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14-10-2021, 11:59 AM
#10321
At last. Someone gets it.
Originally Posted by couta1
Just think of this stock as an essential service.
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14-10-2021, 12:03 PM
#10322
Originally Posted by couta1
Just think of this stock as an essential service.
Problem with essential services is that they tend to be most on the Govt watch list for control and directives which can translate shareholder's wealth into vote banks for them . Aged people is big group to be pampered or made promises . Capital sharing can be most fair sounding directive possible ahead ....
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14-10-2021, 12:16 PM
#10323
Maybe, but you have to remember two things. Firstly the government pays these providers a lot of money for the care of residents who qualify for subsidized care.
Secondly, the government needs these providers.All of them. There is no way the government can provide this service themselves as part of the public health system. They are 100% dependent/reliant on these providers to meet the growing need for aged care - villas, serviced/unserviced apartments, care beds, hospital care beds, and dementia care. The need for all of these services is going to continue to grow substantially. Forever.
Which means the government has to be very careful in terms of forcing any "requirements" onto providers. If they push them to far, providers will be forced to increase fees significantly (including the fee for subsidized care), and /or reduce their care services (as they are the least profitable side of the business).
The government simply can't afford to let that happen.
Originally Posted by alokdhir
Problem with essential services is that they tend to be most on the Govt watch list for control and directives which can translate shareholder's wealth into vote banks for them . Aged people is big group to be pampered or made promises . Capital sharing can be most fair sounding directive possible ahead ....
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14-10-2021, 12:20 PM
#10324
Originally Posted by alokdhir
Problem with essential services is that they tend to be most on the Govt watch list for control and directives which can translate shareholder's wealth into vote banks for them . Aged people is big group to be pampered or made promises . Capital sharing can be most fair sounding directive possible ahead ....
The largest majority of these elderly folks don't want to have to worry about maintenance costs whilst living in their units or arranging stuff to be fixed, they also don't wont uncertain weekly fees which keep increasing, you can't have it both ways.
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14-10-2021, 12:25 PM
#10325
----
"Prediction is very difficult, especially about the future" (Niels Bohr)
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14-10-2021, 01:30 PM
#10326
Junior Member
Originally Posted by couta1
The largest majority of these elderly folks don't want to have to worry about maintenance costs whilst living in their units or arranging stuff to be fixed, they also don't wont uncertain weekly fees which keep increasing, you can't have it both ways.
Agreed, some privately owned retirement village offered commitment to never increase weekly fees for the entire occupation period. Makes sense cos the money is not really in the fees but the sale of units. Give a bit of carrot to incentivise sign-ups I suppose.
While I'm nowhere near the retirement age so I may not fully appreciate the lifestyle offered by these villages, but throughout the different villages that I came across, it is not hard to foresee that for many years to come, the demand for these units will continue to trend upwards which makes the sector very investable.
Last edited by dameofdiv; 14-10-2021 at 01:46 PM.
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14-10-2021, 01:50 PM
#10327
Member
Originally Posted by justakiwi
Maybe, but you have to remember two things. Firstly the government pays these providers a lot of money for the care of residents who qualify for subsidized care.
Secondly, the government needs these providers.All of them. There is no way the government can provide this service themselves as part of the public health system. They are 100% dependent/reliant on these providers to meet the growing need for aged care - villas, serviced/unserviced apartments, care beds, hospital care beds, and dementia care. The need for all of these services is going to continue to grow substantially. Forever.
Which means the government has to be very careful in terms of forcing any "requirements" onto providers. If they push them to far, providers will be forced to increase fees significantly (including the fee for subsidized care), and /or reduce their care services (as they are the least profitable side of the business).
The government simply can't afford to let that happen.
100% Justakiwi, emergency departments and hospitals are already stretched… just imagine how hospitals would cope with a wave of 85 year olds needing hospital level care urgently, they wouldn’t be able to cope in my opinion.
Last edited by Joh13; 14-10-2021 at 01:56 PM.
Reason: Edit
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14-10-2021, 02:05 PM
#10328
Originally Posted by Joh13
100% Justakiwi, emergency departments and hospitals are already stretched… just imagine how hospitals would cope with a wave of 85 year olds needing hospital level care urgently, they wouldn’t be able to cope in my opinion.
never fear the govt has it covered you just have to use your telehealth app ( hope it works ) from the comfort of your place of abode. ambulance will arrive sometime in the future if its urgent
one step ahead of the herd
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14-10-2021, 03:14 PM
#10329
I’ve been saying there is regulatory risk for sometime. It’s one of the reasons that my holding in this sector has halved. COVID-19 Delta getting away in Auckland may reduce that risk. As in the same way COVID assisted Labour in the last election, it might well work against them in the next one,
IMO and FWIW.
Originally Posted by Beagle
You've identified the key risk nobody wants to talk about. Spindy and her woke kindergarten cops saying its not fair and all those poor old people have been duped. We have seen from her radical upheaval of the laws pertaining to interest deducibility nothing is off limits when its comes to punishing so called evil capitalists who are perceived to be afflicting the little people.
^^^^^ This - Must read for newbies.
Some excellent reading in there for anyone wanting to get up to speed on this sector.
Also some stuff in here pertaining to Oceania itself https://www.oceaniahealthcare.co.nz/
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14-10-2021, 03:35 PM
#10330
Originally Posted by RTM
I’ve been saying there is regulatory risk for sometime. It’s one of the reasons that my holding in this sector has halved. COVID-19 Delta getting away in Auckland may reduce that risk. As in the same way COVID assisted Labour in the last election, it might well work against them in the next one,
IMO and FWIW.
If the current ORA terms were made illegal, I wonder how much less profitable for developers and shareholders would the replacement be? How much extra risk would the residents moving into the villages be expected to shoulder? How much less security of tenure would the residents be expected to suffer?
If the replacement for current ORAs resulted in less profit for developers/retirement village companies then fewer units may be built and fewer care beds supplied as the result of less cross-subsidy from ORA profits. So more retired people may end up staying in their family sized homes, reducing the supply for younger home owners with young families, exacerbating the housing shortage? Also the government may need to find extra beds for the increasing demand from baby boomers for rest home and hospital level care.
At the moment, many of the homeowners buying (of their own free will with independent legal advice) an ORA pocket part of the untaxed capital gain derived from owning their house, while in effect transferring another part of this untaxed capital gain to the owners of the retirement village. How keen would any government be in taking up this cause?
Last edited by Bjauck; 14-10-2021 at 03:43 PM.
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