REA Group Ltd (ASX: REA) shares have been hotly covered over the past year. 

It is an online real estate advertising company that provides property and property-related services on websites and mobile apps across Australia, Asia, and North America.

Threats of AI, elevated property prices, and changing consumer behaviour have all raised questions about the company’s long-term growth prospects. 

In the last 12 months, REA Group shares have experienced volatility and ultimately remain down 30% in that span. 

Valuations from experts have fluctuated over this period, as the company’s strong market position and exposure to Australia’s property market continue to attract investor attention.

However, a new report from Bell Potter has suggested there may be better opportunities elsewhere for investors. 

Sell recommendation for REA Group shares

In Thursday’s report, the team at Bell Potter reiterated its sell recommendation. 

The broker said ongoing low clearance rates and lengthening days on market for properties suggest an ongoing mismatch in price expectations between buyers and sellers. 

Additionally, further declines in house prices are expected over the coming months. 

Days on market has increased by 8 days versus this time last year, while national auction data from SQM suggests that cumulative auctions are down -24% for the FY-to-date versus the comparable period last year; the cumulative number of houses sold via auction is significantly worse at -50% YoY.

Little to no upside over the next 12 months 

Along with the sell rating, Bell Potter has a price target of $148 on REA Group shares. 

From current levels, this indicates a downside of 7%. 

We retain our Sell recommendation. Despite REA’s ability to generate strong results in challenged operating environments, we continue to see significant downside risk to listings volumes/earnings vs. company guidance and consensus and await further data points via lending volumes and market listings before re-considering our thesis.

What are other experts saying?

Valuations appear mixed on REA Group shares. 

Last month, Tom Fairchild from Lazarus Capital Partners had a buy rating on this ASX 200 communications share. 

At the time, REA Group shares were trading at almost $180. 

15 analyst ratings via TradingView have an average 12-month price target of almost $200 on REA Group shares. 

This indicates a 40% upside from current levels. 

However, it is worth noting that individual targets range from highs of $253 per share to lows of $147, underscoring the wide gap in opinions on this ASX 200 stock. 

The post Why this expert believes it’s time to exit positions in REA Group shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

How much you can own in assets while remaining eligible for the age pension will increase tomorrow, 20 September.

The changes reflect indexation adjustments, which are made twice per year, to account for inflation.

Let’s find out what’s changing tomorrow.

How much can you own and still get the age pension?

If you were born on or after 1 January 1957, you can apply for the pension from age 67.

You do not have to be in retirement to qualify for the pension. It’s an entitlement based on age, but it’s subject to a few rules.

Among the most important are the assets and income tests.

The pension is means-tested because it is social security designed to support senior Australians who need it most.

Tomorrow, the rules for both tests change. In this article, we’re focusing on the assets test changes.

Assessable assets under the test include superannuation, ASX shares, bonds, investment properties, cash, and home contents.

Your primary place of residence is excluded from the assets test.

If you rent, the rules allow you to own more in assets while still qualifying for the pension.

Under this next round of indexation changes, the upper thresholds for the assets test are increasing.

Here are the details.

Do you own your home?

Single homeowners whose assets are worth less than $333,000 qualify for the full age pension.

Single homeowners whose assets are worth between $333,001 and $745,750 (up from $733,500) will be eligible for a part-payment.

Couple homeowners whose assets are worth less than $499,000 are eligible for the full age pension.

Couple homeowners who have between $499,001 and $1,121,000 (up from $1,102,500) in assets will be eligible for a part-payment.

Do you rent your home?

Single renters whose assets are worth less than $600,000 qualify for the full age pension.

Single renters who have between $600,001 and $1,012,750 (up from $1,000,500) in assets will be eligible for a part-payment.

Couple renters whose assets are worth less than $766,000 qualify for the full age pension.

Couple renters who have between $766,001 and $1,388,000 (up from $1,369,500) in assets will be eligible for a part-payment.

Age pension to increase by $37 per fortnight

Pension payments are also increasing from tomorrow.

Singles will get an extra $36.80 per fortnight, raising the total age pension payment to $1,237.70 per fortnight.

Couples will get an extra $27.80 per partner, per fortnight, increasing the total payment to $933 per partner, per fortnight.

If you’re curious about how much income you can earn while still getting the age pension under the new rules, read our article here.

The post How much in assets can you own and still get the age pension under new rules starting tomorrow? appeared first on The Motley Fool Australia.

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Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Investing $500 a month may not sound like enough to change your life.

But give it enough time and the numbers can become surprisingly large.

That is the power of combining regular investing with compounding.

But what about income? Could it help build a major source of passive income? Let’s run the numbers.

Why $500 a month can go a long way

One of the best things about investing regularly is that you do not need to worry too much about finding the perfect time to buy.

By putting $500 into ASX shares like CSL Ltd (ASX: CSL), Goodman Group (ASX: GMG), or Wesfarmers Ltd (ASX: WES) every month, you will inevitably buy during strong markets, weak markets, corrections, and everything in between.

This is called dollar-cost averaging or DCA.

It takes some of the emotion out of investing and turns wealth building into a habit, allowing compounding to start doing more of the work.

What could the passive income look like?

After 10 years of investing $500 a month, the portfolio would be worth approximately $100,000 based on a 10% average annual return. That return is not guaranteed, but it is achievable and largely in line with historical share market returns.

If an investor then moved that money into a portfolio producing a 5% dividend yield, it could generate around $5,000 of passive income each year.

But why stop there? If you keep going for another decade then things start becoming much more substantial.

For example, after 20 years, the portfolio could be worth roughly $360,000. At a 5% dividend yield, that could produce almost $18,000 a year in passive income.

By year 30, compounding has had even more time to work its magic. All else equal, the portfolio would be worth approximately $1 million, capable of generating around $50,000 a year at a 5% yield.

And after 40 years, the same $500 monthly investment could potentially grow to approximately $2.8 million.

A portfolio of that size yielding 5% could produce almost $140,000 a year in passive income. Not bad!

Key takeaway  

Investing for passive income is something that takes time. But as the examples above demonstrate, it certainly can be worth the patience.

The main thing is getting started. Investing $500 a month into ASX shares may not look meaningful today. But repeated hundreds of times and given decades to compound, it can become something very material.

The post How much passive income could I make by investing $500 a month in ASX shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in CSL and Goodman Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Goodman Group, and Wesfarmers. The Motley Fool Australia has recommended CSL, Goodman Group, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.