14 Oct 2014
The RP Data Pain & Gain report is a quarterly assessment of realised gross profit and loss based on dwelling re-sales over the June quarter of 2014.
According to RP Data head of research Tim Lawless, with home values rising at a national level and mortgage rates and arrears low RP Data expects that the proportion of loss-making re-sales is likely to continue to trend lower over the coming year. In regional markets we expect coastal lifestyle markets to continue to slowly recover while resource centric areas may continue to see a rise in loss-making sales as commodity prices continue to fall along with mining employment. Download the Pain & Gain report.
Report findings at a glance:
- Resource and some lifestyle regions showing largest proportion of loss making re-sales
- Queensland’s Mackay region recorded the largest proportion of loss making re-sales, with 34.8% of all June 2014 quarter resold homes transacting at a price lower than purchase price.
- Capital cities and near capital city regions recorded low rates of loss-making re-sales, with Sydney recording the nation’s lowest proportion at just 2.7%.
- 70,357 residential property re-sales nationally for the second quarter of the year
- 9.0% recorded a gross loss from the original purchase price.
- Gross value of the losses associated with these loss making re-sales totalled $398.3 million
- 91% of all June 2014 quarter re-sales recorded a gross profit relative to their original purchase price. The gross profit from these re-sales equated to $14.4 billion.
- 9.0% of all homes that resold over the second quarter of 2014 recorded a gross loss compared with original purchase price – down from 9.7% at the end of the first quarter of 2014 and much lower than the 11.5% recorded over the June 2013 quarter.
- The gross value of losses on homes re-sold over the quarter was recorded at $398.3 million
- The average gross loss per loss making transaction was $63,097.
- 91% of all re-sales over the June quarter of 2013 transacted at a gross profit, with 30.5% of all re-sales at least doubling their money compared with their original purchase price.
- Gross profit on re-sales was $14.4 billion
- Average gross profit per profit making transaction was $225,830.
- Download the Pain & Gain report.
According to Tim Lawless, the likelihood of making a gross profit or loss is quite different based on the length of time a property has been owned.
You can watch more on the Pain and Gain release with an interview with RP Data senior research analyst Cameron Kusher on news.com.au. Watch interview
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