{"id":10659,"date":"2017-03-02T15:00:00","date_gmt":"2017-03-02T04:00:00","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=10659"},"modified":"2017-03-02T15:00:00","modified_gmt":"2017-03-02T04:00:00","slug":"average-capital-gain-a-quarter-of-a-million","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/average-capital-gain-a-quarter-of-a-million\/","title":{"rendered":"Average capital gain a quarter of a million"},"content":{"rendered":"

In his column for\u00a0Switzer<\/a>, John McGrath\u00a0analyses the latest\u00a0Pain & Gain report form CorleLogic.<\/strong><\/p>\n

Here’s what he had to say:<\/h4>\n

CoreLogic\u2019s latest\u00a0Pain and Gain Report<\/em>\u00a0shows nine out of 10 homes re-sold during the September 2016 quarter were sold at a higher price than their original purchase price, with an average gross capital gain of $262,672.\u00a0\"mcgrath\"<\/a>
\nThe report makes it very clear that the longer you hold a property, the more likely you are to sell for a decent capital gain.
\nAcross Australia, homes that re-sold at a loss had an average hold period of 6.1 years for houses and 6.5 years for apartments.
\nConversely, homes that re-sold for a profit were held for an average of 9.1 years for houses and 7.6 years for apartments.
\nBuying and holding is the key to wealth creation in real estate, no matter what type of property you own. \u00a0\u00a0\"building_night_28_05\"<\/a><\/strong>
\nHistorically, houses have typically done better than apartments in terms of average capital gains but it\u2019s interesting to note that in Sydney, a change to this long term trend is afoot.
\nThe CoreLogic report notes that over the past two years, there has actually been more re-sales at a loss among houses than apartments (although the proportion of homes selling at a loss is extremely low in both the houses and apartments categories).
\nFor example, in the September quarter, the proportion of Sydney houses re-selling at a loss was 2.5% and the proportion of apartments was 1.9%.<\/p>\n

This reflects rising demand for apartments in Australia\u2019s most expensive city.<\/h4>\n

This trend will continue as Sydney property gets more expensive and affordability constraints restrict more people to apartments.
\nBut given apartments are less expensive, they have more room for capital growth, too.\u00a0\"SydneyTerraces\"
\nEither way, the main point is you should do well with any type of property if you buy in a good location and hold for the long term.
\nAmong those homeowners who sold at a loss, the average loss was $71,529.
\nThe end of the mining boom is making a significant contribution here, with the highest proportion of loss-making sales across our capital cities recorded in Darwin and Perth.
\nThis is an important lesson, particularly for investors, that it\u2019s never a good idea to buy in a town solely or largely dependent on one industry.
\nAcross the capital cities, the proportion of loss-making re-sales are as follows:<\/strong><\/p>\n

    \n
  • Sydney: 2.3%\u00a0\"map<\/li>\n
  • Melbourne: 4.9%<\/li>\n
  • Adelaide: 7.2%<\/li>\n
  • Hobart: 8.4%<\/li>\n
  • Brisbane: 8.5%<\/li>\n
  • Canberra: 12.2%<\/li>\n
  • Perth: 19.6%<\/li>\n
  • Darwin: 30.7%<\/li>\n<\/ul>\n

    So, why would people sell at a loss?<\/p>\n

    There are many typical scenarios with loss-making re-sales, including:<\/h4>\n
      \n
    • Selling too soon after purchase for personal reasons, such as a work transfer or expanding your family and needing more space<\/li>\n
    • Selling at the wrong time in the market cycle, for example buying at the height of a boom and selling too soon when the market is softening (again, this usually happens when the re-sale is prompted by personal reasons)<\/li>\n
    • Investors who enter the market in good times (i.e. during a boom and\/or when interest rates are low) who then sell too soon because they have not sufficiently prepared themselves for rising mortgage rates or ongoing hold costs over the long term<\/li>\n<\/ul>\n

