investment decisions in retirement sector from personal experience working in the same sector, but as far as investing goes, this sector is very promising and has been so for a long time, and will be for a long time hence,

[percy]

What Ryman and John Ryder do today, others will follow tomorrow.Always raising the bar.
Therefore I found the article very relevant.

[justakiwi]

That was exactly my thinking so glad someone "got it."


What Ryman and John Ryder do today, others will follow tomorrow.Always raising the bar.
Therefore I found the article very relevant.

[iceman]

That was exactly my thinking so glad someone "got it."

I'm sure many "got it" and share Percy's view

[justakiwi]

Thank you! And many thanks for all the supportive messages/rep votes everyone. Really appreciate that.


I'm sure many "got it" and share Percy's view

[Baa_Baa]

I wasn’t going to respond to your post but I’ve changed my mind. All I want to say is this. If you display this arrogant, condescending, unsupportive attitude in your “work in the sector” I sure as hell wouldn’t be sending my mum or dad to your retirement village/rest home.

My apologies, I should've read what I'd written before smashing it out, it was off colour and clearly others agree with you. I don't work in the sector nor do I have a retirement village, but I've spent countless hours in a hospital / dementia care ward supporting elderly loved ones and unfortunate friends.

It doesn't put me off investing in retirement villages, they are all very focused on providing the best care and from my personal observation they mostly do a great job, but that's not how these companies make their profits and returns to shareholders.

I was looking at SUM's FY18 report, if I'm not mistaken (which could be the case) I think they made a $14 million loss in operating activities on income from care fees and village services, minus payments to suppliers and employees.

[Baa_Baa]

Looking good eh baabaa

Recovered to where the share price was 18 months ago ...that’s a good start

My sign off is so appropriate for these times -

“In a roaring bull market, knowledge is superfluous and experience is a handicap.”

It's certainly encouraging to see SUM comes off a multi-month SP weakness, though more pleasing I guess if one had the opportunity to buy-in. These past few months have set me up with a nice yield and a long hold with no intention of selling.

The Weekly chart (log scale) shows the significance of this weeks breakout from the resistance trend line (now support. There's a small gap (daily) above here then a hard slog through a wide SP resistance band $6.60-6.90 which would be a re-entry to the multi-year rising price channel.

10753

[ratkin]

On the weekly, SUM has been flashing buy on any number of indicators the past couple of bars. Good thing with the weekly is Trump and his big mouth less likely to prematurely whip you out of a position.


It's certainly encouraging to see SUM comes off a multi-month SP weakness, though more pleasing I guess if one had the opportunity to buy-in. These past few months have set me up with a nice yield and a long hold with no intention of selling.

The Weekly chart (log scale) shows the significance of this weeks breakout from the resistance trend line (now support. There's a small gap (daily) above here then a hard slog through a wide SP resistance band $6.60-6.90 which would be a re-entry to the multi-year rising price channel.

10753

[justakiwi]

Apology accepted and appreciated. Thank you.


My apologies, I should've read what I'd written before smashing it out, it was off colour and clearly others agree with you. I don't work in the sector nor do I have a retirement village, but I've spent countless hours in a hospital / dementia care ward supporting elderly loved ones and unfortunate friends.

It doesn't put me off investing in retirement villages, they are all very focused on providing the best care and from my personal observation they mostly do a great job, but that's not how these companies make their profits and returns to shareholders.

I was looking at SUM's FY18 report, if I'm not mistaken (which could be the case) I think they made a $14 million loss in operating activities on income from care fees and village services, minus payments to suppliers and employees.

[tuaman]

Do you guys ever think of over-supply of retirement villages?
I noticed that these construction sites popping up everywhere and they are huge. I can see lots of new village marketing advert in local newspapers and some even have special front cover page ad. Is demand good enough? Please share your thoughts.

[ratkin]

Do you guys ever think of over-supply of retirement villages?
I noticed that these construction sites popping up everywhere and they are huge. I can see lots of new village marketing advert in local newspapers and some even have special front cover page ad. Is demand good enough? Please share your thoughts.

10754

The increase in the older old (over80s) is even more pronounced due to increasing life expectancies. should be plenty of people around to fill the retirement homes for a while yet.

