The percentage of residential property sales being made at a loss continues to grow, according to Cotality's latest Pain and Gain Report.
It found 9.2% of all residential sales in the first quarter (Q1) of this year sold for less than their previous purchase price, leaving their vendor-owners with a capital loss. (Cotality was formerly known as CoreLogic).
That's up from 8.9% in Q4 last year.
Around the country the areas with biggest percentages of loss making sales were MacKenzie District 15.8%, South Wairarapa 14.0% and Marlborough 13.6%.
In the main centres the biggest percentage of loss making sales in Q1 was in Auckland 14.2%, followed by Wellington 10.9%, Hamilton 10.3%, Tauranga 9.4%, Dunedin 7.1% and Christchurch 4.6%.
The median loss across all loss-making sales was $50,000.
The pain accompanying that sort of loss will be even greater once selling expenses such as agent's fees and legal costs are added.
Apartments are by far the most likely type of property to sell at a loss, with a third of the apartment sales (32.8%) in Q1 making a loss, compared to 8.4% of houses.
The average loss on apartment sales was $63,000, compared to $49,000 for houses.
The main determinant of whether a property sells for a profit or a loss appears to be time.
The median length of ownership for the properties that sold for a profit in Q1 was 9.1 years, compared to 3.3 years for those that sold at a loss.
Cotality Chief Property Economist Kelvin Davidson said the Q1 figures told a story of resilience.
"Despite house prices still sitting about 16% below their early 2022 peak, most property owners are continuing to sell for a profit, especially those with longer ownership periods," he said.
9 Comments
Sounds like a bloodbath
Or is that a fart in a bath
Fact check. Sales are down. As is price. The only thing up at the moment is unsold listings and the losses on sales.
🍿
I'm all out of popcorn, waiting for this imminent armageddon that's been called for the last 4-5 years.
In the meantime, I've had to eat the popcorn watching the movie Armageddon.
Don't wanna close my eyes
Don't wanna fall asleep
Must be Auckland CV time?
Auckland's new CVs/RVs will confirm and lock into the mindset once and for all, the nominal losses of -20 to -25% for the buyers in the peak stupid spree of 2020 to 2023.
So REAL losses of -35 to -45% for the FOMO Auckland buyers, during peak stupid.
Yup. Paints a pretty bleak pic for specutown. Oh well, there's always lotto.
Bear in mind these losses will be simply based on the Gross sales figure. The detail that is missing is the added small fortune that the Real Estate folks and the banks have bled out of these people. So the losses are greater, and in greater numbers than those shown above.
True.
So, if my maths are correct, over 90% of all houses are sold for a profit, even during what NZGecko describes as:
"The Most epic housing crash in all of NZs history"
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