Powered by MOMENTUM MEDIA
subscribe to our newsletter
Nine in 10 resales gained profit in Q1 2017

Nine in 10 resales gained profit in Q1 2017

Just over 90 per cent of Australian property resales during the March 2017 quarter earned a profit, earning vendors $20.9 billion in gains, new figures show.

In the quarter ending March 2017, just 9.6 per cent of dwellings sold for less than their previous purchase price, the latest CoreLogic Pain and Gain report reveals.

The median profit gained was around $185,000 while the median loss experienced was $35,000.

Advertisement
Advertisement

While the gross profit from resales came in at a whopping $20.9 billion, the proportion of dwellings sold at profit was slightly down from the previous period.

The rate of houses resold at a loss rose from 5.1 per cent in the December 2016 quarter (and 5.1 per cent in the prior comparative period) to 8.1 per cent, while the rate of resell losses for capital city units grew from 10.1 per cent (and 9.8 per cent in the prior comparative period) to 11.5 per cent.

However, the proportion of regional units reselling at a loss dropped to its lowest figure (17.2 per cent) since the December 2010 quarter, down from 17.9 per cent in the December 2016 quarter.

Since 1997 there hasn’t been a quarter where the percentage of houses reselling at a loss was higher than the percentage of units, CoreLogic statistics show.

The phenomenon has occurred because the value of a house is attached to the underlying land value, but the value of a unit is linked to location, CoreLogic’s head of research Cameron Kusher explained.

“The unit sector is more prone to over supply which is another factor that is likely weighing down the resales performance.”

“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. As a result we are seeing a high proportion of vendors materialising their losses,” Mr Kusher said.

[Related: Fall in home-ownership not surprising, says CoreLogic]

Nine in 10 resales gained profit in Q1 2017
mortgagebusiness

 

Latest News

ASIC is determined to flex its muscles, with a bill designed to enhance its enforcement powers one step closer to law.  ...

Treasurer Josh Frydenberg has told the banks and regulators that they will face an inquiry down the track to ensure they have lifted their g...

A CEO has welcomed the introduction of legislation that would “remove a handbrake” that has held back customer-owned banks from competin...

FROM THE WEB

POST RC PANEL DISCUSSION ADDED

podcast

LATEST PODCAST: The current mindset of the mortgage industry

Is enough being done to ensure responsible lending?