There is a lot of mixed news both locally and coming from overseas. As the world grapples with the pressure of inflation, supply chain issues and tightening monetary policy, there are many opportunities for general media to publish sensational headlines. It’s good to stay abreast of developments, both negative and positive – but it’s also extremely important to consider facts, statistics, and numbers. Remember, newspapers sell headlines, statistics tell stories.
One key statistic we like to follow at Trilogy Funds is building approvals. This information is publicly available, and published just over a month in arrears by the Australian Bureau of Statistics (ABS).
Earlier this month, the ABS published the Building Approval Statistics for February 2023. In the month of February, total dwellings approved increased by 4% compared to the prior month, to 12,661 approvals on a seasonally adjusted basis. The number is down significantly year on year, however, this statistic tells us that confidence is high enough to inspire buyers, builders, developers and investors to commence the development of over 12,000 dwellings in one month alone.
In his monetary policy statement this month, RBA Governor Philip Lowe indicated that further interest rate rises are possible, and that managing inflation was still the RBA’s key priority. While he flagged concern regarding high global inflation, he also acknowledged that inflation in Australia appears to have peaked. Household consumption growth fell in March for the fourth consecutive quarter, which would have provided some comfort that previous monetary policy tightening is having an impact. He also makes mention of Australia’s strong banking system. These themes are echoed in the Financial Stability Review April 2023.
As you’re no doubt aware, the RBA did not raise interest rates earlier this month. However, the March meeting represented the 10th consecutive increase in rates.
At Trilogy Funds, we are comfortable with the level of activity in the markets in which we operate. We continue to manage close relationships with our borrowers and monitor the loans and properties in our portfolios closely.
While past performance is not a reliable indicator of future performance, we are pleased that over the last 12 months, we have raised the distribution rates for the Trilogy Enhanced Income Fund and the Trilogy Monthly Income Trust every single month.
Naturally, we will continue to work closely with our borrowers and monitor our portfolios, and will continue staying abreast of local and global developments which may impact our products and investors.
This article is issued by Trilogy Funds Management Limited ABN 59 080 383 679 AFSL 261425 (Trilogy Funds) as responsible entity for the management investment schemes mentioned in this article. Application for investment can only be made on the application form accompanying the relevant Product Disclosure Statement (PDS) and by considering the Target Market Determination (TMD) available at www.trilogyfunds.com.au. The PDS contain full details of the terms and conditions of investment and should be read in full, particularly the risk section prior to lodging any application or making a further investment, together with the TMD. All investments, including those with Trilogy Funds, involve risk which can lead to no or lower than expected returns, or a loss of part or all of your capital. Trilogy Funds is licensed to provide only general financial product advice about its products and therefore recommends you seek personal advice on the suitability of this investment to your objectives, financial situation and needs from a licensed financial adviser. Investments with Trilogy are not bank deposits and are not government guaranteed. Past performance is not a reliable indicator of future performance.