Sydney's stay-put homeowners

HOMEOWNERS are not moving as often as they did a decade ago.

HOMEOWNERS are not moving as often as they did a decade ago.

Perhaps it's due to the stamp duty fees, maybe it's the renovation revolution, or it might just be because moving house is stressful. But Australian homeowners are remaining in their houses longer.

Our grandparents might have spent the greater part of their adult lives at one address but a recent study undertaken by RP Data's research analyst, Cameron Kusher, showed the average length of home-ownership for both houses and units was 9.3 years and 8.2 years respectively. A decade ago the figures sat at 6.8 years and 5.9 years.

On average, Sydneysiders are now staying in their houses for 10.1 years and in units for
8.2 years.

"The average hold period for houses and units remained relatively static until late 2005 -- it has, however, increased consistently from this time where we have seen a sharp rise in length of time homes were held for recent years,'' Mr Kusher said.

"An increase in holding periods is logical when measured against the decline in sales. Added to this is the fact that the population has continued to grow given that homes values have risen.

"As a result, transaction costs such as agent commissions and stamp duty have also increased. There is no incentive for homeowners to move more frequently,'' he said.

Tim McKibbin, CEO of the Real Estate Institute of NSW, said it was up to the state government to "remove the disencentives'' around buying and selling real estate.

"Stamp duty is undoubtedly one of the main reasons behind these extended hold periods,'' he said.

"What you'll find today is that for a lot of people, if their home no longer meets their requirements then they just renovate, or do a knockdown rebuild. In many cases it's cheaper to do that than move,'' he said.

But when it comes to older generations, such as retirees who want to downsize, Mr McKibbin said some homeowners feel stuck.

"In some circumstances they have no income. If they want to move into a smaller property they're just tearing up money in taxes,'' he said.

But before we give up ever calling the removalists again,

L Janusz Hooker, deputy chairman of LJ Hooker, said the RP Data study did not represent a fundamental ``shift in the psyche of Australians'', but rather a reflection of where we are in the post-boom market.

"From about 1995 to 2009 there was unprecedented capital appreciation in Australian property,'' he said.

With an annual compound growth of about 8 per cent for residential real estate in most capital cities, Mr Hooker said some homeowners saw their property values double over that time period.

In its recent Pain and Gain report for the December quarter, RP Data recorded that 26 per cent of Sydney homes sold for more than double their purchase price during that period. However, the average hold period for those properties was 17.2 years.

"Back then, when people were making huge gains I don't think that stamp duty was a major concern. You almost couldn't lose; a 5 per cent tax for them was neither here nor there,'' Mr Hooker said.

"But after the 2010 peak in capital city property prices, the market has stalled and in some areas values are down 5 per cent -- so since then homeowners have been sitting on their hands,'' he said.

Hesitant to talk about a possible return to the 1990's pastime of flipping property for profit, Mr Hooker said hold periods would most likely begin to shorten as confidence in the market increased.

"But if you really want to make quick money in property, you're better off buying real estate company shares,'' he said.

HAPPY NINE-YEAR RESIDENCE OVER

Brian Edmonds and Dilys Tan bought their Naremburn house almost nine years ago and are now selling.

"Well, there are a number of reasons why we're selling now,'' Mr Edmonds said.

"One of which is because I travel a lot for work so we wanted to be in a smaller place with less maintenance,'' he said.

Mr Edmonds, who is an award-winning film and television art director, said the notion of selling in the wake of the GFC had no doubt held some vendors back, but he was confident that his house at 43 Station St, Naremburn had held, and now gained, value.

According to RP Data Naremburn's median house sale price is currently $742,000 to $1.4 million.

PUTTING DOWN ROOTS

Sydney suburbs where people have stayed put the longest:
HOUSES
Suburb ............ Amount ...... Years
Rodd Point ...... $1.15m ...... 18.3
Ultimo ............. $837,500 .... 16.6
Kensington ...... $1.415m .... 15
Abbotsford ...... $1.221m ..... 14.9
Church Point ... $1.1525m ... 14.8

UNITS
Suburb ............. Amount ...... Years
Lavender Bay .... $629,000 .... 13.9
Wetherill Park ... $318,500 .... 12.8
Gymea Bay ...... $730,000 .... 12.4
Dural ................ $535,000 .... 12.3
Russell Lea ....... $590,000 ... 12.2