Is now the right time to re-sell your property?

When you are in the property market you may face a dilemma of whether to sell or hold on to your home for a while longer. It is common to get confused when the best time is to sell due to all the differing opinions. The latest figures by RP Data, a well respected property research group, for the three months from September 2013 may provide a clearer picture if now is the right time to re-sell property.

Over the third quarter of 2013 only 11.1% of property re-sales nationally recorded a gross loss from their original purchase price. On the other side it means that almost nine in every ten homes sold for more and banked a healthy profit.

Another key factor to consider is the duration you have owned the property. RP Data suggests, that despite the possibility of unforeseen risks, a long term investment is usually the most successful. Of all re-sales that incurred a gross loss, their average length of ownership was just 5.2 years. Properties that recorded a gross profit were held for a mean of 9.7 years, while those homes that recorded a gross profit of more than 100% were owned for an average of 15.8 years.

Historically it has shown that a quick buy and sell has proved to have a negative cash effect. Even though home values have risen over the past year, 17.6% of owners who purchased and sold in the same year made a loss. However the greatest proportion of loss making sales have occurred across those homes re-sold after three to five years (20.2%).

To prove the point that patience is required 56.2% of homes re-sold between 10 and 15 years after purchase sold for double the purchase price and 94.0% of resales after 15 years were for more than twice the initial purchase price.

It is important to note the impact the GFC has had. Of the dwellings that were previously purchased prior to January 1st, 2008 (pre-GFC) 6.6% made a gross loss in the quarter. But a huge 20.1% of properties purchased after have produced a negative investment.

These are just statistics for the three months from September 2013 so it should be noted that they do not reflect the whole picture. We always recommend the more research you do the better but hopefully this helps in giving you a better understanding about what you should do with your property if you are uncertain.