With talk of inflation easing and more rate cuts on the way, it could be a good time to invest in ASX real estate shares.
Let's look at two top ASX property shares:
Goodman Group (ASX: GMG)
Goodman Group is an integrated property group with operations in 14 countries across North America, Europe, China, Japan, and Australia.
It specialises in industrial and commercial properties, with a global portfolio worth around $80 billion.
Goodman Group shares are currently trading at around $27.82, having shed about 22% of their value so far this year.
And a look over the company's latest half-year results offers more reason to consider Goodman Group as a top investment in the ASX real estate space.
Goodman Group reported an operating profit of about $1.2 billion for the first half of FY25, up 8% on the prior corresponding period.
And despite its recent $4 billion equity raising, the company's earnings per share (EPS) guidance is set to grow at 9% for FY25.
Further, while Goodman Group's total portfolio was valued at $84.4 billion as of 31 December 2024, its market cap currently sits at around $56.6 billion.
As such, I see clear value in Goodman and now could be a great time to buy shares in the property giant.
And I'm not the only one.
Broker Bell Potter recently raised its rating on Goodman Group to overweight with a price target of $37.75 per share.
That price target implies an upside of about 35% based on its current value.
In terms of potential risks for Goodman Group, the broker stated:
Management pointed out that the market remains volatile due to economic uncertainties globally, particularly in Europe. They recognize the risks associated with operating in a high-interest-rate environment and the necessity to manage capital efficiently.
Scentre Group Ltd (ASX: SCG)
With a market cap of about $18 billion, Scentre is another major player in the ASX real estate space.
Scentre owns 42 Westfield shopping centres throughout Australia and New Zealand and has plans to increase its residential footprint.
The company recently announced it received rezoning approval for sites in Sydney and Canberra, which opens the door for large-scale residential development opportunities at those sites.
The Scentre share price is down about 1% so far this year, with shares in the company currently changing hands for $3.40 each.
Bell Potter sees significant upside in Scentre shares with a price target of $3.74.
The broker stated:
Scentre Group demonstrated robust financial performance and growth prospects amid rising demand for their retail spaces. Strategic partnerships and residential developments are expected to further enhance opportunities.
