well with the price of houses there sure will be even more greedy kids hoping for a hand up
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About time these kids got off there backsides to help themselves. I bet there parents never got a free hand out.
Thanks for the support all, I really appreciate it.
Your well articulated response Beagle is excellent. I am very happy to hear your well thought out pushback , as Chinesekiwi says , it creates a very healthy environment.
I think with my mega post and Your mega response it is time for me also to have rest for a while with plenty now on the table for readers to chew on.
I think those 2 posts give a really good summary of where OCA is at for now and what to look for in the future:
Build rates ...what actually are they going to be?
Care profit....will they improve faster over time without covid costs and possibly more agressive pricing at some stage?
Only time answer these 2 questions. Again , Beagle ,I greatly appreciate your well thought out counter concerns.
Merry Christmas posters. It's been a fabulous year and looks like next year will be even better.
And there are many young people like this, generational bashing is never helpful. Besides, how can someone blame a generation for any bad habits or traits when they themselves raised them.
The reality is a lot of people growing up today will never own a home. Me personally I don’t want one, I’d much rather build my wealth through stocks and crpyto and enjoy the freedom of being able to move about whenever I want and not participate in the madness that is the NZ property market.
Owning stocks in the retirement sector gives people who don’t have a house a perfect way of still getting exposure to it without the leverage of course (and a cheeky way of making some money back off the oldies :P).
You are right - and make some quite fair points ... If we are not happy with the generation of our children, then we are the only ones to blame ...
Discl: Quite pleased with the development of our own children, but yes, I do see some problem cases both in the younger as well as in the older generation.
Every generation blames the one before https://www.youtube.com/watch?v=5hr64MxYpgk
It feels to me like its been a very tough year. It was never going to be a good one as I knew going in that 2022 was going to be the year I lost my Mum.
I helped her and Dad choose their retirement village in 2009...we visited about 7 different villages. We knew Dad had dementia and Mum would be alone within a short space of time after moving in. Over the next decade Mum really flourished in the retirement village she was in and made a lot of friends and she was surrounded by these good friends and family in her last few days in April. One of the key reasons I am so keen on full feature retirement villages is I saw how happy my Mum was.
The lockdown in Auckland has been truly brutal on people's mental health, myself included.
During the lockdown its been tough to see this ground down from the mid 140's as recently as a few months ago to under $1.30 a little while ago. In terms of OCA it also feel like it been a tough year and I messed about with the size of my holding quite a lot until I finally found some peace with it a little while ago, thank goodness. Having started the year at $1.45 and now in the low $1.30's, that's been tough because I'm so darn hard on myself I expect every stock I own every year will be a winner. I guess with Covid I need to set more realistic expectations and focus on the long run.
I am hoping for a recovery in 2022 to at least $1.45 by December 2022, (what it closed at in December 2020) which would by then be two years prior. Surely that's not too much to expect in 2022 ? I have set my expectations at what I believe are a very modest level with the hope that I will be pleasantly surprised. As Maverick has suggested, only time will tell.
You are correct, that kids need to keep an eye on their spending habits and help themselves. I did, but also got some assistance from my parents to buy a first home, as did my sister. We were lucky that the bank of mum and dad were open for business.
They only helped us, as we had showed them we were responsible. I paid my mortgage off in 7 year, because any pay increase I got, I threw on the mortgage. Kids nowadays I have witnessed want to maintain their lifestyle, or better it if they get a pay increase. I have learned there is merit for that as well. The body is getting older and can’t do as much as when I was younger.
You can leverage up to 60% (ASB) Margin on your existing shareholding. Margin is a way to build your holding using the bank loan, for example borrow 60% of your holding on margin right before the Dividend, and pay it back after you've got the dividend or DRP, or keep the margin going if you think there's capital gain coming and the dividend funds the interest. Etc.
I had a conversation with my broker regarding his thoughts on buying more Oca. In summery said it’s not a buy even at current price because.
(1) EPS decreased due to less development margin and more importantly care costs increasing . Oca have a large weighting to care, Oca costs have gone up due to cvd and wage increases and the funding from the government has not matched the big increases in costs. So they are stuck and will get worse unless the government comes to the party.
