Originally Posted by
BlackPeter
That's what gets the SP down - fear.
Still unsure, though how the virus is supposed to depress the business model of any retirement village.
Their profit is linked to the property prices - and these won't be impacted in the long term, even if the virus hits us with the fullest brunt our resident scaremongers can imagine.
Just do the numbers ... say 15% of the population catch the virus (which would be pretty much worst case and consistent with the 2009 swine flu) - and roughly 1% of the infected are dying (which is consistent with the current mortality rate outside of China - and btw most of the fatalities well above retirement age). This would be 0.15% of the total population. What exactly would this do to a country with roughly 2% population growth per year (over the last decade). Right.
It might reduce a bit New Zealand's super payments, and it would increase the DMF capital return to the relevant retirement village. While obviously from a human perspective sad, it even would improve the books.
SUM might be at the moment still a bit dear, but the virus has certainly no negative impact on its (or any other retirement villages) fundamentals.
But sure - the scaremongers might make a dent in the flow of hype ... i.e. temporary share price swings are well possible.