Recent data from CoreLogic shows that 9 out of 10 properties in the latest quarter sold for a price higher than the original purchase price, raking in a gross profit of $18.7 billion collectively for the quarter alone.
CoreLogic head of residential research Eliza Owen said Hobart sellers were the most likely to experience gains, with 98.1% of properties selling for a profit.
“Hobart has experienced particularly large capital gains over the past five years and this has translated into exceptionally strong results for resellers of both houses and apartments during the past quarter,” she said.
Other areas that experienced a particularly high number of profitable resales were regional Victoria (96.6%) and regional Tasmania (96.4%).
Most capital cities saw significantly more profit making resales than losses, with the exception of Darwin where it was split almost 50/50.
Over the quarter, 11.1% of properties owned by owner occupiers resold at a loss compared to 16.6% of investment properties.
“Clearly, any property owner will aim to make a profit from the sale of their property. In a falling market, owner occupiers may be more prepared to sell at a loss if they are purchasing their next home at an equivalent or greater discount,” the report said.
“Conversely, investors, because of taxation rules, would seemingly be more prepared to incur a loss because they (unlike owner occupiers) can offset those losses against future capital gains.”
Nationally, 88.9% of owner occupied properties resold for a profit compared to 83.4% of investor owner properties.
Ms Owen said the strong housing markets in Hobart and regional Tasmania has also helped investor owners, who are more likely to sell at a loss than owner occupiers, to buck the trend and enjoy greater gains than in these regions.
“When it comes to generating a profit for the seller, owner occupied properties have outperformed investment properties in all markets except for Hobart and regional Tasmania,” she said.