2 ASX 200 real estate shares being bought up by directors

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Directors of ASX real estate shares are buying up stock in October, signalling a potential vote of confidence for the sector.

The leadership outfits of both Stockland Corp Ltd (ASX: SGP) and Vicinity Centres (ASX: VCX) are buying up shares, bullish actions amid a challenging property landscape.

With ASX real estate shares impacted by rising interest rates and market volatility, insider purchases like these could point to optimism in a company’s future direction. Whether they are correct or not is a discussion between fate and economic reality.

Here’s the insider moves for these stocks.

Directors buying ASX real estate shares

ASX real estate shares have had a mixed year so far in 2024. The S&P/ASX 200 Real Estate index (ASX: XRE) tracks the sector, and is up 17% this year to date.

But most of this growth was obtained in the November 2023 – April 2024 period, when the broader market was rallying.

After nudging to new highs in September, it has retreated nearly 3% lower over the past month. That hasn’t stopped directors of ASX real estate companies buying up stock in recent weeks.

Stockland director Tarun Gupta recently increased his stake in the company, picking up 203,864 ordinary shares and 699,660 performance rights.

These were obtained at $4.28 per share.

This acquisition comes on the heels of Stockland’s push to strengthen its portfolio in residential and commercial properties.

Morgan Stanley rates the ASX real estate share a buy with a price target of $6.35. The broker sees Stockland as well-positioned to benefit once interest rates begin to stabilise and fall.

This could make it a prime candidate for dividend-seeking investors.

Vicinity Centres gains insider support

Vicinity Centres is another ASX real estate share that has also attracted insider buying this month.

Director Georgina Lynch recently acquired 83,937 Vicinity shares through an on-market transaction valued at roughly $182,983.

This vote of confidence arrives as Vicinity continues to rebound from pandemic-driven disruptions to its retail properties, with optimism growing around consumer foot traffic and retail spending.

Vicinity also announced the appointment of Angus McNaughton as new director on Tuesday. McNaughton is yet to declare any ownership in the company.

CLSA analysts were bullish on a rebound in the ASX real estate sector in a September note. The broker expects tailwinds from interest rate cuts and a pick-up in construction activity.

ASX real estate shares like Vicinity stand to benefit if this is the case, CLSA says.

Foolish takeout

When directors personally invest in ASX real estate shares like Stockland and Vicinity Centres, it can signal their belief in the company’s growth trajectory.

But buyer beware – a detailed analysis of the company and underlying industry is also needed. Whilst insider transactions are tremendously helpful knowledge, they should never be relied upon as indicators to buy or sell a security yourself.

In the last 12 months, Stockland is up 45%, whereas Vicinity Centres has climbed 28%.