According to the latest Pain and Gain report from realestate data firm CoreLogic, despite a recovery in house prices, a fifth of apartment losses were sold in the third quarter of last year as a result of rising vacancy rates, high levels of supply on the market and soaring mortgage costs, the Australian Financial Review reported.
While Sydney, Melbourne and Hobart reported a decline in the number of loss-making sales, Perth, Brisbane, Adelaide and Canberra were not optimistic. In Sydney, the number of apartments sold at a loss fell 1.7 percent to 12.5 percent and Melbourne fell 2.3 percent to 15 percent as strong population growth held high demand.
Other capital cities saw the share of loss-making sales rise by 5.1 per cent to 52 per cent, Adelaide`s share of loss-making sales rose by 7.6 per cent to 23.6 per cent and Canberra`s by 1.1 per cent to 21.1 per cent.
Eliza Owen, head of residential research at CoreLogic, said:" Oversupply and concerns about the quality of the buildings have severely affected the resale value of these flats." Over the past few years, a significant rise in supply levels in many capital cities, especially in Brisbane and the chieftain, has led to a fall in prices and a rise in vacancy rates, affecting the resale returns of investor-dominated apartments. 」
(Chart: Sohu)
By contrast, the percentage of independent houses sold nationwide is much more profitable, with nine out of every 10 independent houses achieving profit growth.
Nationwide,16.6 percent of the investment realestate was sold at a loss, slightly improving from the previous quarter, but still up from 11.1 percent of the self-occupied realestate that sold at a loss.
In the investment house, sellers in the city continued to amass substantial profits over the past five years as home prices in Hobart rose by 43.8%. In the third quarter of last year,98.8% of the investment realestate reselling in Hobart made a profit, and up to 98% of homeownership.
Mr Owen said:" This may reflect the difficulty of investors in attracting tenants to their real estate while addressing the rising cost of mortgage repayment, as they move away from pay-only loans to service their debt, making it increasingly difficult to hold assets. 」「 investors are also more willing to take losses because they can use future capital gains to offset those losses rather than self-owners. If house prices fall, investors may be more inclined to sell house, exit the market, release capital, and make up for losses with future investment profits. 」
