Even in heavily loss-making suburbs where two in five sales are a bust, there’s one type of home that’s almost a sure thing.
Homes in mortgage belt areas were more likely to make a profit, because they were more likely to be houses.A remarkable 40.7 per cent of property sales in the Melbourne City Council area were made at a loss in the last three months of 2023, well ahead of any other local government area across the city.
The results for the quarter were a reflection of the fact property values were rising for most of last year, he said. “Most borrowers are going to be in a positive equity position, and if they need to sell they can probably do so proactively and sell their home for more than what they paid for it,” he said. “Generally, we find investors are more willing to incur a loss on their resales simply because you remove the emotion from the decision.”Many of the areas with higher rates of loss-making sales were high-density, high-supply neighbourhoods, Lawless said.
A shift in preferences to living in larger homes, typically houses, has helped to keep unit prices low.The Property Bureau buyers’ advocate Alastair Mairs said the high proportion of loss-making sales in unit-heavy areas was probably a result of investors offloading negatively geared properties.
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