Australia's builder insolvencies to rise amid high interest rates -Jefferies

Stockland

14/05/2023 21:28

** Analysts at Jefferies expect builder insolvencies in
Australia to rise due to elevated interest rates, leading to
constraint on housing construction supply 
    ** Brokerage, still, considers integrated developers like
Mirvac Group  MGR.AX , Stockland Corp  SGP.AX  and LendLease
Group  LLC.AX  to be well-placed in high rate environment 
    ** Jefferies sees tax reduction for the build-to-rent sector
in the Australian 2023 Budget as a positive for Mirvac Group's
business
    ** Also notes changes to the Family Home Guarantee (FHG)
scheme in the Budget, like allowing people who have not owned a
property for 10 years to be eligible, with PR's and 2 people
that are not spouses or partners now also eligible 
    ** Sees the FHG changes to benefit rental companies like
Stockland Corp, LendLease Group and Mirvac Group  
    ** Jefferies expects Australia's strong supermarket sales,
with major chains winning back share lost to independents, will
be a continued tailwind for turnover rent for Charter Hall
Retail REIT  CQR.AX , HomeCo Daily Needs REIT  HDN.AX  and
Region Re  RGN.AX 
    

 (Reporting by Poonam Behura in Bengaluru)
 ((Poonam.Behura@thomsonreuters.com;))