Real Estate Stocks
Hi Everyone, With the lowering of interest rates this year, what would be you best 3 - 4 stock picks in the real estate space? With thanks David
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Answer
Hi David,
The ASX real estate sector is strongly correlated to interest rates as you would imagine, the below chart illustrates it against local 3-year bonds; higher bonds = lower rates. However, it’s important to remember that this easing cycle is looking mature, the futures markets are only pricing in one more rate cut by next Christmas, a spike in inflation later this month and even that could be off the table.
- We are more likely to reduce our real estate sector than increase it into Christmas.
However, to answer your question, our preferred stocks are Mirvac (MGR), National Storage (NSR), and Centuria (CNI) which we hold across our Active Growth and Income Portfolios.
chart
ASX200 Real Estate Sector v Australian 3Year Bonds
chart
ASX200 Real Estate Sector v Australian 3Year Bonds