(2) House prices have peaked and the risk is to the downside. So if this indeed does happen selling prices will be under pressure and existing valuations could fall.
(3) The secter is in a funk due to increasing interest rates and items above plus fear of Government intervention into the retirement secter.
(4) cvd is not over and what lays in store is still undetermined.
Anyway hope that helps. It’s only an opinion of one broker so bear that in mind.
Surely this depends upon your own investment plan time frames. If your a longer term investor(ten yrs or greater) and not into trying to make a quick buck, then i dont think these are of to much concern as focus is overall growth of OCA and you shouldn't be to concerned.
All sensible enough. I'm a happy long term term holder and not a buyer across the industry. If I were I'd probably buy some SUM as their business model is more fit for purpose in the current environment. Will look at how things unfold next few years and if a substantial correction maybe buy more otherwise spend me pennies elsewhere (harder said than done in this environment!)
Well, I guess all these are well known observations and assumptions which may or may not come true, however most of them are not specific to OCA. They apply to all retirement villages or probably better to all REITS.
Nothing new, i.e. the market knows about them - i.e. they are fully priced in (but obviously - everybody might put a different likelihood on opportunities and risks eventuating in the future ....
Did I mention that brokers are sometimes right and sometimes wrong ... and statistically seen there seems to be no correlation between their predictions and the actual outcome?
So - better DYOR instead of trusting a broker :) - you won't be more often right or wrong than your broker, but at least in that case its you making or losing your money, not him (or her?) ...;
Discl: holding OCA ... and expecting them to do better than some of the already fuller priced retirement villages like RYM or SUM - but hey, I am as well sometimes right and sometimes I am wrong :) ;
I understand yesterday was the last day of the calculation for the DRP price, does anyone know roughly what the price will be, either with or without the 2.5% discount. It's not super important in the big scheme of things but interested to know roughly how many shares I'll get.
I always loved this little sequence from "The Wolf of Wall Street"
Mark Hanna : Number one rule of Wall Street. Nobody - and I don't care if you're Warren Buffet or if you're Jimmy Buffet - nobody knows if a stock is going to go up, down, sideways or in circles.
- Mark Hanna : The name of the game, moving the money from the client's pocket to your pocket.
Jordan Belfort : But if you can make your clients money at the same time it's advantageous to everyone, correct?
Mark Hanna : NOOOOOOOOO!!!!!!!!!!!!
Probably a good time to reiterate that the average analyst has a 12 month price target of $1.65 https://www.marketscreener.com/quote...268/consensus/ Obviously that's taking into account all known information recently released.
Just a thought. Is the fact that about 75% of the future projects OCA are to embark upon in the future are already fully consented an asset that's undervalued on their balance sheet ?
Firstly, consider that costs for consenting of projects are rising fast https://www.stuff.co.nz/business/ind...+December+2021
and secondly that getting development consent now is getting more and more difficult as pressure groups, environmental factors, Iwi and other interested parties become ever more forceful with their objections.
Looking through the current malaise caused by Covid I suspect that the real value of the consents OCA holds over most of its future projects is not something being recognized by the market. Anything under stated NAV as at 30 September of $1.34 has to be good long term buying, surely !
Disc: Sticking with a pretty moderate stake for the foreseeable future but if people want to throw them away at under $1.30 again at some point in the future I might step up to the plate for some more.
My feelings around future projects is that until they are finished they aren't worth much! The upshot of that is we'll be golden once they are done but it requires patience.
Ask and thou shalt receive - I'm happy to get a few extra at that price.
DRP Strike Price for Interim Dividend - NZX, New Zealand’s Exchange
DIVIDEND REINVESTMENT PLAN STRIKE PRICE FOR 2022 INTERIM DIVIDEND
Oceania Healthcare Limited (OCA) advises that the strike price for the Dividend Reinvestment Plan (DRP) operating in respect of the dividend payable on 20 December 2021 has been set at NZ$1.2837 per share.
This strike price will apply in calculating the number of shares to be issued to participants who have elected to receive additional shares rather than cash.
The strike price has been determined, in accordance with the DRP, as the volume weighted average sale price in New Zealand dollars for Oceania Healthcare shares, calculated on all trades of Oceania Healthcare shares which took place through the NZX Main Board over the period of five trading days starting on 3 December 2021, less a 2.5% discount.
