22 Dec 2015

CoreLogic Quarterly Pain & Gain Report, December release

The vast majority of property owners who sold their home in the September 2015 quarter sold at in excess of their previous purchase price according the latest CoreLogic RP Data quarterly Pain and Gain Report. 

The Report found that 91.6 per cent of properties resold for profit over the quarter with 31.4 per cent of homes selling for more than double their purchase price. The total value of all profit was $17.3 billion with the average gross ‘gain’ $265,605 per sale. 

Only 8.4 per cent of homes resold recorded a gross loss compared with their original purchase price, down slightly from 9.2 per cent for the June quarter. The total value of dwellings which resold at a loss over the quarter was $376.2 million. The average ‘pain’ felt for these properties was $63,221. 

Whether for investment of owner occupation, the results highlight the fact that property ownership should be seen as a long-term investment.

Across the country, those homes which resold for a loss had an average length of ownership of 6.0 years. For gross profit sales, the average length of ownership was recorded at 10.1 years, while homes which sold for more than double their previous purchase price were owned for an average of 16.9 years. 

The report also highlighted investors were more likely to resell their properties at a loss than owner occupiers.  Over the quarter, 7.3 per cent of owner occupier sales nationally were at a gross loss compared to 10.3% of investors.  

According to CoreLogic RP Data research analyst Cameron Kusher, a potential reason for heightened loss for investors comes down to the fact investors may be more willing and able to move on from poor performing assets as well as being able to utilise negative gearing to benefit from such a loss. 

The report also confirmed the proportion of loss-making resales across the national capitals is now trending lower in Sydney, Melbourne, Brisbane and Hobart, while in Perth and Darwin loss-making reseals are on the increase. Adelaide and Canberra remained flat and recorded little movement.

Across the capitals the lowest proportions of loss making resales are currently found in:

  • Sydney at 1.7% (which is also a record low)
  • Melbourne (5.4%)
  • Brisbane (7.6%)

Within the regional areas of the country the proportion of loss-making resales is higher than those within the capital cities and trending lower in Regional NSW. Conditions are flat in most regional areas except for Regional SA, Regional WA and Regional NT where loss-making resales are trending higher. 

The highest proportions of loss making resales were recorded in:

  • Regional WA (25.9%)
  • Regional SA (21.1%)
  • Regional Tas (19.6%)
  • Regional Qld (19.1%)

Proportion of total resales at a loss/gain, owner occupied vs. investors, September 2015 quarter

2015-12-18--painandgain

CoreLogic research analyst Cameron Kusher said, “Capital city housing markets continue to record a lower proportion of loss-making resales than regional areas of the country.  We’re seeing the trend shifting in regional areas with the proportion of loss-making resales trending lower particularly in areas linked to tourism and lifestyle factors. 

“Housing markets linked to the resources sector are generally seeing an increase in loss-making resale’s after housing market conditions in many of these locations have posted a sharp correction,” he said.

ENDS.


Media Inquiries to: media@corelogic.com.au or Mitch Koper on 1300 472 767

About the CoreLogic RP Data Pain & Gain Report:

The Pain and Gain report is a quarterly analysis of homes which were resold over the quarter.  It compares 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 provides a proxy for the performance of each housing market and highlights the magnitude of profit or loss the typical seller of a home makes across those regions analysed.



About CoreLogic

CoreLogic Australia is a wholly owned subsidiary of CoreLogic (NYSE: CLGX), which is the largest property data and analytics company in the world. CoreLogic provides property information, analytics and services across Australia, New Zealand and Asia, and recently expanded its service offering through the purchase of project activity and building cost information provider Cordell. With Australia’s most comprehensive property databases, the company’s combined data offering is derived from public, contributory and proprietary sources and includes over 4.4 billion decision points spanning over three decades of collection, providing detailed coverage of property and other encumbrances such as tenancy, location, hazard risk and related performance information.

With over 20,000 customers and 150,000 end users, CoreLogic is the leading provider of property data, analytics and related services to consumers, investors, real estate, mortgage, finance, banking, building services, insurance, developers, wealth management and government. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory and geo spatial services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and mitigate risk. CoreLogic employs over 650 people across Australia and in New Zealand. For more information call 1300 734 318 or visit www.corelogic.com.au.

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