Discover the ASX’s best income stocks for a blue-chip retirement

Don’t fall for excessively high yields, as this often means the market is expecting a dividend cut.

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The priority for many investors in the S&P ASX 200 Index (INDEXASX: XJO) is to find some secure income stocks to provide for future outgoings like holidays, the children and nice meals out. Investors should be aware that a high yield is often a sign the market expects a dividend to be cut, so be sure to look for businesses that trade on good yields with solid prospects. Otherwise you may find falls in the capital value of your investment wipe out the effects of any income received.

Solid property stocks offer some of the most reliable yields going with potential to steadily grow the capital value of your investment at the same time. Here are some of the best to consider.

Property developer and operator Mirvac Group (ASX: MGR) has particular exposure to the booming Sydney property market and growth in real estate prices across the country. Having paid out 9 cents per share in FY 2014 the group trades on a trailing yield of 4.8% selling for $1.82. Analysts forecast the dividend to steadily increase out to 2016 and likely beyond, meaning today’s investors would be getting a rock solid business with an attractive yield and strong outlook.

When selling for $7.50 Westfield Corp (ASX: WFD) offers an FX-adjusted yield of around 3.6% based on prospectus forecasts for an annual payout of 24.6 U.S. cents per share for the financial year. With its focus on developing the best shopping centres in the world’s wealthiest cities, Westfield’s newly formed international business looks a growth story as well as an attractive yield play.

The Australia and New Zealand focused arm of the Westfield Empire, Scentre Group Ltd (ASX: SCG) is another business with a fine future given its leverage to real estate values and dominant position in the domestic shopping-centre market. The dominant position of the Westfield malls means tenant demand is likely to remain extremely strong long into the future. Selling for $3.20 it offers an attractive yield around 6.25% based on forecasts for a payout around 20 cents per share this financial year.

Two others to consider are Stockland Corporation Ltd (ASX: SGP) or DEXUS Property Group (ASX: DXS), which offer yields of 5.9% and 5.1% respectively. Dexus has leverage to the office property market providing some diversification away from retail markets, while Stockland provides leverage to the growth in residential property markets. Both look solid bets with analysts forecasting dividends to be maintained or grown out to 2016.

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Motley Fool contributor Tom Richardson owns shares in Westfield Corp and Scentre Group. You can find him on Twitter @tommyr345

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