Gain or Pain: What Property Transactions Earned in Q2 2024
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In this blog post, we’re diving into insights from CoreLogic’s latest Gain and Pain Report, which highlights key trends in the property market for the quarter ending June 2024.
Source: CoreLogic
First off, let’s discuss some crucial numbers from the report. The median profit from property sales this quarter was $285,000, while the median loss was $40,000. Gains and losses were made with a median holding period of 8.8 years. Impressively, 94.5% of the 91,000 sales recorded were profitable in this latest quarter. The median profit has been on a steady upward trajectory over the past 28 years, with only a slight increase in the median loss.
Source: CoreLogic
Houses vs. Units
Now, let’s break down the comparison between houses and units. Houses continue to dominate the profitability game, boasting a loss-making sales rate of just 2.8%, compared to a staggering 10.6% for units. This disparity is consistent across both major capital cities and regional areas.
You might be wondering: what’s the median nominal gain from house sales? The answer is a whopping $340,000, nearly double the return at $185,000 from units. Interestingly, the median holding period for both houses and units is around 8.5 years. Clearly, owning a house offers a far superior probability of profiting, alongside higher actual returns.
Holding Period
Let’s look at holding periods a bit more closely. The median hold period for loss-making units is 9.1 years, compared to just 5 years for houses. In capital cities, the median hold period for loss-making units is even longer, at 9.5 years, compared to only 3 years for houses. That’s a significant difference and a long time to be holding onto a loss.
The average hold period for resales across Australia is 8.8 years. Here’s a surprising statistic: holding onto a property for up to 2 years can yield a median gain of $100,000 while holding for over 30 years can net you nearly $800,000. This highlights the power of compounding growth in property as a long-term asset class. The longer you hold, the better your potential returns!
Source: CoreLogic
Looking Ahead
Overall, profit-making sales are expected to continue rising, driven by increasing home values. However, the market may face challenges due to high interest rates, a tough cost of living, and issues surrounding affordability.
Summary of Key Points
94.5% of sales in the June quarter made a profit.
Houses outperform units significantly in terms of profitability.
Holding periods matter for your returns!
Thank you for reading! If you found this information helpful, feel free to share your thoughts and experiences in the comments below. Let’s keep the conversation going about the property market and how to navigate it successfully!
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The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any individual objectives, financial situation or needs. Before acting on this information, Premier Buyers recommends that you consider whether it is appropriate for your circumstances and engage qualified professionals.