Units the biggest loser in resales

Units on average recorded higher resale loss than houses over the last quarter, according to the latest CoreLogic report.

In Melbourne, Brisbane and the ACT, the proportion of units resold at a loss was more than double that of houses.

CoreLogic head of research Cameron Kusher this was due to several factors in the property market.

“Houses have typically recorded a superior rate of capital growth to that of units and those houses reselling at a profit tend to record a much greater profit than units. These factors go some way to explaining why units are recording a much higher proportion of loss-making resales than houses,” Mr Kusher said.

“Another point to consider is ownership. Units rather than houses are more likely to be owned by investors. The ability to offset losses on investment properties against future capital gain is likely to provide investors with much more of an incentive to sell at a loss than owner-occupiers.”

By capital city, Sydney posted the smallest proportion of house resale losses at 2.4 per cent, followed by Melbourne (4.4 per cent) and Brisbane (8.4 per cent).

Sydney was the only capital city which had a lower proportion of unit losses compared to houses.

Meanwhile, Darwin and Perth recorded the largest proportion, at 24.2 and 20.1 per cent respectively.

Across capital cities, the average unit loss was recorded at $67,456, while houses posted an average loss of $94,926.

In regional areas, the margin between the two property types was much smaller, at $61,944 and $64,423 respectively.

On the other side of the equation, house resale profits far outweighed units, with capital cities recording averages of $363,442 and $229,596 respectively.

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