She is one of the more than one in two Australians who regularly sell secondhand items, with a new report estimating 84 million used goods changed hands in the past year.

"It sickens me seeing things go to landfill," said Hannah, 43. "I'm not perfect by any means but if I can pass on things that are good quality to family and friends, I feel I'm extending the life of the product and not contributing to a disposable society."

The annual Second Hand Economy Report, commissioned by online classifieds site Gumtree, found the secondhand economy could be worth as much as $40 billion if you add up the value of unwanted items in Australian households. That was a $10 billion rise since last year.

The report included a Galaxy Research survey of more than 1000 people, which found nine out of 10 Australians have unwanted items in the household.

The average number of unwanted items is 25, worth an estimated $5203 per household in total.

More than one in two Australians reported selling secondhand items in the past year, with an average total of $3246. The most commonly sold items were homewares and furniture; clothing, shoes and accessories; electronic goods; and games and toys.

Members of Generation Y earned an average of $6087 from the sale of their items, more than Baby Boomers ($1750) or Generation X ($1079).

Hannah, who lives in Leichhardt in Sydney's Inner West, said she has trained her sons, aged 7 and 5. The family is about to sell kids' toys before the influx of Christmas gifts and will put the proceeds towards some much-wanted Lego sets.

She also buys many items secondhand, including household furniture. She uses Gumtree, Facebook groups such as Inner West Mums, charity shops such as Vinnies, visits garage sales and scours the footpath on council clean-up days.

Hannah said selling items secondhand contributes to the household budget, but she doesn't drive a hard bargain and also donates to friends and family and the local community.

"I definitely could make more money than I do but it's not about the money, it's more about finding the right home for the goods," she said.

Dr Rebecca Valenzuela, from the Department of Economics at Monash University in Melbourne, said the findings were credible and linked to the trend for households to exchange goods online and the so-called sharing economy, which includes sites such as Airbnb.

The other reason was that households were feeling greater cost-of-living pressures. Dr Valenzuela said Australians were facing job insecurity, with less and less certainty of having a job in the next five years.

"Incomes are under pressure but our needs as households and families are pretty much predictable with a lot of fixed costs," she said. "Couples and families need to make choices about where to put resources."

Dr Valenzuela said middle-class incomes had not kept pace with the growth of the economy since the turn of the century.

Caitlin Fitzsimmons is the editor of Money. You can find her on Facebook and Twitter.