Aspen Group doubles down on confidence in revenue model
The affordable accommodation operator, which delivers housing across rental, land lease and other models, said in its 3Q 2026 update that its long-term accommodation portfolio remains “essentially full”.
ASX-listed Aspen Group says its mission is to provide affordable housing options to around 40% of Australian households earning less than $90,000 a year.
Net rental income for the nine months reached $31.4 million, up 20% on the same period last year, and remains on track to meet full-year guidance of $41 million.
Development profit came in at $19.0 million, up 153% year-on-year, supported by a 105% increase in property settlements to 142 over the period.
In its third-quarter update to 31 March 2026, the Sydney-based group reported pre-tax earnings of 17.6c per security, putting it on track to achieve its 21.5c full-year guidance, which was upgraded by 7% at the half-year result in February.
Momentum this year has also led Aspen to issue FY27 pre-tax earnings guidance of 25c per security, a further 16% increase on the FY26 target, reflecting confidence in continued growth driven by housing undersupply.
“We currently hold 42 lifestyle contracts and two residential land contracts, representing 20% of our FY27 settlement target of 220,” Aspen said in the update.
“We have recently launched the next stage at Mount Barker, about 33km southeast of Adelaide, and are preparing to launch the first stage at Ravenswood, around 78km south of Perth, with the two projects delivering a combined 90 residential land lots.
“Our sale prices remain competitive, and development margins have expanded over the past 12 months, providing some buffer against a potential residential market slowdown and possible cost pressures in the construction sector linked to global factors such as the Iran conflict and higher oil prices.”
Aspen said cost risk for current projects is limited, as most are well advanced and supported by fixed-price construction contracts.
“If there is significant disruption in the building industry, the acute undersupply of affordable housing will worsen, and Aspen’s rents and prices will increase further in our opinion,” the company said.
“We expect households to continue to seek out lower-cost accommodation options that offer strong value.”
Demand for affordable housing continues to be supported by a nationwide shortage, with Aspen’s rental portfolio maintaining high occupancy and steady rental growth across both eastern and western markets.
The group said its long-term accommodation assets are largely full, with residential rents increasing by about 5% annually on average.
“We estimate our Perth residential rents are currently around 10 to 15% below market levels, while rents at CoVE Upper Mount Gravatt have been discounted by about 20% during refurbishment works,” Aspen said.
Aspen operates across living, lifestyle and holiday accommodation segments, with its CoVE brand focused on co-living in the residential market.
The update follows a strong FY25, when the group reported net rental income of $35 million, up 14%, and development profit of $12.7 million, a 47% increase.
In September 2025, Aspen acquired the Wallaroo Shores site on South Australia’s Yorke Peninsula for $14.1 million, adding capacity for 200 land lease homes.
That followed earlier acquisitions at Australind in Western Australia for $32.5 million in May 2025 and Ravenswood for $12 million.
The group also raised $74 million at $2.90 per security in May 2025 to support its acquisition strategy, alongside a $50 million increase to its debt facility, taking total capacity to $260 million. Gearing remains at 18%, with interest cover approaching six times.
