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  1. #7771
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    Quote Originally Posted by Bjauck View Post
    I think there is room for the retirement village operators to offer units for rental. There would be group of people who may not necessarily be able to afford, or perhaps want to make the outlay for an ora but who could pay rent out of retirement savings and the sale of a cheaper house.

    These renters would be probably be long-term (comparatively) and trustworthy, and a large village would have the infrastructure to administer these tenanted properties....
    Renting and purchasing are very very different propositions. Rentals are subject to vastly differing laws and regs, and more rules coming. Can of worms.

  2. #7772
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    Yes, it's a nice idea but I can't see the retirement village companies making such a drastic change to their business model. More likely, if sales slow is that development also slows and allows that big wave of retirees to catch up.

  3. #7773
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    Quote Originally Posted by macduffy View Post
    Yes, it's a nice idea but I can't see the retirement village companies making such a drastic change to their business model. More likely, if sales slow is that development also slows and allows that big wave of retirees to catch up.
    It won’t be a gentle wave it will be a tsunami. Lots of elderly will need to go to villages and in some cases the children will decide for them (in case they can’t make that choice properly for themselves). In the next 3-5 years we will see the onslaught

  4. #7774
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    Quote Originally Posted by mondograss View Post
    I guess you'd just work it that they pay a lower purchase for the ORA but a higher monthly fee. If it's a choice between that and having a unit empty for years, then yes I can see the argument being reasonably compelling. Time was that local councils had retirement units that they offered out to the low income community, but a lot have been sold off now (at least in Auckland, probably smaller provincial councils still do it).
    That would be a good compromise. I am not sure if they should take up the role of the provision of social retirement housing.

    A hybrid Ora/lease arrangement could be the way to make a retirement village affordable or more appealing to a wider market. I think the retirement villages would be well placed to meet and surpass NZ’s rental housing obligations/regime.
    Last edited by Bjauck; 07-05-2019 at 04:45 PM.

  5. #7775
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    Quote Originally Posted by Bjauck View Post
    I think there is room for the retirement village operators to offer units for rental. There would be group of people who may not necessarily be able to afford, or perhaps want to make the outlay for an ora but who could pay rent out of retirement savings and the sale of a cheaper house.

    .
    It is not the role of private rest home / aged care to provide services for those who cant afford those services. Thats why we encourage people to save for their retirement years.

  6. #7776
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    Quote Originally Posted by Bjauck View Post
    That would be a good compromise. I am not sure if they should take up the role of the provision of social retirement housing.

    A hybrid Ora/lease arrangement could be the way to make a retirement village affordable or more appealing to a wider market. I think the retirement villages would be well placed to meet and surpass NZ’s rental housing obligations/regime.
    I know a lot about rental housing in New Zealand, current and proposed rules. I would be alarmed if any company I owned shares in decided to enter that market. Check out the Residential Tenancies Act, Labour and Greens rental housing policies (and the current consultations under way), and try a sampling of the tens of thousands of Tenancy Tribunal cases every year. Almost all brought by landlords for rent arrears and damage.

    Best for the villages to stick to their knitting and leave rentals to the ever shrinking pool of landlords, and the taxpayer.

    As a general thing, I expect that those planning to buy into a retirement village will have homes at the more attractive end. Attractive to buyers, that is, because more likely to be standalone houses than say high rise studios. So most won't need a hybrid option, though their heirs might!

  7. #7777
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    Quote Originally Posted by artemis View Post
    I know a lot about rental housing in New Zealand, current and proposed rules. I would be alarmed if any company I owned shares in decided to enter that market. Check out the Residential Tenancies Act, Labour and Greens rental housing policies (and the current consultations under way), and try a sampling of the tens of thousands of Tenancy Tribunal cases every year. Almost all brought by landlords for rent arrears and damage.

    Best for the villages to stick to their knitting and leave rentals to the ever shrinking pool of landlords, and the taxpayer.

