NZ growth in property resale profit
New date by CoreLogic has shown that due to the buoyant conditions of New Zealand’s property market in recent years, there’s been an increase in the number of homeowners who are selling their properties for profit.
In march this year, CoreLogic released a report saying that in the first quarter of 2017, a whopping 96.3% of property resale saw a gross profit when compared to the previous sale price. The report stated an average profit of $167,000 per sale, making that close to $4 billion pocketed across the country.
‘Strong, long-term growth in national values is behind the reduction in properties reselling at a loss” said Nick Goodall, CoreLogic’s head of research.
Goodall also added that whilst an increase in the price of property makes it likely that profits will stay up, some areas in New Zealand were performing better than others.
“But the market is not delivering the same gains for everyone, with some regions as well as apartment owners and property investors more likely to face a loss with resales,” he says.
The first quarter of 2017 had Christchurch with the most properties resold at a loss, followed by Dunedin, Auckland and Wellington. The same quarter, showed investors were more likely to be impacted by resales than owner-occupiers, with the exception of Hamilton, Tauranga and Dunedin where the resale loss difference between investors and owner-occupiers was minimal.
“Our analysis indicates investors occupy a riskier position in the market compared to owner occupiers, mainly due to the types of properties they buy and the parts of New Zealand they’re active in,” Goodall went on to say.