Despite the negative sentiment surrounding the Sydney and Melbourne property markets at present, new data from CoreLogic has revealed that the major cities recorded massive resale profits in the three months to September 2018.
Figures from CoreLogic’s latest Pain and Gain report show that the vast majority of properties (88.9 per cent) across the country resold for a profit, resulting in $14.06 billion in profit.
Sydney and Melbourne contributed the most to this sum, accounting for 31 per cent and 24.7 per cent of total profits respectively.
Resale profits were however down for the quarter and at their lowest levels since the August quarter in 2013. It was found that 11.1 per cent sold at a loss at a cost of $488.1 million nationally.
“This is reflective of both the higher cost of housing in Sydney and Melbourne and the strong growth in dwelling values prior to the recent downturn, which has resulted in substantial profits. As a comparison, these two cities accounted for just 12.3 per cent and 7.4 per cent of the total value of losses nationally over the quarter,” said Cameron Kusher, CoreLogic analyst.
The profitability of Sydney and Melbourne even had a flow on effect to nearby regional areas, with some regions recording fewer resales at a loss than the capitals, according to CoreLogic’s report.
Overall the data showed that capital city markets recorded more resales at a profit than regional markets.
Sydney and Melbourne property are likely to continue leading the charge in profit making resales in the year ahead, despite slowing values in these cities.
Those who bought at the height of these markets would be wise to try and hold onto their properties as long as possible to weather out any drop in values, with predictions that the markets may bottom out in 2019.
Those who aren’t able to hold onto their properties may be able to add value to their properties in others ways such as renovating.
For the best advice about your particular situation though it is best to get in touch with your local Professionals agent.