      \"house
      \nHolding for the long term will definitely determine whether you sell for a loss or gain.
      \nThe level of loss or gain usually comes down to time in the market and the location of your property.
      \nHere are the\u00a0Top 5 council districts in the major East Coast capitals<\/strong>\u00a0where properties recorded the highest re-sale gains.
      \nI\u2019ve included the average hold periods so you can see how much time these sellers needed to hold their properties in these locations to achieve such impressive capital gains.<\/p>\n

      Sydney<\/h4>\n
        \n
      1. Hunters Hill \u2013 Median profit $785,000 (median hold period 8.9 years)<\/li>\n
      2. Ku-ring-gai \u2013 $733,500 (6.3 years)<\/li>\n
      3. Woollahra \u2013 $670,000 (6.6 years)<\/li>\n
      4. Manly \u2013 $636,500 (7.4 years)<\/li>\n
      5. Willoughby \u2013 $625,000 (8.3 years)<\/li>\n<\/ol>\n

        Melbourne<\/h4>\n
          \n
        1. Boroondara \u2013 Median profit $574,750 (median hold period 10.8 years)<\/li>\n
        2. Bayside \u2013 $555,750 (9.4 years)<\/li>\n
        3. Manningham \u2013 $524,000 (9.6 years)<\/li>\n
        4. Whitehorse \u2013 $480,000 (11.3 years)<\/li>\n
        5. Monash \u2013 $415,500 (9.5 years)<\/li>\n<\/ol>\n

          Brisbane\/Gold Coast<\/h4>\n
            \n
          1. Brisbane \u2013 Median profit $173,250 (median hold period 9.3 years)<\/li>\n
          2. Gold Coast \u2013 $110,000 (8.6 years)<\/li>\n
          3. Redland \u2013 $110,000 (9.2 years)<\/li>\n
          4. Sunshine Coast \u2013 $98,000 (8.9 years)<\/li>\n
          5. Logan \u2013 $94,500 (9.2 years)<\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"

            In his column for\u00a0Switzer, John McGrath\u00a0analyses the latest\u00a0Pain & Gain report form CorleLogic. Here’s what he had to say: CoreLogic\u2019s latest\u00a0Pain and Gain Report\u00a0shows nine out of 10 homes re-sold during the September 2016 quarter were sold at a higher price than their original purchase…<\/p>\n","protected":false},"author":176692471,"featured_media":9073,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[13],"tags":[],"class_list":["post-10659","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latest-story"],"yoast_head":"\nAverage capital gain a quarter of a million - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/average-capital-gain-a-quarter-of-a-million\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Average capital gain a quarter of a million - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"In his column for\u00a0Switzer, John McGrath\u00a0analyses the latest\u00a0Pain & Gain report form CorleLogic. Here’s what he had to say: CoreLogic\u2019s latest\u00a0Pain and Gain Report\u00a0shows nine out of 10 homes re-sold during the September 2016 quarter were sold at a higher price than their original purchase...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/channels.realty.com.au\/realtytalk\/average-capital-gain-a-quarter-of-a-million\/\" \/>\n<meta property=\"og:site_name\" content=\"Realty Talk\" \/>\n<meta property=\"article:published_time\" content=\"2017-03-02T04:00:00+00:00\" \/>\n<meta name=\"author\" content=\"rolanrush\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rolanrush\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/\"},\"author\":{\"name\":\"rolanrush\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"headline\":\"Average capital gain a quarter of a million\",\"datePublished\":\"2017-03-02T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/\"},\"wordCount\":666,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"articleSection\":[\"Latest Stories\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/\",\"name\":\"Average capital gain a quarter of a million - Realty Talk\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"datePublished\":\"2017-03-02T04:00:00+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#primaryimage\",\"url\":\"\",\"contentUrl\":\"\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/average-capital-gain-a-quarter-of-a-million\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Average capital gain a quarter of a million\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\",\"name\":\"Realty Talk\",\"description\":\"Your Trusted Voice For Property Investing. 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