Property riches: Rotorua lifestyle block earns $865,000 resale profit

Nearly 100 per cent of Rotorua homes sold in the first quarter of 2019 sold at a profit. Photo / File

A Rotorua lifestyle block sold this year for $1.17 million has reaped $865,000 in resale profit, new data has revealed.

CoreLogic's latest Pain and Gain report showed the sale made the largest profit of all Rotorua properties sold between January 1 and March 31.

The $865,000 profit was made on a home on 28ha of land in Ngongotahā Valley, which was bought for $305,000 25 years ago and sold for $1.17m this year.

The report revealed more than 99 per cent of Rotorua property resales during the first quarter of 2019 made a profit.

Residents made a median profit of $196,000 per property, while the city's gross profit from sales was $39,546,121.

Only one home in Rotorua sold at a loss of $58,000, which was a home in Pomare purchased in March 2017 for $307,000 and resold in February 2019 for $249,000.

CoreLogic senior property economist Kelvin Davidson. Photo / File

CoreLogic senior property economist Kelvin Davidson said the drive in resale profits was not surprising as house prices in the city continued to rise.

"You can sell for a resale profit above the original price even after holding the property for a short time," he said.

Tremains Bay of Plenty and Waikato general manager Anton Jones said population growth had contributed to Rotorua's resale gains.

General manager of Tremains Bay of Plenty and Waikato, Anton Jones. Photo / File

People who cannot afford to live in Tauranga tend to buy in outlying areas, Jones said.

"It is called the halo effect," he said. "Rotorua is still a desirable place to live. People want their own piece of paradise."

OneRoof editor Owen Vaughan said people did not buy houses to make a quick profit but looked for affordability.

"It is their biggest purchase," he said. "It is about making sure their biggest purchase is going to be worth what they paid for it."

For people whose home value was not reflected in the sales price, Vaughan said, "Don't panic.

"If you have managed to take down a chunk of your mortgage, it means you might have enough change to stretch into your dream home."

Craig McFadyen and wife Teneille bought their first home in Pukehangi in 2005.

The couple had just got married and moved back to Rotorua, where they both grew up.

"It's been a great home over the years," McFadyen, the principal at Ngongotahā Primary School, said. "We have raised our two sons [Matthew, 9, and Joshua, 8] in it and have hundreds of good memories there."

Ngongotaha Primary School principal Craig McFadyen sold the home he bought in 2005 this year. Photo / Stephen Parker

McFadyen said he and his wife bought their single-storey, three-bedroom home on Hodgkins St for the "great neighbourhood, quiet cul de sac, brilliant neighbours".

"It was close to the park for the kids and the dog and it is a really good house to entertain friends," he said.

On May 6 this year, the couple put their family home on the market.

"We just needed something bigger. The boys are growing up and we need the second living area," McFadyen said.

Two days later on May 8, the couple had an offer on their home and it went unconditional on May 24.

Craig McFadyen

"It sold immediately," McFadyen said, and it also sold at a profit.