Property Stocks

[Aaron]

Thanks everyone for your responses. I think I'll go with PFI which was my first thought, and KPG. Snoopy you may be right that none are perfectly priced right now, but I'm thinking about what is being said about central banks likely giving up on controlling inflation and the need to be in hard assets. Not that I'm a wholesale portfolio rearranger, or even a fiddler, just for new stuff.

Bit late for that one. They gave up controlling inflation when they broke away from the gold standard as a gold standard imposed constraints on governments.

NZ pushed it further 30 odd years ago by mandating inflation as part of the RBNZs job. The CPI inflation is not closely linked to asset price inflation. But you are right, I have read that govts won't repay their debts, or default on them, so inflation is their only other option. Adrian will be inwardly loving the 4% rate we have now.

No recommendation on property companies but read this article and thought it might be relevant. Only sentiment, though and it does not say who was surveyed.

https://www.interest.co.nz/property/...a-pacific-only

You could try the scatter gun approach and buy a bit of each. If you really believed that central banks will destroy their currencies through inflation/money printing/interest rate suppression then why not borrow against the house to buy already leveraged property companies. If the economic pundits are correct about inflation you should win in the long run as long as they have enough tenants and are not over leveraged themselves.

[Nor]

Hello Aaron
I remember in the early sixties my parents rented a 3 bdr house in a working class suburb of Wellington for £6 a week, $12. Later in the 70s as a student we had a 3 bdr central Wellington flat for $24. And at intermediate you could get 3 milkshake ice blocks for a shilling, 10 cents. These are my inflation measuring sticks. So I think that even if inflation may be bad for property companies in the short-term, long-term they must be a good investment. I'll look at your link.

[Joshuatree]

Slight shift but I've been watching Aus Reits with no franking credits,( that's good),some very good yields and share prices at bigger discounts to nta .

[Nor]

Slight shift but I've been watching Aus Reits with no franking credits,( that's good),some very good yields and share prices at bigger discounts to nta .

Would these be FIF exempt? If I had to put money on it I would guess not. But who knows.

[Aaron]

Hello Aaron
I remember in the early sixties my parents rented a 3 bdr house in a working class suburb of Wellington for £6 a week, $12. Later in the 70s as a student we had a 3 bdr central Wellington flat for $24. And at intermediate you could get 3 milkshake ice blocks for a shilling, 10 cents. These are my inflation measuring sticks. So I think that even if inflation may be bad for property companies in the short-term, long-term they must be a good investment. I'll look at your link.

At a guess you are at least in your 60s or 70s so take my high debt, high risk inflation strategy with a grain of salt. I am not following my own advice at this stage.

I thought as you got older you are supposed to increase your fixed interest and reduced your equity exposure, in case of market crashes. I guess if March 2020 was a market crash we are in the middle of one now as a few companies are nearly back at their March 2020 lows although the drop has been less precipitous than 2020.

Hard knowing how to invest as we ponder what central banks will do, but per your inflation measuring stick cash is trash, Ray Dalio's long term debt cycle might mean we have more years of rising rates, who knows, I would not have a clue.

[troyvdh]

Im probably wrong..but a really really wealthy bloke said to me once he loved high inflation because it killed debt.........and that was the best time to borrow the stuff.

[Valuegrowth]

Im probably wrong..but a really really wealthy bloke said to me once he loved high inflation because it killed debt.........and that was the best time to borrow the stuff.

I have seen how experienced investors borrowed funds to increase their wealth during inflation. Similarly, there are investors who lost everything. Simply, those who manage well will do well. Those who failed in property development and property investment didn’t’ have a proper risk management. Either they over expanded, couldn’t identify the trend, and invested at the wrong time. I believe in cycles. These cycles create opportunity for intelligent investors.

[Bev73]

Sride provides its own in house management team. It also has the management contract for Investore. Does anyone know which of the other property companies have in house management.

I was wondering whether, or not, it can be shown that in house teams produce better results over time.

[Snoopy]

Stride provides its own in house management team. It also has the management contract for Investore. Does anyone know which of the other property companies have in house management.

I was wondering whether, or not, it can be shown that in house teams produce better results over time.

I did a bit of work on this issue over 2022 and 2023 here in the 'Dogs vs Hyenas' series here:
https://www.sharetrader.co.nz/showth...=1#post1013892

And in 2022 in the six part 'Toffs into Offs' series starting here:
https://www.sharetrader.co.nz/showth...l=1#post947782

SNOOPY

[Nor]

Precinct went over to in house management a few years ago I seem to remember.