Who are the winners in real estate in Australia

Discussing real estate in Australia is just about a national past time. With every news outlet and talking about price rises, rental cost reductions or negatively geared investment properties, it's almost like talking about something as ubiquitous as the weather. However, not all property markets across the country are created equal and some will naturally perform better than others. The latest CoreLogic RP Data Pain and Gain report shows who the biggest winners (and losers) were for the first quarter of the year.

Real estate in Sydney

It's hard to talk about successful property sales without talking about the Harbour City, and the Pain and Gain report shows us just why this is. According to the research, 97.3 per cent of houses sold in the New South Wales capital made a profit, as did 98.1 per cent of units.

While other markets for freestanding homes may have been close, those looking at apartments at rental properties for investment would do well to look at Sydney. The 1.9 per cent of sales recording a loss is not only the lowest proportion out of all the capital cities, it is the only figure not in double digits. It seems that vendors with houses for sale in Sydney will continue to do well, especially as the Real Estate Institute of Australia confirms that prices continue to rise.

"In the March quarter, the median house price in Sydney reached the $900,000 mark and is now well above it. At $929,842, Sydney has the highest median house price amongst the Australian capital cities," said REIA president Neville Sanders.

Houses for sale in Perth

Perth, and Western Australia in general, may not spring to mind when real estate success is thought of, as a result of the decline in mining activity. However, CoreLogic RP Data's figures show that both the state and its capital had some exceptional performance over the first quarter of the year.

The ratio of profit-making sales in Perth exceeds that of Brisbane, Adelaide, Hobart, Darwin and Canberra, putting it just behind Melbourne and Sydney. However, where the western-most capital shined was the proportion of sales that exceeded 100 per cent return to the owner. Over 42 per cent of sales in Perth in the March quarter resulted in owners doubling their investment or better, ahead of the next best capital city, Melbourne, at 38.9 per cent, and Sydney at 32.3 per cent.

The rest of Western Australia held its own too, showing that the residual value from the resource phase of the economy is still a factor. Of all the regional areas, Western Australia had the highest proportion of 100 per cent or more profit-making sales at 44.1 per cent.

Investors in Melbourne

The Victorian capital did well for owner-occupiers, with an 8.1 per cent proportion of loss-making sales, according to the Pain and Gain report, but wasn't as kind to investors at 9.9 per cent. Real estate in Melbourne isn't unique in this regard though, as owner-occupied properties across the country had a higher chance of selling for a profit than those owned by investors.

This could likely come down to two factors. The first being that the rental properties owned by investors may not, generally speaking, be as well maintained or desirable as those bought to live in. Across the board, this is why these kinds of properties could be cheaper to invest in in the first place. However, more likely is the fact that owner-occupiers tend to move house less often than investors buy and sell to diversify their portfolios.

Nationally, properties that were sold at a loss were held for around 5.7 years by their owners, while those that made a gain where kept for an average of 10.3 years.