Aspen: housing situation is diabolical and opportunities are massive

ASX 300-listed Aspen Group says Australia’s worsening housing crisis is creating “massive” opportunities for its affordable accommodation platform, with development profits and earnings set to rise strongly over the next year.

The group told investors its development business is expected to realise profit of at least $19.5 million in FY26, equating to a return on invested capital of around 20%.

“We expect realised development profits and net asset value to increase materially over the medium term as we take full advantage of our low-cost pipeline of over 2,500 potential sites,” Aspen Group’s Head of Asset Management and Development, Patrick Maddern, told the AGM last Thursday, 20 November.

“Aspen is well on track to achieve its recently upgraded FY26 underlying pre-tax EPS guidance of 20.1 cents, up 20% on its strong FY25 result.”

Aspen delivers affordable accommodation under three funding models:

• Residential Living – Aspen owns the dwelling and land, which is leased to customers
• Lifestyle land lease – Aspen owns the land, which is leased to customers who own their dwelling
• Residential land lots – Aspen sells developed land lots to customers who own both dwelling and land (typically with bank finance)

Patrick said the nation’s affordable housing crisis is deepening rapidly.

“The proportion of listed rentals offered at less than $400 a week has collapsed to 8% Australia-wide and under 5% in Aspen’s major markets – a small fraction of the 40% of households who need it,” he said.

“To address the shortfall, and to accommodate expected population growth of 1.8 million over the next five years, production needs to jump 40% to a record 1.2 million new dwellings, costing roughly $1 trillion. The situation is diabolical and the opportunities are massive.

“Over the past five years Aspen has tripled its portfolio of quality affordable accommodation to over 6,500 dwellings and sites. About 4,000 are in the rental pool with an average weekly gross rent of only $325 per dwelling or site.”

Aspen’s longer-stay rentals are “essentially full” and rents are rising across its models.

“We are seeking much higher rents this year for our short-stay rentals that are aimed at corporates and discretionary tourism, after substantially upgrading the properties over the past few years. This is proving more profitable to date despite some softening in occupancy at some properties,” Patrick said.

Development sales are also accelerating. In the 12 months to October 2025, Aspen generated 179 sales contracts – 91 of those in the last four months alone.

Sales are skewing to Lifestyle houses, which generate roughly twice the profit of its Residential land lots.