Gumtree Reveals Second-hand Economy Worth $40 Billion

The online marketplace recently released its annual report proving that the second hand economy is still worth big bucks.

Are you sitting on a hidden fortune? We’ve written before about spring cleaning your finances, but perhaps a spring clean of the cupboards might be in order too…

According to Gumtree Australia, more than 89% of Australians are hanging onto an average of 25 unwanted goods at home, which add up to about $5,200 per household if we sold them.

October is Buy Nothing New month, and the Second Hand Economy Report, commissioned annually by Gumtree, highlights the financial benefit of accessing the second hand economy market. The research reveals that the second-hand economy is now worth a staggering $40 billion dollars, a rise of more than $10 billion compared to 2015. It also revealed that more than 90% of people have already purchased at least one second hand item at some stage, and Gumtree is using these initiatives to encourage more Australians to tap into this market with buyers reporting savings of almost 50% on average.

Dr Rebecca Valenzuela, from the Department of Economics at Monash University said that the reported growth in participation and volume of exchanges is a clear indicator that the second hand goods market in Australia is a booming industry.

“Sites like Gumtree are quickly becoming an important channel through which Australian households can relieve financial strain, increase their consumption options and/or afford some goods that are otherwise out of reach,” she said.

“It makes sense for Australians to tap into this resource especially with, on average, $5,200 worth of unwanted items per household which could be sold and help clear debt and free up their hard-earned money for other things like family holidays, sports club dues or violin fees for their 7-year-old protégé.

“In addition to making some extra cash, buyers and sellers in this market feel proud to ‘do their bit’ for the environment through the second hand economy, while others enjoy the interaction and gaining a positive social experience in the process.”

Collecting dust?

Gumtree’s second hand economy report makes it clear that Australians are playing ball, with more than $84 million used goods sold in the last 12 months.

Studies suggest that 38% of those who sold unwanted items in the past year did so to combat the rise in the cost of living, service a debt or pay their rent. The report suggests that more than half (56%) of Australians have sold second hand goods in the last year.  Australians recognise that buying second hand items for the home has financial benefits, particularly when the money is put away for a holiday (52%), cover living expenses (45%) and reduce their personal debt (29%).

Buying second-hand?

We’ve previously written about all the awesome things you can buy at an op shop, and this boom in the second-hand economy is also presenting a great opportunity for Australians in the market for a more affordable option; particularly when it comes to clothing, shoes and accessories, which are the most common unwanted items. When it comes to second hand shopping habits, the report indicates that Australians prefer to buy second hand books (39%), collectibles and antiques (27%), homewares and furniture (25%) and vehicle accessories (24%).

Kirsty Dunn, Spokesperson for Gumtree said,

“It is clear that many Australians recognise the value of their second hand items. Gumtree has more than 2.5 million live listings across hundreds of categories and on average; almost 30% of these are listed as ‘new’. Interestingly, of those Australians surveyed, only 1% associated the term ‘second hand’ with items that are brand new with tags, so we see great opportunity to change perceptions of what ‘second hand’ is and to reinforce the value sites like Gumtree can bring to a smarter way of living. Over the past year more than one million Australians sold second hand items online for the first time, so it’s no wonder Gumtree attracts more than 7million Australians to the site each month.”

Tips for buying and selling

If you’re planning to buy or sell online, whether on Gumtree, eBay or elsewhere, there are a few tips to keep in mind.

  • Do your research: Whether you’re buying or selling, dedicate time to researching what’s out there and the average price. For buyers, make sure to read reviews of other people’s purchases and their experiences with that particular buyer.
  • If you’re selling, make sure you have a great dexcription of the item for sale, as well as a high quality photo.
  • For buyers, ensure that you ask questions. When first contacting the seller, don’t be afraid to ask lots of questions about the condition of the item and why it’s for sale.
  • Negotiate: don’t be afraid of negotiating a price but make sure your offer is reasonable
  • Common sense: use common sense when it comes to purchasing items – if it looks dodgy, or sounds too good to be true, it probably is!

Budgeting effectively

When you think about the fact that there is essentially money lying around your house without your knowledge, you’d be surprised how easy it is to take control and sell some of your pre-loved items. Keep this in mind next you find the time to do some spring cleaning, that tapping into the second hand economy is a great way to help boost your income, find what you need on a budget, and up your savings, which certainly doesn’t hurt anyone.

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