[Brain]

From superseniors.msd.govt.nz

THE NUMBERS:65 plus
The number of people aged 65 and over is increasing


At the end of 2016, 711,200 people were aged 65-plus
Those aged 65 years and older will roughly double, from 711,200 in 2016 to between 1.3 and 1.5 million in 2046
Or 23 per cent of the total population, up from 12 per cent in 2016.

so is the number aged over 80


At the end of 2016, 169,000 people were aged 80+
That number is projected to climb to 392,800 by 2036
It's an increase of 132.4 per cent

and the 95-plus numbers are increasing


At the end of 2016, 5,800 people were aged 95-plus
By 2036, it's projected the number will rise to 14,500. It's an increase of 150 per cent
By 2056, the number will climb to 42,400 aged 95-plus. That's a 631% increase from 2016.

[justakiwi]

You are right about increasing life expectancies and an increase in the number of people over 80. BUT my concern is that many (if not most) of those people over 80, and certainly those in their 90s, will not be able enough to live independently (in a village unit). As I said before, most of the residents at the rest home I work in, are between 80 and 102. None of them would be able to live in a village unit. Remember too that none of our residents are hospital level care yet so not classed as "high need" but still do need a significant level of care/assistance.

If villages continue to be focused on independent living units/cottages, rather than rest home, hospital level and dementia care, I think oversupply down the track, is a good possibility.

This is just my humble opinion based on what I see in my job, conversations I have with the elderly, and a general understanding of aging related issues.

I guess it all depends on what you mean by "for a while yet."


10754

The increase in the older old (over80s) is even more pronounced due to increasing life expectancies. should be plenty of people around to fill the retirement homes for a while yet.

[Maverick]

That's an excellent question Tuaman. I see some good numbers already offered to you so here are a few more.
NZ "penetration"(the % of oldies choosing to move into a village) is about 13%, other comparable countries are 2% higher. I read a year ago that the limitation to our penetration rate is that there just aren't enough units currently available.
It has been well stated from the players that 1800 or so need to be built extra each year to match the ageing bubble.
At the OCA meeting the other week, Greg T made a comment that their own rollout rate (pipeline) is matched and can be altered to suit the demand.
Im certain all of these guys spend a lot of time modeling supply and demand before they phone up the diggers.

[percy]

I guess in a growing market, we should expect a growing amount of villages aggressively marketing their products.
That certainly appears to be happening here in Christchurch.

[BlackPeter]

You are right about increasing life expectancies and an increase in the number of people over 80. BUT my concern is that many (if not most) of those people over 80, and certainly those in their 90s, will not be able enough to live independently (in a village unit). As I said before, most of the residents at the rest home I work in, are between 80 and 102. None of them would be able to live in a village unit. Remember too that none of our residents are hospital level care yet so not classed as "high need" but still do need a significant level of care/assistance.

If villages continue to be focused on independent living units/cottages, rather than rest home, hospital level and dementia care, I think oversupply down the track, is a good possibility.

This is just my humble opinion based on what I see in my job, conversations I have with the elderly, and a general understanding of aging related issues.

I guess it all depends on what you mean by "for a while yet."

Good points supported by personal experiences - and very worthwhile discussing.

One risk with personal experiences though is that one tends to extrapolate what one sees to the areas one doesn't see - assuming all things being equal. However - maybe the population of 80 to 102 years old you are seeing is not representative for the total cohort, but specially picked due to their inability to live independently. Why else would people want to live together with other people who can't care anymore for themselves?

I think your experience is genuine, but it might not be representative ...

There are a number of aging trends:

1) Across the whole population a huge increase of the people above 80, 85, 90 (pick your number) - plenty of graphs in this thread to demonstrate that;

2) A tendency for the better educated and generally better off people in this cohort to stay for longer active and healthy (i.e. being able to live independently)

3) A tendency for the less educated (and often less well off) to need care earlier due to health problems often caused by drug and alcohol-abuse, obesity and generally less healthy lifestyle ...

I suspect what you are seeing at work is in the majority members of the latter group while the target group for independent retirement living is clearly group 2.

I am not too concerned that clients for Summerset and similar retirement villages will run out anytime soon - or to be more specific over the next 30 years or so.

Clearly around 2050 retirement villages will need to review their growth profile ...

[winner69]

BlackPeter

Clearly around 2050 retirement villages will need to review their growth profile

Supply will be over time be adjusted by the number of units that have rotten away / fallen over and not replaced

[BlackPeter]

Supply will be over time be adjusted by the number of units that have rotten away / fallen over and not replaced

This might be more relevant, though for the MET thread ;)

[Beagle]

I'm with Maverick on this one and expect the penetration rate to increase to about 15% over time, possibly even more.
Baby boomers coming through have plenty of money. OCR at 0.25% - 0.5% by mid next year will be stimulatory to the housing market.
Coutts and his wife tell me that SUM have been making some very good high level hires in the care side of their business lately. I think they are looking to significantly improve that side of their business. The good time's are coming back, no worries.

