Brisbane homeowners rake in a billion dollars in profit a month

Source: The Courier Mail.

Brisbane homeowners have walked away with almost a billion dollars a month in profit over the past quarter as the housing market continues to sizzle. But one sector is not quite as lucrative, latest data shows.

The latest CoreLogic Pain & Gain report, released Monday, showed homeowners in Greater Brisbane made $2.994 billion in gross profit off the sale of properties sold during the June quarter – almost a billion a month.

There was a word of caution though, with -$61.75 million in loss-making sales also processed during that three-month period.

CoreLogic report author and head of research Eliza Owen said nationally, profitmaking residential property sales had now been rising for four consecutive quarters as tight listings, record low mortgage rates and extraordinary growth in housing values push up resales gains for vendors.

“This number really does reflect the extraordinary recovery in housing values following a small downswing induced by the initial impact of COVID-19,” Ms Owen said.

The typical median hold period on all profitmaking resales in Greater Brisbane during the quarter was 8.8 years, while the median hold time for lossmakers was 9.8 years.

“Profit-taking sales across Brisbane increased 90 basis points to 90.1 per cent through the June 2021 quarter,” Ms Owen said. “This marks the first time profitmaking resales have been above 90 per cent since the three months to January 2018.”

“Higher levels of profitmaking sales were driven by a 90 basis point rise in the house segment, and a 180 basis point jump across the unit segment over the quarter.”

She said the highest rate of loss-making sales in Brisbane was across the Brisbane Council, where 11.9 per cent of resales saw a loss.

“The median loss across Brisbane Council was $35,000, 64.7 per cent of these were investor owned units.”

Somerset LGA delivered the highest rate of profitmaking sales, with 96.6 per cent of resales making a nominal gain, making $17.5 million in profit, or about a median takeaway of $102,000 per profitable sale.

The data showed around $38.11m worth of losses were accumulated in the Brisbane LGA during the quarter, or about 11.9 per cent of resales in the area. But Brisbane also made up the vast bulk of profits, at $1.93 billion, meaning homeowners made a median profit of $240,000 in the June quarter.

Ms Owen said the gap between profitmaking house resales and units was high, 98 per cent and 72.6 per cent respectively.

“Thus, while profitability in the unit market of Brisbane is improving, the gap in profitmaking resales is the second highest of the capital city markets (behind Darwin).

https://www.couriermail.com.au/property/brisbane-homeowners-rake-in-a-billion-dollars-in-profit-a-month/news-story/798fee79227008db5fdae18adb45811b