Shareholders who have elected to participate in the DRP will receive shares instead of cash in respect of the dividend payable on 20 December 2021.
The new shares will rank pari passu with existing shares on issue as at the date of their issue.
ENDS
Overall sales rate declining since Oct will probably affect these RV builders with staff/wage inflation headwinds just starting
https://www.interest.co.nz/property/...tions-drops-43
Disc:hold not adding
I tend to make my own decisions taking into account all views and my own research. I find that brokers and analysts are good to gain information. Like everyone though sometimes they are dead wrong as mine was with Rakon and Steel and Tube . My own broker however has got me into some serious money and opportunities, so for me he is worth his weight in gold.
Ouch that's a really sad and concerning account. https://www.nzherald.co.nz/nz/no-end...N6XNT37DLXMSY/
Makes a care suite look like a VERY attractive option.
What I see in Canterbury must be very different to other parts of NZ. Last week house prices that seemed to make even the agents gasp, no exaggeration. A couple I looked at were owners moving into RVs. Having moved here from the north I still see value but the brakes are off the price resistance that used to exist here. I do understand there is more to the sp than NTAs but given the usual lag in valuation OCA has to be a very secure investment right now.
In case some are interested:- Earl taking Metlife down the green path - something Oceania should follow - like it or hate it green is becoming a necessity to get fund managers / institutional / sharemarket support
METLIFECARE COMPLETES NEW ZEALAND’S LARGEST-EVER SUSTAINABLE RE-FINANCING WORTH NZ$1.25 BILLIO
The NZ$1.25 billion Sustainability-Linked Loan comprises NZ$600m of existing debt and $650m new debt, and makes Metlifecare the first operator in the New Zealand and Australian retirement village and aged care sector to be fully debt funded by sustainable financing. The announcement follows Metlifecare’s earlier designation of its existing listed bond into a Sustainability Bond on 26 October 2021, and marks New Zealand’s largest-ever sustainable re-financing.
The material increase in funding capacity will support key elements of Metlifecare’s Full Potential Plan: a five-year growth strategy to increase the company’s landbank and development pipeline, provide geographic diversification and expand its aged care offering, all underpinned by ambitious ESG (Environment, Social, Governance) targets.
http://nzx-prod-s7fsd7f98s.s3-websit...531/361466.pdf
Christchurch/Canterbury is blessed with literally hundreds of miles of prime flat land - and a massive leap in house building capacity in the decade post quake enabled by a willing local authority. Ample supply insured there was no boom like we saw virtually in every other NZ Metro where the opposite situation is rampant with flat land scarce and councils are fairly useless at approving higher density zoning or new green field infrastructure investment.
I don’t doubt that Christchurch is now looking very attractive to a many Auckland & Welllington first home buyers facing $800k-$1million+ prices for a basic house in those cities, as well as retirees and others looking to “cash out” there windfall equity gains and getting the same or bigger house in Christchurch for far less cost.
Really we simply need more new cities in New Zealand - most of the country is virtually uninhabited farmland. And there are to-many-to-count stretches of pristine land sitting in areas with great weather and in range of beautiful coastlines that would be perfect for new mini-cities.
I like that many of the retirement village operators are targeting exactly these sort of areas, albeit ones not too far from major centers (I guess timely access to a modern hospital is important to many retirees).
Interesting question ... and not necessarily the right thread to discuss in detail.
However - at this stage we still have a significant housing undersupply in NZ, and this despite our government having turned off both the immigration tab as well as the tab of returning Kiwis.
Question is - how will this situation change over the years to come?
(A) Our population is ageing quickly but will hang around for a long time in retirement. I.e. we will need to replace the retired workforce through immigration - hardly imaginable that we won't move back to a net migration of 50k plus per year. These people will need additional houses.
(B) More than a million Kiwis abroad who couldn't move back thanks to the MIQ disaster. Allow only 5% of them to return every year (for good) and you have another 50k people needing a place to live. Sure, some of them might be young and replacing the need for some of the new migrants from group (A), but others will return to NZ for retirement - i.e. just put additional pressure on the shrinking workforce.