[winner69]

This might be more relevant, though for the MET thread ;)

We don’t build things to last these days ...relevant to all in sector

[justakiwi]

All good points and valid, except for this one. Many of our current residents come from farming backgrounds (both males and females), nursing/teaching, trades, banking/insurance, so not necessarily less educated. Funnily enough, our 102 year old is the fittest, healthiest and sharpest of all of them (his mother lived to 109!)

It will indeed be interesting to see how things pan out over the next 20-30 years. Healthy discussion is never a bad thing though :)


Good points supported by personal experiences - and very worthwhile discussing <SNIP>

3) A tendency for the less educated (and often less well off) to need care earlier due to health problems often caused by drug and alcohol-abuse, obesity and generally less healthy lifestyle ...

I suspect what you are seeing at work is in the majority members of the latter group while the target group for independent retirement living is clearly group 2.

[RTM]

From superseniors.msd.govt.nz

THE NUMBERS:65 plus
The number of people aged 65 and over is increasing


At the end of 2016, 711,200 people were aged 65-plus
Those aged 65 years and older will roughly double, from 711,200 in 2016 to between 1.3 and 1.5 million in 2046
Or 23 per cent of the total population, up from 12 per cent in 2016.

so is the number aged over 80


At the end of 2016, 169,000 people were aged 80+
That number is projected to climb to 392,800 by 2036
It's an increase of 132.4 per cent

and the 95-plus numbers are increasing


At the end of 2016, 5,800 people were aged 95-plus
By 2036, it's projected the number will rise to 14,500. It's an increase of 150 per cent
By 2056, the number will climb to 42,400 aged 95-plus. That's a 631% increase from 2016.



I don't think there is any question on the numbers getting old.
I do think Tuaman's question is valid from the perspective of will these folk all want to go and live in a retirement village ?
My Mum is 89 and living by herself. She has some help so she can do so. Its her preferred option.
My neighbour has built an AirBnB chalet on his property, he is going to hire a Philippino nurse and provide free accommodation for her in the Chalet when the time comes that he needs help.
Another neighbour struggled on on his big property, quite happy, and then went and spent his last days with his daughter.

There are quite a few different solutions, and lots of people will want to stay in their own dwelling if that is possible.

[BlackPeter]

I don't think there is any question on the numbers getting old.
I do think Tuaman's question is valid from the perspective of will these folk all want to go and live in a retirement village ?
My Mum is 89 and living by herself. She has some help so she can do so. Its her preferred option.
My neighbour has built an AirBnB chalet on his property, he is going to hire a Philippino nurse and provide free accommodation for her in the Chalet when the time comes that he needs help.
Another neighbour struggled on on his big property, quite happy, and then went and spent his last days with his daughter.

There are quite a few different solutions, and lots of people will want to stay in their own dwelling if that is possible.

You are right - nobody knows and there are so many possibilities.

Two observations, though ... Given the ugly rise of populism and nationalism all around the world might it be less likely that your neighbours Filipino nurse might get a visa to work ... and - while it is a great option for elderly to live with their families - they are more dispersed than ever these days, making it often impractical for the elderlies to live with their children.

In any business there are risks one must manage ... but I would think that if the biggest risk for a well run and desirable to live in retirement villages is not to find enough clients who want to live there, then the risk profile looks manageable ;):

Don't forget as well that NZ is considered internationally a quite desirable place to live. We might have to cater for more than just our own elderlies - wealthy old people from all over the world (including ExPat Kiwis and Australians who all are free to move here whenever they like) might want to buy into some of the top retirement villages in NZ. These things are happening e.g. in Switzerland, one of the preferred retirement locations for the well off's in Europe: https://www.expatfocus.com/c/aid=3956/articles/switzerland/9-reasons-you-might-want-to-retire-to-switzerland/

Have a look at the article - most of the reasons for rich people to retire in Switzerland would be true for NZ as well. Obviously - we don't have the good Swiss chocolate (Cadbury sucks ...) and yes, our public transport sucks as well. But apart from that I think we can tick the other boxes ;)

The challenges for our village providers will not be lack of interest as long as they offer well built, well managed and comfortable units in outstanding locations.

