property gains
Almost all property resales saw gain during the last quarter. Image – Canva.
  • Resale gains at highest level in ten years
  • 106,000 dwelling resales occurred during the June quarter, according to CoreLogic
  • While gains were made in Sydney, the picture was different in Perth, Darwin and Melbourne

Thanks to record low mortgage rates, tight listings and the extraordinary level of growth in Australian house values, resale gains for vendors remain strong, particularly in certain tree change and regional areas.

CoreLogic’s Pain & Gain report shows that 91.5% of resales during the June quarter recorded a nominal profit-making gain compared to the previous purchase price. This represents the highest level of profitability in over ten years.

Eliza Owen, CoreLogic’s head of research, said that for four consecutive quarter, profit-making residential property sales have increased.

The report is based on 106,000 dwelling resales during the June quarter – a 9% increase compared to March 2021.

“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 median hold period on resales was 8.8 years, with a median national gross resale profit was $265,000.

For those making losses, the median was -$43,000.

Thanks to the recent growth in the housing market, property owners who were reselling after only two years could expect to pocket a median return of $123,000.

“For those cashing in after over 30 years of holding a property, the median return was $712,000,” she said.

Eliza Owen
Eliza Owen. Image – LinkedIn.

“Such high levels of profitability may start to encourage vendor participation and bring down typical hold periods, especially as major cities navigate a path out of 2021 lockdowns.”

Eliza Owen, CoreLogic head of research

Ballarat in regional Victoria recorded the highest rate of profitability, with 99.7% of resales recording gains.

The entire regional Victoria dwelling market saw 98.7% of resales above the purchase price.

“Impressive returns were not confined to just Victoria, as 97.6% of Sydney house resales achieved a level of gain, the highest level of profit-making resales since 1982,” Ms Owen added.

However, Ms Owen warned that many pockets nationally saw dwellings were gains were less prevalent – such as Perth (63.5%), Darwin (39.3%) and Melbourne (34.8%).

“Even markets with relatively elevated levels of loss-making resales saw vast improvement through the June quarter, as the rate of loss-making resales declined -4.6 percentage points across Perth in the June quarter, and -4.7 percentage points across Darwin.”

Last week, the Australian Bureau of Statistics (ABS) announced that household wealth across Australia had increased to over $13 trillion – thanks to increased housing values.

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