(C) More than 20 million Australians free to move to NZ any day ... and watch the climate disaster to unfold in Australia much worse than in NZ with droughts, wild fires and lack of drinking water. Just 1% of Australians moving every year to NZ would be already another 200,000 migrants. We better hope it will be less otherwise we might need to work on adapting our accent .....
While I could see a situation that we might have in some parts of the country (like Queenstown) an oversupply of upmarket housing ... would I think the risk for having too many houses in NZ is for the oversee-able future close to Zilch.
Good post BP, thanks for sharing your viewpoint. Its been hot enough in Auckland lately, I don't even want to think about how hot it would be in some parts of Australia this summer. Nearly 26 million people live in Australia. Hmmm
BP, I would add to your factors for consideration -D. Wages for young people are much higher in Aus than Nz, and have been for the last 40 - 50 years. Being NZ citizens they lack access to Aus govt subsidised health and other benefits but that’s more an oldies problem. I anticipate a tipping point soon where many NZ youth will leave NZ to work in Australia when restrictions ease - or sooner.
That argument has always been there and rings some truth, youth want to travel and earn.
However most of the people entering to nz in 2019 were nz citizens by a substantial mile, followed by Chinese, Indian, South Africans, Australians and Phillipines.
This indicates heavy demand from People wanting to return.
Any young folks leaving NZ just increasing the pressure on NZ to increase immigration - given that we need the workforce - i.e. people going on OE will in no way reduce the pressure on the housing situation.
Looking at our personal situation ... 33% of our kids on OE did return this year with his family to NZ - boosting our workforce (this is good) and increase the pressure on housing :p;
The other thing is - only a very small number of job seekers is driven exclusively by the salary (and this is good so - good companies don't need people just motivated by money, they need people motivated by challenges and interesting tasks).
Most job seekers look at
- a sufficient salary to make a living (but this is as well considering the cost of living)
- an interesting task
- career opportunities
- social security
- having a job and a life as well (life / work balance)
- opportunities to enjoy the outdoors
- closeness to family / friends
Most of these issues are for Kiwis not better in Australia and some are much worse.
Not really - just ask yourself why NZ had over many years a net immigration gain - and this looking particularly at well paid professionals (like engineers, analysts, software developers, technicians) who all came from countries with higher income levels - i.e. they all took a pay-cut and swapped that for better quality of life.
I know what I am talking about - I used to be one of them :):
It is a bit like selling stuff - anybody who needs to compete based on price is screwed. The same is true for countries who only can compete for workforce by offering high salaries.
Much better to compete on quality - and in the context of competing for professionals this is to compete with offering a better quality of life instead of more money.
As indicated - NZ used to do quite well in this game, it is just the last couple of years that the Kiwi government dropped the mask and did show how little they really care about immigrants. The arrogant attitude of our anti immigration minister will be a problem for NZ over many years to come (people have long memories), but it has nothing to do with the size of our salaries.
I suppose however we are now really deviating from the thread ... if you want to continue this discussion, find an appropriate thread (or start a new one) and let us know about it.
well i thought i got out to early but i see its been hammered back down again ... 1.30 test again ?
Hammered down is't the language I'd use, chart looks nice and volume is low so a cent here and there doesn't mean much. Important to remember it's trading ex a $0.02 dividend so looks nice and healthy to me. Buying this stock under NTA was always going to be a gift.
Exactly.
I guess it is just important to understand bulls lingo. Sort of alternative facts stuff. If he says a stock is "being hammered down" (and he loves this expression) than what he really means is "hope to get some more people to sell without doing analysis to give me a still cheaper entry".
Isn't it great that he says the stock gets hammered down, is it?
I sold down part of my holding today using ASB Securities. For 30k shares, I received 47 separate e-mails for individual trades. 3 were for trades of a single share and a handful were for less than 10! Sharesies?
BHW - That's the way of the world now, in the sense that most trades on the NZX involve multiple, and usually small, fills.
BP is correct that Jarden send only one Contract Note per Order per day ( you only get more than one for an Order if you end a day with only a part fill of your Order - then the balance gets carried over to the next trading day or days until satisfied ). Even with Jarden thou you can see how many partial buys or sells made up your Order by clicking on "history " of the relevant Order ( next to the "edit" function, where you can vary your price or quantity ).