[dobby41]

I don't think there is any question on the numbers getting old.
I do think Tuaman's question is valid from the perspective of will these folk all want to go and live in a retirement village ?
My Mum is 89 and living by herself. She has some help so she can do so. Its her preferred option.
My neighbour has built an AirBnB chalet on his property, he is going to hire a Philippino nurse and provide free accommodation for her in the Chalet when the time comes that he needs help.
Another neighbour struggled on on his big property, quite happy, and then went and spent his last days with his daughter.

There are quite a few different solutions, and lots of people will want to stay in their own dwelling if that is possible.
All the old people don't have to move into retirement villages.
The villages will fill if just the same percentage of the old people as now want to move.
Makes for a large increase in the absolute numbers using villages.

[macduffy]

All the old people don't have to move into retirement villages.
The villages will fill if just the same percentage of the old people as now want to move.
Makes for a large increase in the absolute numbers using villages.

Spot on, dobby!

:t_up:

[Beagle]

Big trouble coming for Mr and Mrs Beagle if we're stupid enough to rely on our pups to look after us in our old age. I suspect there's many, many hundreds of thousands of baby boomers in the same boat...
My Mum turns 90 this month and has been very happy in her retirement village for the last decade. Most people who move into villages wish they'd done it sooner and really enjoy the sense of community and camaraderie.

[dobby41]

Big trouble coming for Mr and Mrs Beagle if we're stupid enough to rely on our pups to look after us in our old age. I suspect there's many, many hundreds of thousands of baby boomers in the same boat...
My Mum turns 90 this month and has been very happy in her retirement village for the last decade. Most people who move into villages wish they'd done it sooner and really enjoy the sense of community and camaraderie.
Not so much of an issue for Kiwis as we don't really have a history of caring for our elderly quite so directly.
Now the Chinese - there's an issue coming (or here already) as they do have a big history in generational caring - 1 couple having to look after 2 sets of parents.

[Scrunch]

Supply will be over time be adjusted by the number of units that have rotten away / fallen over and not replaced

Ongoing exterior maintenance of units is an issue that all building owners need to consider. SUM currently have a disproportionate number of their buildings that are relatively new which helps.

If well maintained buildings can last a long time, certainly past 2050. What should happen is SUM will start needing to spend progressively more on maintenance. Hopefully it goes from a very small to small expense and doesn't eat away too much of the surplus.

[Ggcc]

Big trouble coming for Mr and Mrs Beagle if we're stupid enough to rely on our pups to look after us in our old age. I suspect there's many, many hundreds of thousands of baby boomers in the same boat...
My Mum turns 90 this month and has been very happy in her retirement village for the last decade. Most people who move into villages wish they'd done it sooner and really enjoy the sense of community and camaraderie.
Most parents don’t want to feel that they are a hindrance to their children. My parents spoke negatively about retirement villages for years and have come around to realise it might be the best thing for them when the time is right (they are too young for now). Maybe when they are 80-85ish. 80 is the new 65 haha. I don’t feel that they would be a hindrance on myself or my other sibling, They need to spend their last years being happy and well looked after, which a retirement village offers for them. How they wish to spend their money is up to them, it is their money.

[winner69]

Ongoing exterior maintenance of units is an issue that all building owners need to consider. SUM currently have a disproportionate number of their buildings that are relatively new which helps.

If well maintained buildings can last a long time, certainly past 2050. What should happen is SUM will start needing to spend progressively more on maintenance. Hopefully it goes from a very small to small expense and doesn't eat away too much of the surplus.

I go past a multi story Ryman that’s not that old

Always has scaffold up somewhere and it’s obvious cladding not working (ie leaky as)

Betcha that building won’t last to 2050 ...let alone 2030 ....without heaps more being spent on it.

[Ggcc]

Not so much of an issue for Kiwis as we don't really have a history of caring for our elderly quite so directly.
Now the Chinese - there's an issue coming (or here already) as they do have a big history in generational caring - 1 couple having to look after 2 sets of parents.
With the Chinese they don’t have a health system like ours in China so they have a dependency on their children to look after them.
What they struggle to realise is that in NZ we have a health system that looks after our citizens and needs funding from our citizens to make it available for our citizens. Some, not all (Chinese) unfortunately don’t fund our system to their fullest potential, which I don’t understand, as taxes are an important part of our system. We need tax money to look after the elderly. I await my scorning, but have loads of experience with dealing with Chinese people

[dobby41]

With the Chinese they don’t have a health system like ours in China so they have a dependency on their children to look after them.
What they struggle to realise is that in NZ we have a health system that looks after our citizens and needs funding from our citizens to make it available for our citizens. Some, not all (Chinese) unfortunately don’t fund our system to their fullest potential, which I don’t understand, as taxes are an important part of our system. We need tax money to look after the elderly. I await my scorning, but have loads of experience with dealing with Chinese people

It's more than the health system.
Westerners wait til the end as offer an inheritance (a generalisation for the point) whereas Chinese pay lots for their kids to get the best start with the expectation they'll be looked after in the old age.
Just a different philosophy but has implication as their society changes - including less kids and children moving to other countries.

