- Excellent to see the sale of so many units, this is perhaps a sign of the times to come with the market starting to mature. Its still a ways to go but the trend of demographics with the ageing population will start becoming more and more pronounced. 785 unit sales if you think about it is more than 2 per day, and then you count the working days its a bit staggering.
- The biggest number jumping off the page is the development margin that has fallen heavily. Yes, they did target a 20-25% range but to have it at 20% flat is very interesting. Its a similar story to OCA where the delivery of units in Auckland has fallen hence such a big shift. I suspect the Auckland market, while having the most lucrative possibility of gains also has lessor demand for the units in the upper price brackets.
- Pleasing to see big gains in the fair value of property, I'm sure this is a lot to do with valuations now returning to norm post covid and the hot housing market. I would say of all the property companies, SUM has the most run rate of development in their pipeline. I guess having so much is like a switch they can tap into in terms of building. The move into Victoria is interesting, I wonder what development margins are like there. Would anyone here know?
Valuation: The underlying profit move down does make me a bit nervous. Short to medium term development margin at 20-25% to me indicates we will be here for a while, especially when you're not into the care side and can't tap into the more premium care offerings they have. You're also at the mercy of the market which has been good to SUM for a while but at 20% development margin it leaves you with not so much wiggle room if it goes the other way.
This is a stellar business, and you can't scoff at their ability to build units but at a PE 30 times their underlying profit you are really paying top dollar. I'm not sure if they can grow faster to accommodate this. I may reduce my position before the ex dividend comes up. I'm loaded up pretty heavy at a average price you might have gotten in 2017. I think there is better value elsewhere.
Appears 30% of Australians are 1 month behind on their mortgages possible same in NZ ?
Did Australia have a mortgage deferral scheme like we have (running until end of this month as far as I know). We had more than 80k households use that. From what I remember last year NZ had about 15k mortgages in arrears with late payments.
Did Australia have a mortgage deferral scheme like we have (running until end of this month as far as I know). We had more than 80k households use that. From what I remember last year NZ had about 15k mortgages in arrears with late payments.
Never thought of deferral scheme and probably the answer
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
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Originally Posted by winner69
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