Just over 12.1 percent of all residential dwellings sold in Australia during the March quarter were sold at a loss; this according to a recent report issued by the real-estate information services firm CoreLogic. This number marks an increase from 9.0 percent during the same period of last year, and signifying the largest proportion of losses recorded since the March quarter of 2013.
The biggest losses were recorded in the multi-residential sector, where in excess of one in five (20.5 percent) townhouses, units and apartments were sold at a loss. In the arena of detached housing, losses have elevated from 5.6 percent of all sales in 2018’s March quarter to nearly one in ten (9.5 percent) sales in the March quarter of 2019.
Losses are rising in Sydney and Melbourne, although the most sizable portion of loss-making sales related to resource areas. Overall, Darwin accrued the most sizable share of losses, as 58.2 percent of units and 40.8 percent of detached houses sold through the city throughout the quarter sold at a loss. Losses are prevalent in Brisbane and Perth as well, and are trending upward in Sydney and Melbourne.
In Sydney, 9 percent of dwellings currently sell at a loss – a percentage that has more than doubled since a prosperous period spanning 2015-2017. In Melbourne, 97.5 percent of detached homes sell at a profit–however, nearly one in five (17 percent) units sold throughout the March quarter sold at a loss. In inner regions like as Melbourne City, Stonnington and Yarra, loss-generating sales rank at 31.8 percent, 24.0 percent and 18.5 percent of total sales respectively.
In the area of Sydney, 20 percent of Strathfield homes sold at a loss during the quarter. Losses rank the most substantial in the investor market, which is more weighted in the direction of inner-city apartment units.
Overall, 17 percent of investor held dwellings that passed hands throughout the March quarter were sold at a definite loss. This ratio compares to 10.5 percent for owner-occupied residences.
In Melbourne and Brisbane, 12.6 percent and 21.9 percent of investor-possessed dwellings respectively were sold at a loss. This compares with percentages of 3.5 percent and 7.9 percent losses for owner-occupied dwellings in these communities.
CoreLogic Research Analyst Cameron Kusher believes that these losses are symptoms of a weakened housing market.