Point taken about the other bits - again different philosophies collide.

[ratkin]

I guess in a growing market, we should expect a growing amount of villages aggressively marketing their products.
That certainly appears to be happening here in Christchurch.

Have you seen the elderly care place in Overdale drive Percy? Massive expansion going on there, it looks bigger than most hospitals. It going Three levels high by the look of it. Some of the neighbours not too happy about it, but it going up regardless.
That one owned by Arvida group.

[ratkin]

I can see plenty of storm clouds ahead in the future, especially for the continuous care homes.
At the moment the oldies are buying up the units in all these new homes, but what happens when they all get to the needy stage at the same time, probably the time when their vacated units are not so easy to find new residents for.
The homes will be packed with 80-100 year old dribblers who are probably more of a drain on resources than the sprightly bunch currently residing in these homes.

Not a worry for the next Ten years or so, but at some stage the tailwind will turn into a force 10 headwind

[justakiwi]

Which is pretty much what I’ve been trying to say but in a much kinder and more compassionate way :(


I can see plenty of storm clouds ahead in the future, especially for the continuous care homes.
At the moment the oldies are buying up the units in all these new homes, but what happens when they all get to the needy stage at the same time, probably the time when their vacated units are not so easy to find new residents for.
The homes will be packed with 80-100 year old dribblers who are probably more of a drain on resources than the sprightly bunch currently residing in these homes.

Not a worry for the next Ten years or so, but at some stage the tailwind will turn into a force 10 headwind

[ratkin]

I was trying to think of a more appropriate word than dribblers, however since I am not far off that stage myself the brain could not summon a more suitable phrase, my apologies.

[percy]

Have you seen the elderly care place in Overdale drive Percy? Massive expansion going on there, it looks bigger than most hospitals. It going Three levels high by the look of it. Some of the neighbours not too happy about it, but it going up regardless.
That one owned by Arvida group.

Yes Rhodes on Cashmere.
We thought about there, 18 months ago.Drove past and thought they had ruined the character of the place.Did not like it.I agree with the neighbours.Looked as though you would either get morning or afternoon sun,not all day sun which I wanted.
Also Overdale Drive is rather steep,so would put me off going for walks.We walked all round that area when we lived in Crighton Tce.After looking at all the retirement villages in Spreydon,Cashmers and St Martins,,we brought an over 60s unit in Grange Street,Hillsborough.May not move from here,just get help if or when required.If we had to go into care, would move to Chatswood Rest Home in Hawford Road,which we walk past often.

[ratkin]

Yes Rhodes on Cashmere.
We thought about there, 18 months ago.Drove past and thought they had ruined the character of the place.Did not like it.I agree with the neighbours.
Also Overdale Drive is rather steep,so would put me off going for walks.We walked all round that area when we lived in Crighton Tce.After looking at all the retirement villages,we brought an over 60s unit in Grange Street,Hillsborough.May not move from here,just get help if or when required.If we had to go into care, would move to Chatswood Rest Home in Hawford Road,which we walk past often.

Agree 100% about Rhodes, looks a dreadful place tbh. Far too urban like, something about it gives me the creeps. I see quite a few of the neighbours are moving out. Number 26 is up for sale for a cool 1.8M
Overdale very unsuitable for any walking at all, would feel very trapped in a place like that. No doubt it also one of the more expensive ones.

I often go running through overdale, via that wooded lane that starts at the end of Barrington st, and that Rhodes seems to have been a construction site for at least Two years now

[percy]

Agree 100% about Rhodes, looks a dreadful place tbh. Far too urban like, something about it gives me the creeps. I see quite a few of the neighbours are moving out. Number 26 is up for sale for a cool 1.8M
Overdale very unsuitable for any walking at all, would feel very trapped in a place like that. No doubt it also one of the more expensive ones.

Nazareth House on Brougham Street was $650,000 with no privacy.Archer in Beckenham was just under $500,00 for a modest oldish unit,Rhodes I can't remember, but think it was like ARV's Park Lane [next to AMI stadium on busy Whiteleigh Ave] priced between $650,000 to $850,000.Couple on Rose Street did not appeal.Buying our over 60s for just under $500,000 ended up being a no brainer.I thought there will be plenty of nice options,but there were not.

