Here’s how Sunland Group Limited (ASX:SDG) is aiming to beat the housing bubble

It’s no secret that property prices, along with household debt, have raced higher in the last few years. This has occurred at a rate much faster than wage growth and has raised concerns that we might be in a housing bubble.

With the big banks such as Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd. (ASX: NAB) tightening their lending and others such as Bank of Queensland Limited (ASX: BOQ) hiking rates, this has led to concerns that this bubble might be about to pop.

There has also been a particular focus on the Brisbane apartment market with reports in the Australian Financial Review that some buyers of off the plan units from Lendlease Group (ASX: LLC) are now selling at a loss.

Despite this, Sunland Group Limited (ASX: SDG) is taking on the Brisbane market.

The Queensland based property development company announced that it has acquired a 3.26-hectare site in Kenmore, 11km south-west of the Brisbane CBD, for $13.1 million.

According to the announcement, the site has, “Development Approval for 96 four bedroom terraced homes with an estimated end value of $65 million”.

With a portfolio of other Brisbane properties including the Shea Residences in St Lucia which is sold out, how is Sunland aiming to beat the bubble?

Beating the bubble

The Sunland Group Managing Director said the group’s strategy is to focus on:

  • Premium sites in high growth areas
  • The owner-occupier market (as opposed to investors)
  • Areas with considerable natural and built amenities including good schools, parks and shopping centres

In other words, an area where you’d be willing to live and raise a family.

Foolish Takeaway

While the property market would not be my first investment choice (I think there are better opportunities elsewhere), I think it makes sense for companies within that industry to focus on the key growth drivers going forward.

As new households form, they will want to live in good areas and Sunland is looking to benefit from that.

4 Stocks for Building Wealth After 50

Renowned investor Scott Phillips just released a brand-new report detailing his 4 favourite stocks to buy right now.

And I don’t know about you, but I always pay attention when some of the best investors in the world give me a stock tip.

This is your chance to get in at the very beginning of what could prove to be very special investments.

Click here to get started today!

Motley Fool contributor Kevin Gandiya has no position in any of the stocks mentioned.

You can find Kevin on Twitter @KevinGandiya.

The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…


The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!