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CoreLogic RP Data December 2014 Quarter Pain & Gain Report

Posted by CoreLogic RP Data on 1 April 2015
Analyst and author Cameron Kusher noted that making a gross profit or loss on property differs significantly from property-to-property and area-to-area, and in some instances is based on the length of time a property has been owned. 

For homes purchased on or after January 1st, 2008, the propensity to make a loss on the resale climbs substantially. Of those homes that resold over the December 2014 quarter, 14.1 per cent recorded a gross loss relative to the previous purchase price.

For resales incurring a gross loss over the December quarter, the average length of ownership was just 5.9 years. Properties that recorded a gross profit were held for an average of 10.2 years, while those homes that resold for more than double the previous purchase price were owned for an average of 16.8 years.

The proportion of loss-making resales has fallen to 8.6% over the Dec-14 quarter from 9.1% the previous quarter and 9.6% a year earlier.

In Queensland, the largest proportion of loss-making resales was located in the following regions:

Mackay (Qld) (34.7%)
Fitzroy (Qld) (29.6%)
Townsville (Qld) (29.1%)
Wide Bay (Qld) (28.2%)
Cairns (Qld) (23.6%)
Outback (Qld) (22.9%)
Gold Coast (Qld) (21.4%)

The lowest proportions of loss-making resales in Queensland was recorded in Toowoomba (Qld) (2.7%).

Brisbane Council Regions

Across Brisbane region, the proportion of loss-making resales has trended lower over recent months and was recorded at 10.5% over the December 2014 quarter, down from 10.9% the previous quarter and 13.0% a year earlier. The Brisbane Council area has a significantly lower proportion of loss-making sales compared to all other regions at 6.2%. The council areas with the highest proportion of loss-making resales were Lockyer Valley (28.6%), Scenic Rim (27.0%) and Ipswich (18.4%).

Region Gross Loss-Making Sales - December Quarter 2014 Gross Profit making Sales - December Quarter 2014
  % of Sales Average Hold Period Median Loss % of All Sales Average Hold Period Median Profit
Brisbane 6.2% 5.3 -$27,000 93.8 10.3 $163,500
Ipswich 18.4% 5.4 -$19,500 81.6% 9.3 $68,650
Lockyer Valley 28.6% 5.6 -$24,500 71.4% 8.8 $58,750
Logan 14.6% 5.7 -$19,250 85.4% 10.5 $85,000
Moreton Bay 17.4% 5.6 -$22,750 82.6% 8.6 $76,000
Redland 11.4% 5.2 -$20,000 88.6% 10.1 $104,000
Scenic Rim 27.0% 5.0 -$36,500 73.0% 8.2 $60,000
Somerset 17.1% 6.0 -$35,000 82.9% 9.9 $93,500


Author: CoreLogic RP Data

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