I commenced as a small holder at the last placement, but have just acquired another 19k. It has traded as high as $1.38 after going ex dividend so in my mind an entry at mid $1.30's or just under is quite reasonable given fundamentals and sector tailwinds. Much harder to start as a holder with RYM or SUM.
Hard to get a grip of these going up/going down notices
Housing crisis: Asking prices up 50 percent in just five years, homeowners making more from property than work | Newshub
Just ignore all the noise and follow the REINZ HPI data released monthly, it's a comprehensive dataset that tracks like for like house prices across every major district in the country. Ignore the mean and median, these are too noisy, even the RBNZ monitors the HPI.
So far there is zero evidence of house price falls in this data.
https://www.reinz.co.nz/Media/Defaul...ber%202021.pdf
Right now the lack of overseas migrants is helping keep house prices somewhat dampened (even though they are not showing signs of that) with reduced demand. When this loosens up, and let's hope it does because businesses are also suffering with lack of skilled workers, I'm sure we'll see the market take off furiously. Only real solution is increased supply and I have no confidence that will be sorted under the current regime
Just remind us - what did the regime before this regime do to resolve this problem? Right - absolutely nothing.
Expect the same from this regime and the regime which will come ... but hey, this is anyway for a different thread.
I am sure OCA will do well whoever holds the reigns ...
A recent article in the Herald indicated by current construction rates an over supply by 2023.
However the global supply chain for material we are informed wont unlock itself until 2024.
Lots of factors at play and for this sector surely there is going to be an increased costs of protecting inmates that could go sky high with omicron.
But wait they have probably run out of staffing resources.....
which means there systems will have to tighten up even farther to protect the inmates..
Adding to costs and detracting from the business of make big profits.
Winners posted articles of fuel addictive supply shortages in AUS going world wide shows the whole supply chain is starting to be impacted and this company is a property development company doing a lot of development.
They talked about how they're managing supply chain issues in the recent call. I took A LOT of comfort from what they had to say.
Likewise, I think HLG are highly experienced at managing these issues.
I'm not losing any sleep over this.
We sold a rental property a couple of months ago in Otara , Auckland . Spoke to the agent who sold it this week who said the market is already down 10 to 15 percent. There has been a lack of first home buyers and investors since the recent finance changes. Ok so what’s the bid deal, when the market is up 30 percent this year.? My concerns are that the Oca and others in the sector rely on unrealised property valuations which in my opinion are over inflated. Building costs are skyrocketing and then you have the threat of COVID and the implications that has. Simon bridges was handed a petition recently to look at this secter. It’s going to happen, it’s just a question of when.
So the government is not coming to the party with care costs when all the operators have increased costs with the minimum wage increase and cv19. There seems to be a lot of talk that there are a million kiwis overseas and a large number want to come home. It could also be argued that there is a large number of people who may leave NZ for greener pastures, after all the world is short of good working people. Competition for skilled workers could be a big threat for NZ.
So to sum it up I think the retirement secter in general has more of a risk to the downside. I have all four main stocks and they are a hold for me until I see some clarity. I notice that Jarden have removed Oca from thier model portfolio.
Dividend payment tomorrow, or a pile discounted shares on the DRP. :)
Huge projected growth represented by a massive premium to NTA is baked into some stocks in this sector but that's not the case with OCA which closed at $1.33, well below fair adjusted NAV as at 30 Sept 2021 (as discussed in the recent call) of $1.42
I have learned to completely ignore what one single real estate agent says, (never once met any agent that does anything other than talk their own book) and focus on what the real estate stat's are telling you, (removes all the bias and B.S.). Chatting with one veteran of the industry last week who's retiring early next year, apparently there are very close to the same number of real estate agents in N.Z. as there are listed properties for sale and most agents make a pitiful living and have very little idea of what's really happening in the market. Its the old 80/20 rule, only 20% of agents are really any good at what they do and they're the ones that make 80% of the income in the industry.
To MR B's Comments.
An Agent in a central north island town recently commented that the areas has N numbers of agents and each had only a limited number of houses to sell or lucky if they had one and some were struggling to get any as the price went higher. His clientele before COVID might be from anywhere in the world to take around in his brand new JAG. Now he was considering going back to painting portraits and picking apples.
