Citi downgrades Australian residential REITs on housing headwinds

Mirvac

08/04/2026 22:55

** Brokerage Citi says housing market headwinds are weighing on Australia's residential-focused REITs, prompting downgrades

** Flags higher-for-longer interest rate expectations, with Citi economists now forecasting 100 bps of rate hikes in 2026, as a key drag on housing demand

** Adds potential government tax changes and slowing developer sales are likely to pressure earnings, particularly into FY27

** Citi downgrades Stockland SGP.AX and Mirvac Group MGR.AX to "neutral", saying share price declines already reflect much of the downside

** Citi prefers land lease REITs over residential near term, citing more resilient margins and demand tailwinds from an ageing population

** Rates GemLife Communities Group GLF.AX and Ingenia Communities Group INA.AX "buy"

** Downgrades Lifestyle Communities LIC.AX to "neutral" following recent share price outperformance

** S&P/ASX 200 Real Estate sub-index .AXRE down over 17% so far this year, as of last close

 (Reporting by Roushni Nair in Bengaluru)

 ((Roushni.nair@thomsonreuters.com))