More loss, less profit for short term property holders
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More loss, less profit for short term property holders

Property owners who bought within the past two years cut their losses as the heat comes out of the market and interest rates bite

Fri, Sep 22, 2023 11:52amGrey Clock 2 min

The number of Australian properties selling at a loss is on the increase, new data from CoreLogic has shown.

The CoreLogic Pain & Gain report for the June quarter revealed sales of properties sold within two years of purchase showed a significant rise in the number of those selling at a loss, up 9.7 percent compared with 2.7 percent a year ago.

CoreLogic Head of Research and report author Eliza Owen said the results reflect the turbulence of the past two years, with the market impacted by COVID and increases in the cash rate.

“Two years is a significant time period because we are two years on from the height of pandemic-related lockdowns, low interest rates, and have just passed the peak of transitions from low fixed rates to high variable rates,” Ms Owen said. 

“The portion of homes sold within just two years increased by one percentage point to 8.5 percent over the past year, however the portion of these short-term resales where the seller incurred a loss has increased more substantially, from just 2.7 percent a year ago to 9.7 percent in the June quarter. 

“This suggests more sellers are willing to incur a loss at the moment, which could in part be the result of high interest rates.” 

The losses were felt in far greater numbers by owner/occupiers, who made up 72.1 percent of short term resales, compared with 27.9 percent for investors. Vendors in regional areas were also more likely to be feeling the pain, an indication that the treechange love affair is over for some.

“Around one in 10 regional Australian property sales were held for only up to two years,” Ms Owen said. 

“A further breakdown of this data by SA4 regions shows some of the highest concentrations of short-term resales were in parts of regional Queensland, including Wide Bay (17.3 percent), the Gold Coast (15.2 percent) and the Darling Downs – Maranoa region (14.4 percent). This suggests that people might be selling up after trying to live, or invest, in more remote regional or lifestyle areas.” 

In good news for potential investors, Ms Owen said the outlook for home values this year was positive.

“The rate of profit-making sales tends to follow capital growth trends,” she said. “With home values continuing to rise through July and August, we estimate the level of profitability from resales will also move higher through the September quarter.” 


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A new AI-driven account by leading landscape architect Jon Hazelwood pushes the boundaries on the role of ‘complex nature’ in the future of our cities

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Drifts of ground cover plants and wildflowers along the steps of the Sydney Opera House, traffic obscured by meadow-like planting and kangaroos pausing on city streets.

This is the way our cities could be, as imagined by landscape architect Jon Hazelwood, principal at multi-disciplinary architectural firm Hassell. He has been exploring the possibilities of rewilding urban spaces using AI for his Instagram account, Naturopolis_ai with visually arresting outcomes.

“It took me a few weeks to get interesting results,” he said. “I really like the ephemeral nature of the images — you will never see it again and none of those plants are real. 

“The AI engine makes an approximation of a grevillea.”

Hazelwood chose some of the most iconic locations in Australia, including the Sydney Opera House and the Harbour Bridge, as well as international cities such as Paris and London, to demonstrate the impact of untamed green spaces on streetscapes, plazas and public space.

He said he hopes to provoke a conversation about the artificial separation between our cities and the broader environment, exploring ways to break down the barriers and promote biodiversity.

“A lot of the planning (for public spaces) is very limited,” Hazelwood said. “There are 110,000 species of plants in Australia and we probably use about 12 in our (public) planting schemes. 

“Often it’s for practical reasons because they’re tough and drought tolerant — but it’s not the whole story.”

Hazelwood pointed to the work of UK landscape architect Prof Nigel Dunnett, who has championed wild garden design in urban spaces. He has drawn interest in recent years for his work transforming the brutalist apartment block at the Barbican in London into a meadow-like environment with diverse plantings of grasses and perennials.

Hazelwood said it is this kind of ‘complex nature’ that is required for cities to thrive into the future, but it can be hard to convince planners and developers of the benefits.

“We have been doing a lot of work on how we get complex nature because complexity of species drives biodiversity,” he said. 

“But when we try to propose the space the questions are: how are we going to maintain it? Where is the lawn?

“A lot of our work is demonstrating you can get those things and still provide a complex environment.” 

At the moment, Hassell together with the University of Melbourne is trialling options at the Hills Showground Metro Station in Sydney, where the remaining ground level planting has been replaced with more than 100 different species of plants and flowers to encourage diversity without the need for regular maintenance. But more needs to be done, Hazelwood said.

“It needs bottom-up change,” he said. ““There is work being done at government level around nature positive cities, but equally there needs to be changes in the range of plants that nurseries grow, and in the way our city landscapes are maintained and managed.”

And there’s no AI option for that. 


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