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Real estate agents have been saying this for years and it’s been shown again by the most recent data from the CoreLogic Pain and Gain report for the September 2015 quarter.
Across the country, homes which were resold for a loss had an average ownership of just 6.0 years. If these property owners had held onto their homes for a few mores years then they may have had a little more luck, with homes sold for a gross profit held onto for an average of 10.1 years.
But if you really want to see your home’s price skyrocket then you might need to hold onto your home for even longer, with 16.9 years being the average years of ownership for homes that sold for more than double their purchase price.
Of course time isn’t the only factor in making profit in real estate, other equally important factors include the type of property and the location.
The report found that properties in capital cities were less likely to sell at a loss when compared to properties in regional areas.
Conditions in most regional areas are fairly flat right now, however this is not the case for most of our capital cities, with Sydney, Melbourne and Brisbane recording the lowest proportions of loss making resales.
Just 1.7% of resales (a record low) in Sydney were recorded at a loss, compared to 5.4% in Melbourne and 7.6% in Brisbane.
Unfortunately for Perth and Darwin, their loss-making resales are on the increase, while Adelaide and Canberra remained flat and recorded little movement.
It’s very unlikely that we will see loss making resales plummet to zero, but 1.7% is an extremely low percentage given that the previous low recorded by CoreLogic in its 15-year history was 2.3% in 2004.
If you would like to read the full Pain and Gain report for September 2015, click here.