[ratkin]

Nazareth House on Brougham Street was $650,000 with no privacy.Archer in Beckenham was just under $500,00 for a modest oldish unit,Rhodes I can't remember, but think it was like ARV's Park Lane [next to AMI stadium on busy Whiteleigh Ave] priced between $650,000 to $850,000.Couple on Rose Street did not appeal.Buying our over 60s for just under $500,000 ended up being a no brainer.I thought there will be plenty of nice options,but there were not.

That is interesting, those Archer ones in birdwood ave are a shocking price, they are nothing more than attached breeze block huts.

[percy]

That is interesting, those Archer ones in birdwood ave are a shocking price, they are nothing more than attached breeze block huts.

Agree,and again no privacy.I thought plenty to chose from,including Ryman in Beckenham.
Our $500,000 new over 60s would have been priced, at a guess at over $600,000 in a village.
And the $650,000 to $800,000 units were nice,but in places I would not live in.
ie Rhodes,Nazareth House or Park Lane.

[ratkin]

Agree,and again no privacy.I thought plenty to chose from,including Ryman in Beckenham.
Our $500,000 new over 60s would have been priced, at a guess at over $600,000 in a village.
And the $650,000 to $800,000 units were nice,but in places I would not live in.
ie Rhodes,Nazareth House or Park Lane.

I wonder if a better alternative to these villages might be to employ a a nice live in filipino nurse/helper, someone to cook and clean etc. Probably work out much cheaper too. Wonder if there are any agencies that supply them? If not there should be

[justakiwi]

So only Filipino nurse/helpers need apply, because the rest of us recognise exploitation when we see it and expect to be paid a decent wage for the quality care we provide and the genuine love and caring we have for your loved ones in our care?

This “healthy” discussion is now really pissing me off.


I wonder if a better alternative to these villages might be to employ a a nice live in filipino nurse/helper, someone to cook and clean etc. Probably work out much cheaper too. Wonder if there are any agencies that supply them? If not there should be

[ratkin]

So only Filipino nurse/helpers need apply, because the rest of us recognise exploitation when we see it and expect to be paid a decent wage for the quality care we provide and the genuine love and caring we have for your loved ones in our care?

This “healthy” discussion is now really pissing me off.

You are way too sensitive for an internet forum.

[justakiwi]

I’m not your mate and no I’m not. I’ve been hanging out and posting on Internet forums for over 30 years. All kinds of forums, not just this one. And yes, I’ve been in many a heated “discussion” in my time, but not because I’m “too sensitive.” Because I actually give a **** about people. I don’t like racists and people making judgment statements based on someone’s cultural background. And don’t tell me that’s not you because your Filipino comment says otherwise.

The fact that you have now made two inappropriate and unnecessary comments is on you. Don’t try to make it about my over-sensitivity. Your comments say much more about you than they do about me.




You are way too sensitive for an internet forum.

[winner69]

SUM share price now only 32 cents away from ‘fair value’

Mind you that could change one way or the other tomorrow.

[Baa_Baa]

SUM share price now only 32 cents away from ‘fair value’

Mind you that could change one way or the other tomorrow.

Yeah, still only 48% of RYM on the Couta theorem (all you need to know), so must be undervalued ;)
Shows how undervalued it was back in the low $5's

[winner69]

Yeah, still only 48% of RYM on the Couta theorem (all you need to know), so must be undervalued ;)
Shows how undervalued it was back in the low $5's

Good thing about Cout’s Theorem is that when the price reverts to the mean it generally/usually/ often overshoots

According 7 bucks plus is on the cards in next month or two ...maybe after third quarter sales report in early October

[Baa_Baa]

Good thing about Cout’s Theorem is that when the price reverts to the mean it generally/usually/ often overshoots

According 7 bucks plus is on the cards in next month or two ...maybe after third quarter sales report in early October

I was with you dreaming of $7 until you mentioned sales, but I guess it could all come together with these ultra low interest rates and the beginning of a rebound in property. The inverse is what sent SUM into a once in a recent lifetime buying opportunity, or maybe maybe more than once.

Still happy with a decent stash, relatively speaking and it will take more than an Armageddon to prise these from my grasp.

Slowly learning about an event horizon of 10, 20, 30 years and how that plays out with high earners in a sector with reliable strong tail winds.

Hope I live long enough to realise the upside on SUM and few others. If not, the kids will.