Business & Investment

Real estate acquisition and bear call

62.5%.How much brokerage and mortgage inventory it is Mortgage Choice Co., Ltd. [ASX:MOC] It soared yesterday.

Why is that so?

Property portal giant REA Group Ltd [ASX:REA] We want to take it over and are ready to pay $ 1.95 per share to make it happen.

Only a few weeks ago, I considered choosing a mortgage myself.

I decided to pass it on based on recent limited growth. I never thought it might be the target of an acquisition.

Now that the news is out, it seems to be perfect for REA. They always have an army of people searching for property details on their website.

They can use this scale to send them to the established infrastructure and expertise of mortgage choices.

Thank you to those who have a mortgage option. What a great way to start the day!

These are the exact types of “flags” I’m looking for in the market.

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I don’t think it’s unreasonable to expect more M & A in multiple sectors of the market. When I say this, I think of gold and iron ore directly.

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The main reason is that both industries have incredibly strong cash flow. This gives a huge amount of money to allocate to existing producers.

One way commodity producers can continue to do business is to buy future growth.

This is not a small thing. Every day, production mines run out of existing reserves. They need to extend the life of surgery … or find something else!

There is always a risk that a company will overpay for this type of asset. But I don’t think it’s a problem in today’s market.

We are not the year of the 2007 boom. If anything, the market is currently cheap and stingy. It’s time to go shopping!

Of course, unless you take the world of Harry Dent. My companion sent me a link to a news article about him.

It quotes what he says …

Once you get this much foam, there is no way to stop it, they have to get down in reality.

It’s worth mentioning that in most countries it’s 30 to 50 percent for real estate and 60 to 90 percent for stocks in most countries.

This will kill most people’s retirement portfolio.

And there’s nothing they can do about it … I’m telling you that it will come in the next couple of years.

And I think it’s about to start next month or two months.

Is Harry Right? of course. Anything is possible. But I doubt it.

There is no reason for the real estate market to fall so sharply. The basis of property looks solid all over the world.

This can also help with careful study of market behavior. Take up the above REA.

If the market thinks it’s about to get into a tank, is management ready to pay MOC more than $ 200 million?

Remember that REA needs to swallow a river of data every day about what people are looking for, suburban and state movements, and everything else.

The data clearly tells them to grow their business to take advantage of the upcoming growth.

You just need to look out the window or your local paper. The real estate market is rising, leveraging Australia’s total wealth.

Australia’s household wealth is currently over $ 12 trillion, according to the Australian Bureau of Statistics.

That $ 7 trillion is home.

If you ask me, this is high before it goes down. I’ve never seen investors actually chase this market or see immigrants come back (and I’m sure they’ll be in time).

There will be many opportunities in the future (ask MOC shareholders!).

I hope my friend Greg Canavan will find many of them. Many of Australia’s top 200 stocks are in the real estate market.

Some real estate investment trusts (REITs) are currently raising yields as high as 6%.

Visit here for Greg’s analysis of these types of opportunities.

nice to meet you,

Calm Newman signature

Column Newman,
Editor, Daily Reckoning Australia

PS: Australian real estate expert Catherine Cashmore reveals why she thinks we’ll see the biggest real estate boom in our lives over the next five years. Click here for more information..

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