It was June 27 last year that Fairfax/4 Corners executed its devastating investigation into the retirement village sector, focusing on Aveo but actually targeting the underlying business model and contract.
That is 44 weeks ago.
You can see the immediate impact of the traffic to our retirement living portal villages.com.au above. First, there was the spike in visits and then a prolonged 10% drop off in traffic.
Sales were hit. By January Lendlease reported a 28% drop in sales for the six months, Aveo 24% and Stockland 16%. Across these three they missed targets by approximately by 395 home sales.
Using $350,000 as the average value of a retirement village home and a 30% DMF, across the three operators they lost $41,475,000 in net DMF income.
Add to this the 600 other village operators across the country who have also variously been damaged in sales.
Plus departed residents will be experiencing delays in receiving settlements.
This week Stockland CEO Mark Steinert, foreshadowing their financial year results, was reported in the Australian as follows:
Mr Steinert said sentiment in the retirement living sector is still affected by adverse media coverage last year when a Fairfax/Four Corners investigation alleged questionable business practices at listed retirement living operator Aveo.
Sentiment was gradually improving but the weakness would likely impact the full-year 2018 results, he said.
Reservations for units in Stockland’s retirement living business remained subdued over the (Jan-March) quarter.
Returning to our Google analytics results pictured, our enquiry traffic is back up and now 5-10% higher week on week compared to this time last year.
With 800,000 people searching for a retirement village home each year and only 20,000 homes coming available, potential demand far exceeds supply.
Confidence is what is damaged by negative media. This is the value that marketers must cherish and constantly reinvest in, particularly private operators. Many Not For Profit operators report they were not as savagely hit by the media.
Chris