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87.7% of homes sold for profit in March quarter

Less than 13 per cent of houses resold at a loss during the first quarter of 2020, despite floods, bushfires and COVID-19.

New figures from CoreLogic analysed approximately 72,500 sales over the first three months of the year.

It shows profit-making sales in March were only down 1 per cent from the December quarter, a nominal amount. Gross profit was down 12 per cent from the December quarter: $19.8 billion against $22.5 billion.

Compared to the housing market downturn the previous March, gross profits this March were up $5.5 billion.

Eliza Owens headed up the CoreLogic research, noting there has been an uplift in the portion of loss-making sales over the March quarter.

“But despite the potential for some fallout from COVID-19 at the end of the quarter, only a small portion of the loss making sales are a reflection of the onset of the pandemic,” Ms Owens explained.

The reason for this was a reduction in overall sales in March, with vendors choosing not to put properties on the market during that newly-volatile period. This helped stem much of the losses that would have occurred during this transaction period.

“The results over the second half of 2020 could see an increase in the portion of loss-making sales, but the volume of sales activity may be more subdued, as vendors were less likely to test the market at the height of the pandemic,” Ms Owens said.

“However, assistance for mortgage holders whose jobs and incomes have been impacted by the pandemic was likely also instrumental in keeping loss making sales low.”

Read the full report here.

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