Not all agents are moving into selling for retirement villages but perhaps that is one area of staff resourcing that this sector wont be short off.
An article from two months ago:
https://i.stuff.co.nz/national/12647...for-sale-in-nz
thanks for that.
Div/DRP comes in at price $1.2837
Capital Change Notice - NZX, New Zealand’s Exchange
Looks like a little less than half the shares were part of the DRP.
3.56 million issued at $1.2837 = $4.57m. Total divvy 706m x $0.021 = $14.8m (before tax).
Change can happen fast. Back in September, when that article was published, there were about 17,000 residential properties for sale (Trademe only but that is probably most). This week about 23,000. Includes sections but not retirement villages - they have a separate category. So only useful for trends but still that's a decent jump in 3 months.
Some of those for sale will be for folk selling to move for retirement, but quite likely plenty will be rentals on the market.
An article in Stuff today about our very own Justakiwi! Inspiring stuff well done Justakiwi! :t_up:
https://www.stuff.co.nz/business/127...lling-investor
Just a glance at NTA's and divs on the other 3 retirement companies and OCA is looking horribly unloved. From memory ARV used to pay a higher divi with some imputation. You have OCA paying over 4%? That seems out of sync.
Always good to see the top level employees participating in the DRP.
While I did not quite get ~366,000 shares I am happy with my allocation.
Typical OCA ….todays market wrap….up,up,up and one down
Retirement village operators were stronger following news aged care provider Heritage Lifecare’s private equity owner entered into a $291m sale-and-leaseback arrangement with ASX-listed Centuria Capital. Ryman Healthcare rose 1.1% to $12.20, Summerset was up 0.8% at $12.95, and Arvida increased 0.5% to $1.95. Aged care provider Oceania Healthcare declined 0.8% to $1.31
Its been a disappointing year for shareholders. Started the year at $1.45 and after theoretically promising so much potential its ended up materially underperforming the NZX50. I am holding a moderate stake, (free carry), and hoping for better things in 2022 but not expecting any huge miracles.
End of another month and another year ..... and again SUM share price seems to do better than OCA's
last 12 months OCA down 8% and SUM up 9% ....so the line on the trend heads south
The trend can't continue for ever - that would mean OCA goes to zero lol
Glad I have heaps more SUM than OCA ..... shouldn't have got sucked in by all the hype over the years and inflection points etc etc ...... but at least ahead on OCA but 'diversification' in the sector has been costly
Don't worry OCA believers - you could be right if you see the chart as 2022 is surely the year for OCA to be a star
To be fair, for most of that time OCA have been making steady progress towards transforming their old business model and with regard to brownfield developments, that's come at quite a cost. I'm hoping for a decent year for OCA in 2022 but not expecting any miracles. 2023 and 2024 should see the Oceania snowball really starting to gather momentum.
Patient puppies will get a very good feed in due course.
It seems a little strange to me that on one hand according to market screener almost all the analysts have this as a BUY with an average target price of $1.64 https://www.marketscreener.com/quote...268/consensus/
and yet on the other it got no love from any broker in the coming years share competition.
Contrasting that with HGH which attracted a lot of love (4 picks) and yet the average analyst price target is just $2.19 https://www.marketscreener.com/quote...144/consensus/ compared to the closing price for the year of $2.52.
Go figure ?
Covid ‘allegedly’ in Everil Orr
https://home.nzcity.co.nz/news/article.aspx?id=346202
Dogs of the Dow is a popular strategy. For those that don't know, you buy a bunch of the worst performers for the year of the Dow and hope they outperform the index the following year.
OCA was a real dog last year. Maybe 2022 will see it barking and outperforming the NZX50 ? If not, I think as long as one takes a "dogged" approach to holding over the next few years these should bark very nicely at some stage.
https://www.nzherald.co.nz/nz/kiwis-...VGKXYGV5HEDPQ/
Not a relative of a resident in an independent unit, not a resident in an independent unit, not a staff member either... but a resident at Everil Orr rest home which Oceania owns.
This may be a little different.
Fingers'n toes crossed this doesn't get into other residents at the rest home.