The median hold period for properties selling at a loss was 6.7 years, CoreLogic reports
Nationwide short-term loss making property sales are rising, which suggests that more owners are questioning future gains, according to latest report from CoreLogic.
The median hold period for properties selling at a loss was 6.7 years, down from 8 years in the previous quarter, the report revealed.
CoreLogic Head of Research Nick Goodall said more people were selling over a shorter period and taking a loss was the result of the general market slowdown, and uncertainty about the future.
“The recent slowdown in value growth is an obvious factor. There’s also the potential for future costs to increase, including higher interest rates, or policies affecting investors.
“We know from consumer confidence surveys that house price expectations have weakened. This new data shows a higher number of people who bought in the past year are more cautious and choosing to sell earlier,” Goodall said.
Nationally, there was over $26 million in realised losses over the quarter, or almost $20,000 per sale. Investors were hit harder than owner occupiers, losing around $44,500 per sale.
In Auckland, the median hold period for loss making sales dropped to just one year during the June quarter, down from 2.3 years in the previous quarter.
“This means half of all Auckland properties selling at a loss were owned for less than a year,” Goodall said.
The report showed Christchurch, at 7.9%, experienced the greatest proportion of loss making sales over the quarter, which was due to values plateauing from out-of-cycle growth following the Canterbury earthquakes.
Despite the decrease in confidence among sellers, Goodall said he expects market growth to pick up around the middle of 2018.
“Interest rates are still very low, the flow of Kiwis returning home from abroad is an established trend, and new supply will continue to be constrained.
“But right now, there’s clearly a degree of caution among sellers who aren’t prepared to wait for values to start increasing again,” Goodall said.
The median hold period for properties selling at a loss was 6.7 years, down from 8 years in the previous quarter, the report revealed.
CoreLogic Head of Research Nick Goodall said more people were selling over a shorter period and taking a loss was the result of the general market slowdown, and uncertainty about the future.
“The recent slowdown in value growth is an obvious factor. There’s also the potential for future costs to increase, including higher interest rates, or policies affecting investors.
“We know from consumer confidence surveys that house price expectations have weakened. This new data shows a higher number of people who bought in the past year are more cautious and choosing to sell earlier,” Goodall said.
Nationally, there was over $26 million in realised losses over the quarter, or almost $20,000 per sale. Investors were hit harder than owner occupiers, losing around $44,500 per sale.
In Auckland, the median hold period for loss making sales dropped to just one year during the June quarter, down from 2.3 years in the previous quarter.
“This means half of all Auckland properties selling at a loss were owned for less than a year,” Goodall said.
The report showed Christchurch, at 7.9%, experienced the greatest proportion of loss making sales over the quarter, which was due to values plateauing from out-of-cycle growth following the Canterbury earthquakes.
Despite the decrease in confidence among sellers, Goodall said he expects market growth to pick up around the middle of 2018.
“Interest rates are still very low, the flow of Kiwis returning home from abroad is an established trend, and new supply will continue to be constrained.
“But right now, there’s clearly a degree of caution among sellers who aren’t prepared to wait for values to start increasing again,” Goodall said.
