A new report has revealed that the majority of property sellers are making a profit on their sales, despite the market’s recalibration due to rising inflation and higher mortgage costs.
Some 96% of owners who have sold recently made a profit on their transaction, according to researcher CoreLogic NZ in its residential Pain and Gain report, which monitors deals in 12-week cycles.
The average gain was $328,000, indicating that homeowners are still reaping the rewards of the property boom despite the recent turn in market mood.
CoreLogic revealed that this latest result was a 25% drop on the peak profit of $441,00, achieved at the height of market exuberance in the fourth quarter of 2021.
In the latest analysis, most of the properties that did sell at a loss had only been owned for a short period, less than 19 months on average.
The researcher’s chief property economist Kelvin Davidson said financial stress was a likely reason for some properties exchanging hands.
“Rising interest rates would be a clear candidate for driving some of these sales,” he said. “At the same time, other factors such as divorce or death can also drive unexpectedly short hold periods.”
All the main centres saw losses, but it was most acute in Auckland, where 6.9% of deals were underwater. Hamilton also saw more than 6% of resales at less than their previous purchase price.
If you’re considering putting your home on the market, these tips may help maximise your sale price.
Be patient
If the property market is slow, it pays to wait for the right buyer. Owners in a hurry often have to compromise on price.
Experience counts
Nothing beats the experience of a skilled agent to help you when the market gets tough. They’ll have seen every market condition and will know the best marketing strategies to attract buyers and then negotiate a great price.
Price competitively
Today’s buyers worry about paying too much. So, set your asking price in line with similar homes in your area. If you aim too high, your home will likely remain on the market. People will assume you’re asking too much or there’s something wrong with the property.
Wow factor
Ensure your home looks its best before putting it on the market. Complete necessary repairs, thoroughly clean and consider staging your home, where a consultant installs furnishings to make it look fantastic.
Pays to talk
While you might have a strong opinion on the value of your property, be open to negotiation. Buyers will always try to win the property for the lowest value, but finding a mutually agreeable price is often possible.