REAX and Firm Capital (FCA.UN): 2 TSXV real estate stocks to buy

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REAX and Firm Capital (FCA.UN): 2 TSXV real estate stocks to buy

REAX & Firm Capital (FCA.UN): 2 TSXV real estate stocks to buy
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Highlights

  • Housing affordability is one of the primary issues the Canadian government addressed while announcing Budget 2022. 
  • Real Brokerage saw its 2021 revenue climb 635 per cent year-over-year (YoY).
  • Firm Capital Apartment posted a net income of US$ 3.47 million in Q4 FY2021.

Housing affordability is one of the primary issues the Canadian government addressed while announcing Budget 2022 on Thursday, April 7. The government proposed prohibiting foreign businesses and non-Canadians from buying "non-recreational, residential" properties for two years to minimize the impact of foreign money on housing costs, particularly in major cities like Vancouver, Toronto, etc., and ensure housing affordability across Canada.

On the other hand, Statistics Canada recently reported that multiple-property owners held 29 to 41 per cent of the property stock in Nova Scotia, New Brunswick, Ontario and British Columbia in 2020, according to the latest data from the Canadian Housing Statistics Program (CHSP).

The data also revealed that these owners accounted for 15 per cent of all owners in British Columbia to 22 per cent in Nova Scotia.

So, let us talk about 2 TSXV real estate stocks and evaluate their overall performance in the wake of latest housing data and governments attempt to ease housing prices .

The Real Brokerage Inc (TSXV: REAX)

Real Brokerage is a junior real estate broker that provides its technology platform to real estate agents. The firm earns commissions from the sale of real estate properties and subscription revenue. It also offers auxiliary services.

Real Brokerage saw its 2021 revenue climb 635 per cent year-over-year (YoY) to US$ 121.7 million.

REAX stock swelled by approximately 18 per cent in the last one year.

Also read: Canada Budget 2022 gives housing $10B: 2 TSX real estate stocks to buy

Firm Capital Apartment Real Estate Investment Trust (TSXV: FCA.UN)

Firm Capital is a junior real estate entity that deals in multi-residential assets. The REIT posted a net income of US$ 3.47 million in Q4 FY2021 compared to US$ 2.47 million a year ago.

Its funds from operations (FFO) amounted to US$ 0.49 million in the latest quarter, up from C$ 0.45 million in Q4 FY2020.

United of Firm Capital declined by over three per cent in the past 12 months.

REAX & Firm Capital (FCA.UN): 2 TSXV real estate stocks to buy

Bottomline

CHSP’s data showed that individual multi-property owners own a “significant” share of the residential stocks despite small number of owners, added Statistics Canada.

Investors with money constraints could explore junior real estate stocks like Real Brokerage and Firm Capital to diversify portfolio risk and profit from the real estate industry. However, it is necessary to note government actions to calm soaring housing prices and measure its impact on real estate stocks.

Also read: RioCan & TCN: TSX housing stocks to buy as Toronto home prices rise 18%

Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.

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