    As a general thing, I expect that those planning to buy into a retirement village will have homes at the more attractive end. Attractive to buyers, that is, because more likely to be standalone houses than say high rise studios. So most won't need a hybrid option, though their heirs might!
    Well said artemis.

  8. #7778
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    Reviewing all the economic stuff that impacts the housing market and putting them all into a matrix and assessing what usually happens to the housing market when an indicator changes I reckon we could see the number of house sales over the next year increase by more than 10% and that prices on the average could will be 5% or more higher in a years time

    Good for Summerset I reckon .......as long as Julian stirs up his sales people and doesn’t accept that non existent longer days to sell as an excuse for the sales people to finalise sales.
    Last edited by winner69; 08-05-2019 at 08:39 PM.
    ”You can't cross the sea merely by standing and staring at the water.” -Rabindranath Tagore

  9. #7779
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    Quote Originally Posted by winner69 View Post
    Good for Summerset I reckon .......as long as Julian stirs up his sales people and doesn’t accept that non existent longer days to sell as an excuse for the sales people to finalise sales.
    For sure, didn't miss the elephant in the room, but an inadequate response to arresting the multiyear declining % of sales vs total product available and longer times to sell the ones that actually got sold. I wouldn't want to be the sales manager, I bet they're having a few sleepless nights trying to figure out how to reverse the trend without manipulating other things like slowing the builds, that's just fudging the numbers. I want to see them push on with the build programme and fix their sales performance.
    BAA

  10. #7780
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    Quote Originally Posted by winner69 View Post
    Reviewing all the economic stuff that impacts the housing market and putting them all into a matrix and assessing what usually happens to the housing market when an indicator changes I reckon we could see the number of house sales over the next year increase by more than 10% and that prices on the average could will be 5% or more higher in a years time

    Good for Summerset I reckon .......as long as Julian stirs up his sales people and doesn’t accept that non existent longer days to sell as an excuse for the sales people to finalise sales.
    No argument from me

    Quote Originally Posted by Baa_Baa View Post
    For sure, didn't miss the elephant in the room, but an inadequate response to arresting the multiyear declining % of sales vs total product available and longer times to sell the ones that actually got sold. I wouldn't want to be the sales manager, I bet they're having a few sleepless nights trying to figure out how to reverse the trend without manipulating other things like slowing the builds, that's just fudging the numbers. I want to see them push on with the build programme and fix their sales performance.
    Rome wasn't built in a day. SUM's track record of profit growth speaks for itself.
    No butts, hold no mutts, (unless they're the furry variety).

  11. #7781
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    Quote Originally Posted by Beagle View Post
    No argument from me

    Rome wasn't built in a day. SUM's track record of profit growth speaks for itself.
    I know you're not making excuses for the multiyear decline in sales performance and I think I understand your motivations for backing out to the macro metrics of 'record profit growth' (I share the motivation but not the response), but even you have alluded to/acknowledged the sales performance issue.

    It is unavoidable, it is the elephant in the room with SUM. As a shareholder I'd prefer that they confronted that and shared a convincing plan to avoid a continuation of the sales under-performance. Without fudging the numbers by slowing development growth, just fix the root cause sales under-performance.
    BAA

  12. #7782
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    Quote Originally Posted by Baa_Baa View Post
    For sure, didn't miss the elephant in the room, but an inadequate response to arresting the multiyear declining % of sales vs total product available and longer times to sell the ones that actually got sold. I wouldn't want to be the sales manager, I bet they're having a few sleepless nights trying to figure out how to reverse the trend without manipulating other things like slowing the builds, that's just fudging the numbers. I want to see them push on with the build programme and fix their sales performance.
    They are doing mystery shopping to help sales along ....thats good

    But maybe thats a sign that prospective buyers turn have reasons to turn cold on Summerset and Summerset are trying to find out.
    Last edited by winner69; 08-05-2019 at 09:08 PM.
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  13. #7783
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    Quote Originally Posted by Baa_Baa View Post
    I know you're not making excuses for the multiyear decline in sales performance and I think I understand your motivations for backing out to the macro metrics of 'record profit growth' (I share the motivation but not the response), but even you have alluded to/acknowledged the sales performance issue.

