Is it Possible to Avoid Reselling at a Loss?
In an article for the website Your Investment Property, Miriam Bell sheds light on the losses made on property resales in recent times. It is any property investor’s wish to make as much profit on the sale as he/she can and thus it may be unwise to remain ignorant of the trend, argues Bell.
Nine-tenth of resales registered profits
It is worth noting that 90.2% resales registered profit over the first quarter. Of the 9.8% which made losses, lifestyle regions have suffered most. Richmond is NSW’s biggest casualty. Another evaluation concludes that it is the units and not the detached houses which are making the bigger losses and are reselling at a loss more frequently.
Regional areas and capital cities; both doing better
It is heartening the losses on resales have come down over the last year, both across capital cities and the regional markets. Sydney, Illawara, Central West and Central Coast have recorded least loss-making property resales.
Need bigger profits: hold your properties
RP Data Research Analyst Cameron Kusher says (and Bell quotes) that the length of time for which you keep the property is directly proportional to the profit you make on it. 19 out of 20 properties held for more than 15 years give at least a 100% return.
The same returns are fetched by nearly 55% of the properties held for 10-15 years. Even the contrast is worth taking a look at. Close to 20% of properties sold between 3-5 years resell at a loss.
You can read the original article here.
Investing worthier than speculating
While speculators can still make merry with a chance ‘flip’ here and there, renovating a fixer-upper and selling it in a blink is not the best strategy by consensus. In my opinion, property investment is still a better route to real estate success than property speculation. This is exactly why you are advised to hold a good part of your portfolio for long. After all, there is nothing like factoring in ‘time’ to make profits.
What hold:sell ratio do you keep for your portfolio?