CoreLogic’s Pain and Gain Report is a quarterly analysis of residential properties which were resold over the quarter.
CoreLogic’s Pain and Gain Report is a quarterly analysis of residential properties 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.
Across the country, 9.6% of dwellings sold for less than their previous purchase price over the first quarter of 2017. The proportion of dwellings selling for less than the previous purchase price was higher than the 8.8% over the final quarter of 2016. Houses have continued to show a lower proportion of resales at a loss (8.1%) than units (13.3%).
Looking at the regions where the instances of loss are highest, it continues to be headed by regional areas of the country, particularly those linked to the mining and resources sector. 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 but little demand to purchase which is resulting in a high proportion of vendors materialising losses.
The regions with the lowest proportion of resales at a loss makes for interesting reading. The Sydney and Melbourne housing markets have been powerhouses over recent years however, those regions outside but adjacent to Sydney are seeing a lower proportion of resales at a loss. Similarly in Victoria, Melbourne continues to see relatively few resales at a loss however, the proportion of loss-making resales is actually lower in Geelong.
The capital city housing markets continue to generally record a lower proportion of loss-making resales than regional areas of the country. However, in many capital cities we are seeing a growing divergence between the resale performance of houses relative to units.
The trends in regional areas show that the instances of homes reselling at a loss are continuing to trend lower in most coastal and lifestyle markets while losses remain very high in most of the regions linked to the resources sector.