    It is unavoidable, it is the elephant in the room with SUM. As a shareholder I'd prefer that they confronted that and shared a convincing plan to avoid a continuation of the sales under-performance. Without fudging the numbers by slowing development growth, just fix the root cause sales under-performance.
    Over the last two years I have been bending Julian's ear a heck of a LOT about moving to fixed weekly fee's for life. I have followed him up in a very "dogged" way.
    I gathered the sense that I might finally be getting through to him after following him up yet again about this matter last week....watch this space.
    This won't be a panacea for all the reasons some of their units are slow sellers but it will help if they finally do this.
    No butts, hold no mutts, (unless they're the furry variety).

  14. #7784
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    Quote Originally Posted by Beagle View Post
    Over the last two years I have been bending Julian's ear a heck of a LOT about moving to fixed weekly fee's for life. I have followed him up in a very "dogged" way.
    I gathered the sense that I might finally be getting through to him after following him up yet again about this matter last week....watch this space.
    This won't be a panacea for all the reasons some of their units are slow sellers but it will help if they finally do this.
    There's no doubt SUM are a successful company and should continue to be so, and there's also no doubt they know how to back land and build properties, heck they're doing an amazing job with that! I'm glad that you acknowledge albeit obliquely a sale performance issue (by not refuting it) that has been emerging for some years now. It's reported in their FY results way down the bottom in the sales table, but it's just that they don't spell out the % of sales versus units available for sale, which has declined year on year for quite some time.

    So their development programme has got well ahead of their ability to sell the properties. I think it's fudging the numbers by reducing development, as it will of course make sales look better as a % of units available for sale. I reckon if I was a Board member I'd be making life difficult by asking what they're doing about selling what they have and why should I have confidence that they can sell what's in the development pipeline, without arresting the developments which are going so well.

    Yes, I'd be all over the the sales manager like a rash and asking all sorts of awkward questions. I wouldn't immediately support a non-disclosure of developments (as they said recently "not headlining"), I'd be grinding on their sales strategy and methods and what they're doing about fixing their sales under-performance.

    If that's helped by having 'fixed fees for life', then bring it on, it's a sales motivation (at least part of), and that's what we want to see, a coherent plan to fixing sales underperformance, a sustainable pathway to unloading all the properties that are vacated and that they so capably can develop.
    BAA

  15. #7785
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    Quote Originally Posted by Baa_Baa View Post
    There's no doubt SUM are a successful company and should continue to be so, and there's also no doubt they know how to back land and build properties, heck they're doing an amazing job with that! I'm glad that you acknowledge albeit obliquely a sale performance issue (by not refuting it) that has been emerging for some years now. It's reported in their FY results way down the bottom in the sales table, but it's just that they don't spell out the % of sales versus units available for sale, which has declined year on year for quite some time.

    So their development programme has got well ahead of their ability to sell the properties. I think it's fudging the numbers by reducing development, as it will of course make sales look better as a % of units available for sale. I reckon if I was a Board member I'd be making life difficult by asking what they're doing about selling what they have and why should I have confidence that they can sell what's in the development pipeline, without arresting the developments which are going so well.

    Yes, I'd be all over the the sales manager like a rash and asking all sorts of awkward questions. I wouldn't immediately support a non-disclosure of developments (as they said recently "not headlining"), I'd be grinding on their sales strategy and methods and what they're doing about fixing their sales under-performance.

    If that's helped by having 'fixed fees for life', then bring it on, it's a sales motivation (at least part of), and that's what we want to see, a coherent plan to fixing sales underperformance, a sustainable pathway to unloading all the properties that are vacated and that they so capably can develop.
    If you keep pushing staff to increase sales in the face of a declining market then sooner or later you will suffer in some way from "innovative" methods devised by the staff that will turn and bite you later on. This has been well proven in the Australian banking industry recently and also in the USA.

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