The vast majority of Illawarra home owners made a six-figure profit by re-selling their property during the September quarter, new figures show.
Australian home sellers continue to see rising rates of profitability despite slowing market conditions, declining capital growth, and lower clearance rates.
That's according to CoreLogic's latest Pain and Gain report.
Read more: The Illawarra's most expensive and affordable housing suburbs revealed
Sellers making a profit
In the September 2024 quarter in the Illawarra, 97.1 per cent of re-sales were profit-making sales.
These owners had a median ownership period of 9.1 years and made a median gross profit of $395,000.
This gross profit totalled more than $476 million.
Of the 2.9 per cent of re-sales that were loss-making transactions, owners had a median ownership period of 2.4 years and a gross loss of $48,750.
CoreLogic's head of research, Eliza Owen, said the rate of profit-making re-sales in the Illawarra being 97.1 per cent in the September quarter matched the same percentage as the previous quarter.
At the same time last year, this figure was 97.6 per cent.
The latest median gross profit of $395,000 is up from $389,000 in the previous quarter and was $392,000 at the same time last year.
"The Illawarra is still delivering reasonable gains," Ms Owen said.
"But it's likely the sellers who made a profit in the September quarter had maybe held on to their property for a longer period of time and were realizing slightly higher median gains.
"And the sellers who had loss-making sales, 2.9 per cent of sellers, [they] had a relatively low hold period.
"It could be a reflection of the people who locked in low fixed rates in mid-2022 or early 2022, who are now rolling over into the high interest rate environment, and which may be motivating a sale."
The year ahead
Ms Owen said 2025 could see slightly lower returns for home sellers.
"At the moment, we might expect to see a slightly lower rate of profit-making sales," she said.
"The reason for that is because in the three months to November, home values across the Illawarra fell 0.6 per cent.
"It's not much, but it does mean that recent re-sellers, in particular, have slightly more chance of making a loss if they sell in a falling price environment."
National outlook
The report analysed 95,000 re-sales nationally over the quarter and showed the median gain was $295,000.
Ms Owen said the national results can be attributed to growth of 0.8 per cent in national home values through the quarter on top of reasonably strong housing demand conditions.
She also pointed to a strong prudential lending environment as a possible factor.
"A decline in home values is only a problem for sellers if they have issues servicing home loan repayments, or are in some other circumstance where they need to sell," she said.
"Otherwise, home owners can simply hold their properties back from the market until such time there is stronger buyer demand.
"That being said, there are still clearly pockets of pain where home sellers need to offload their property in spite of weak market conditions, or values remaining substantially below previous record highs."
