VIC Not every resale makes a profit

In an article from the Aust Financial Review today (this may be behind a paywall), commentary from Core Logic reveals that 25% of resales in Melbourne CBD are made at a loss

Other interesting stats:



Biggest $ loss - Strathfield - more than triple the loss achieved in Melbourne (& double of Palmerston)

Also interesting to note is that East Fremantle has over 90% of resales in profit (after 11 years holding).

 

The image isn't comparing apples with apples though... looks like they are only taking one council area from each city.

And in the case of Strathfield, only 5% of properties sold result in a loss anyway, and these properties making a loss only have a median hold period of 3.6 years. If you do that to every council, and looked at what made a gain and what made a loss, Strathfield did well (only 5% of properties sold at a loss) compared to every council areas in most other states, especially Darwin where what's noted as a well performing council area still has 1 in 5 homes selling at a loss, and I'm sure the hold period would be longer than just 3.6 years.

The loss number - Strathfield houses are expensive, often 3 mill plus. This is contributing to that "big" number for average loss. But that would be small dollars relative to the value of the housing.

This is also from the article (believe it to be the properties of homes resulting in a loss) - you can see everything in and around Sydney has performed, thanks to this recent boom:

 

Playford in Adelaide doesnt surprise me. Lots of people who bought poorly at the peak of last cycle here would be losing money when they sell now. But on the flip side, those who bought well at the bottom of the current cycle are doing well.

 

It would be the same on the inner south-side of Brisbane in 4-6 pack walkup 2 bedroom units ,some we have looked at are over 50-70 k down from what the title holders paid 7 years ago..
Looked at one yesterday-one bedroom small under 200k-7 klms too the CBD and on the market for over 8 months and they paid 230k many years ago,not everyone wins in real estate as 2018 in that quite large market will be crunch time..

 

There's an over supply in some south side areas especially small units.

 

I could not get out of that one bedroom unit quick enough ,but the daughter thought because of the cost location it would be somewhere to start,and the agent did have a very solid sales pitch ..The Lady bypassed me and kept telling the daughter compared to all the legal granny flats in peoples back yard's in the area that unit was a winner..I asked the Agent how do people go with insurance and if someone makes a simple phone call to the BCC about the granny flat what happens from your experience,all she said it does not happen ever..

I only let them lie to me 3 times then it's finished say nothing say thankyou for their time and walk out,at least every time we look as it above 30 units now the daughter is starting to understand the real estate agents have no more chance of getting it right then you do..

 

I don't know what these stats means, because we don't have stats on the product its all lumped together, so it becomes meaningless.

In term of Melb one would assume it is in the main apartments?? because I do know that highest growth in this cycle has been houses/development sites.

 

Have a look how many are going up in the Richlands and Forest Lake areas.

 

Summed up perfectly @MTR. Holding period, property type, suburbs, o/o or ip etc all lumped in together.

No serious attempt to create substance just to establish a trend. As sales data goes across states and different property cycles no meaningful comparison can be made.

 

Richlands and Forest Lake is not investor quality.