New research from CoreLogic shows 91.5% of resales during the June quarter recorded a profit, the highest level of profitability in a decade.
The Pain and Gain Report analysed data from 106,000 real estate re-sales, and showed that tight listings, record low mortgage rates and Australia's extraordinary growth in housing values led to continued strong resale gains.
Property owners who resold after just two years pocketed a median return of $123,000, while those cashing in after more than 30 years of holding a property, achieved a median return of $712,000.
CoreLogic’s Head of Research Eliza Owen, says nationally, profit-making residential property sales have increased for four consecutive quarters, with the latest report showing profitability is at a ten year high.
"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 resales for the quarter was 8.8 years, with a national median gross resale profit of $265,000.
Regional sellers cash in
Re-sale gains were particularly strong in the country's regional and tree change markets.
Record high rates of profitability extended to regional Victoria's entire dwelling market, where 98.7% of resales were above the purchase price.
The regional push has exploded through the pandemic, but has proven challenging for some renters, especially in popular coastal markets.
Fresh worries for lockdown renovations
According to Hipages data, those stuck at home in lockdowns have been prioritising renovations.
However, with this surge in spending in lieu of supply shortages has seen prices skyrocket.
According to the report, labour costs have gone up as a result, with builders, painters, concreters, tilers and garden maintenance workers having the biggest increase in requested jobs since July.
There has been an average 35% price increase for extension, 18% for kitchen renovations, and 15% for bathroom overhauls.
Average spend on renovations over the past year has also increased 5% to $21,000.
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Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.
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| Variable | More details | ||||||||||||
| FEATUREDUNLIMITED REDRAWSSPECIAL OFFER | Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)
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Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)
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| Variable | More details | ||||||||||||
| FEATUREDAN EASY DIGITAL APPLICATION | Neat Variable Home Loan (Principal and Interest) (LVR < 60%)
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Neat Variable Home Loan (Principal and Interest) (LVR < 60%)
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| Variable | More details | ||||||||||||
| FEATURED100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES | Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)
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Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)
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| Variable | More details | ||||||||||||
| NSW/VIC/SA METRO & INNER REGIONAL AREAS$5000 CASHBACK. T&Cs APPLY. | Variable Home Loan (Principal and Interest)
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Variable Home Loan (Principal and Interest)
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- Fast turnaround times, can meet 30-day settlement
- For purchase and refinance, min 20% deposit
- No ongoing or monthly fees, add offset for 0.10%
Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of May 29, 2022. View disclaimer.
Image by Kitera Dent via Unsplash
