Selling your home? Most Australians made a profit this year, but units are seeing some big losses

Couple moving boxes upstairs into new homes

Australians looking to sell their home amid the current property boom may have one key question in mind: will they make a profit or a loss? 

According to CoreLogic’s latest ‘Pain and Gain’ report, the percentage of profit-making resales over the March quarter (Q1) hit a new high of 90.3% across Australia - up from 89.1% in the previous quarter. 

While this might sound like good news to sellers, the report noted that factors like location and property type could tip the scales either in or out of your favour. 

For instance, units were more than twice as likely to see a loss than houses. In Q1, 16.8% of units sold for a loss in Australia, compared to only 6.8% of houses. 

Meanwhile, the regional market continued to perform strongly, with resales there tending to generate more profit than capital cities. 

“March 2021 marked the fourth consecutive quarter where regional Australian resales sustained a higher rate of profitability than in capital city markets - 90.6% of regional resales saw a profit through the quarter, compared to 90% of capital city sales,” CoreLogic’s Australia head of research, Eliza Owen said. 

“However, the gap in the rate of profit seen between capital cities and regions have narrowed, and is likely to keep narrowing, given capital city growth rates have been closer to regional value growth rates through April and May.” 

The CoreLogic report analysed about 98,000 resales made between January and March 2021. 

In total, Australian sellers over the quarter made $30.6 billion in profit - down from $32.2 billion in the December quarter although Owen says this likely reflects a seasonal dip in sales activity at the start of the year. 

Trend of ‘tree changes’ continue

It’s perhaps no surprise why the regional markets have been doing so well on the profit front. 

A growing number of Australians are relocating from capital cities to regional areas, with the latest figures revealing that ‘sea change’ or ‘tree change’ levels have risen by 7% between the March quarters of 2020 and 2021.

“‘Sea change’ and ‘tree change’ markets have generally seen an uplift in the rate of profit making sales through the March quarter, including an extraordinary 99.5% of Ballarat sales making a profit through the March quarter,” said Owen. 

On the flipside, traditional investor markets like Melbourne CBD units have been struggling. For instance, over the March quarter, the volume of loss-making unit resales reached a record high of 173 - although this is in the context of more sales being made overall. 

“For this region, investor sales may have been triggered by rental values falling more than 20% over the year. As long as COVID weighs on international travel and inner-city economic activity, this market is likely to see subdued performance,” Owen said.

RELATED: 6 things to do a year before you buy your new home 

Having thoughts about downsizing or moving to a regional area? If you’re looking to sell your property and buy another home, you’ll need a home loan to make it happen. 

Get started by browsing some of the great offers below, or compare home loans from an even broader range of lenders over at our comparison hub.

Alternatively, you still haven’t paid off the home loan on your existing property, you may want to check out our guide on selling a home with a mortgage.

Compare home loans - last updated 29 November 2023

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