A new report by property researcher CoreLogic has found that the property market in rural and regional areas experienced a boom in the last financial quarter.
The latest Corelogic Pain and Gain report found that just over 88 percent of housing sales made a gain in the September quarter, translating into $24.8 billion in profits. This was an increase of $5 billion from the June quarter 2020.
“Each of the greater capital city markets, with the exception of Melbourne, saw an increase in the rate of profit-making sales over the September quarter,” Owen said. “The highest rate of profit-making sales was across Hobart, which has been the case since March 2018.”
Coastal regional markets were particularly valuable for sellers, with profit-making sales representing over 95 percent of resales across the six major coastal markets of Geelong, Illawarra, the Mid North Coast, the Newcastle Lake Macquarie region, the Richmond Tweed region and the Sunshine Coast.
However, not all areas of the housing market were on the move.The report, which analysed approximately 72,000 residential property re-sale events also noted that property investors were hit the hardest by the declining values, with a fall in demand for apartments making those properties twice as likely to sell for a loss.
It is an area Domain senior research analyst Dr. Nicola Powell warned could suffer more pain with the definitive end of mortgage holidays in March. Powell believes this could increase distressed sales, as more investors will be forced to sell at a loss.
“If an investor is struggling to attract a tenant there is only so long they can support that property with no rental income …. so, as we see more properties come off mortgage holidays, we could well see more investors having to offload their properties.”
