Nine out of 10 people who re-sold a property reported to have earned themselves a profit during the March 2017 quarter.
House and unit resales earned $20.9 billion in profits over the quarter with the median profit around $185,000. In contrast, the total gross losses realised over the quarter was recorded at $493.8 million with a median gross loss of $35,000 per re-sale.
These statistics were sourced from CoreLogic's quarterly analysis of residential properties which were resold over the quarter, the CoreLogic Pain & Gain report, which compared the most recent sale price to the previous sale price in order to determine whether the property sold at a gross profit or gross loss. It provided a proxy for the performance of each housing market and highlights the magnitude of profit or loss for the typical seller of a home.
The report revealed some of the best and worst performing areas in Australia's capital city and regional areas:
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Across the capital cities, vendors' reselling earnings were varied: Sydney resales earned 97.8%, Melbourne 95.3%, Adelaide 92.5% and Hobart 95.4% while vendors in Darwin 63.0%, Perth 76.8%, Canberra 90.4% and Brisbane 90.8% profit earnings were significantly less.
In the regional areas of the country the top resale earners were in the Southern Highlands and Shoalhaven at 98.8%, Illawarra at 98.6%, Newcastle and Lake Macquarie at 98.2%, Sydney at 97.8% and Geelong at 97.3%.
The biggest regional losses came from regional areas closely linked to the mining and resources sector. The Pain & Gain regional results found that 11.1% of houses resold for less than their previous purchase price over the first quarter of 2017.
By proportion, regional house sales losses were marginally higher than the 11.0% over the December 2016 quarter and slightly higher than the 10.9% in March 2016.
CoreLogic report author Cameron Kusher said there was a relatively high proportion of units in regional Australia reselling at a loss (17.2%) however, the proportion of loss making unit sales shifted substantially lower as lifestyle markets saw buyer demand rebounding and mining regions approach the bottom of their cycle.
At the end of 2016, 17.9% of regional units had resold at a loss and in March 2016 quarter the proportion was recorded at 19.7% of all properties. The 17.2% of regional units resold at a loss is the lowest proportion since the December 2010 quarter.
"While the proportion of loss making sales has started to reduce in some of these regions, there remains a high willingness from home owners to sell up coupled with little demand to purchase," Mr Kusher said.
"As a result we are seeing a high proportion of vendors materialising their losses.
"We found that the unit sector is more prone to over supply which is another factor that is likely weighing down the resales performance.”
The proportion of houses resold at a loss has increased from 5.1% over the December 2016 quarter and 5.3% over the March 2016 quarter. The proportion of capital city houses resold at a loss was at its highest level in March 2017 since the three months to February 2014.
The proportion of capital city units resold at a loss was higher than the 10.1% recorded over the final quarter of last year and the 9.8% a year ago. The proportion of capital city units reselling at a loss is hovering around its highest level since early 2013.
