19 August 2017
The market clearance rate climbed back up on the weekend – to nearly 80% – and, for many buyers, the search continues.
Some market insights for buyers to consider:
- Since changes to the quoting laws, we are seeing more properties selling in and, in some cases, below the quoted range.
- We are still seeing some Statement of Information statements devoid of comparable sales (ie none) or the wrong (lower priced) comparable sales put forward.
- Buyers still are struggling with value on properties.
- Good offerings coming on, with 16 September shaping up as a bigger auction weekend; however, we still think current buyer demand outweighs the supply.
- We are hearing that money is getting harder to obtain from banks, with buyers saying that they are being asked for more financial information for applications.
Offering an architectural advice service as part of our business, we get a lot of enquiries from clients/buyers etc re ‘north v south’ rear orientation. Helping helped people assess / design / renovate homes for around 20 years now, we’ve seen the awareness of this issue change: not many people understood this in the 1990s, but buyers are certainly very aware of it in 2017.
Last week, a buyer called us asking for our insights to improve a home with a south-facing rear that they had recently bought. Have we made a mistake in buying that? they asked.
Well, maybe. A north-facing rear is best if you desire and value access to direct sunlight in your rear open plan living areas, which can be paramount for a long-term family home.
A clever design can sometimes overcome some of these issues of a south-facing rear, but not always.
Characteristics of a north-facing rear:
- Direct access to natural light in the rear informal living areas – warm ‘yellow’ light,
- No, or limited, shadowing to backyard area from the house, which can be very important in winter and, if a second-storey extension is proposed, have less impact on neighbours.
- Renovation and heating/cooling costs are invariably lower, due to the positive benefits of passive solar gain.
- The quality of light into the home is certainly more pleasant and has a positive effect on those living in these homes, and scientific tests have proven this.
- More desirable to buyers for the above reasons, which can positively impact on your future financial outcomes,
Characteristics of a south-facing rear:
- No, or limited, access to natural light in to the rear informal living areas.
- Shadowing to backyard area can be very significant in winter, particularly if the home has a second-storey extension.
- Renovation work can be more expensive, as high-grade glazing/insulation may be needed to combat heat loss in the home to meet mandatory energy rating requirements.
- Less desirable to buyers. Right or wrong, some people just won’t look at south-facing rear properties.
- Rear of property is cooler in summer, due to indirect access to the sun and shadowing.
- Light is more even and consistent, albeit cool or ‘grey’. This is why many art studios like this orientation, but families don’t live in studios.
As a post-script – don’t also trust the floor plan orientations as depicted on advertising – we find this is invariably wrong. As a buyer, you need to do your own research with regard to this (which is not that hard, given most information can be found on Googlemaps).
- 39 Crisp Street Hampton (Jenny Dwyer/William O’Brien, Hocking Stuart) – fairly original ’70s home with five bedrooms, north rear and pool in the growth zone on approx. 627sqm – $2.5m.
- 210 Centre Road Bentleigh (Rob Strickland/Nick Renna, Jellis Craig) – large, renovated family home, well positioned (although busy street) – $1,895,000.
- 34 St Georges Road Elsternwick (Daniel Ashton/Bill Stavrakis, Biggin & Scott) –large family home with well-proportioned front rooms, could be further improved on approx. 578sqm with west rear – $2,405,000.
- 2a Gillies Street Hampton (Robin Parker/Kate Strickland, Marshall White) – approx. 780sqm, west rear, well located to shops, station and beach, sold before auction for an undisclosed amount – early to mid $2millions or close to $3,000sqm.
- 27 Sir Garnet Road Surrey Hills (Tim Heavyside/Harley Toyle, Fletchers) – approx. 602sqm with north rear and timber bungalow ready for improvement (with heritage overlay) – $1,766,000 or $2,933sqm. Given a similar property sold at No.59 with larger land (662sqm) for $1,785,000 around two months ago, this result demonstrates to us that the demand for such land offerings is good and prices are continuing to rise.
- 53 Cecil Street Kew (Maurice di Marzio/Tim Mursell, Hocking Start) 849sqm prime dual occupancy site, sold for $2.536m or nearly $3,000/sqm.
Some of the better properties coming up for auction: an architect’s view
- 139 Cole Street Brighton –Jason Collie/Barb Gregory, Marshall White
- 2 Chaucer Crescent Canterbury – Richard Winneke/Chris Daly, Jellis Craig
- 36 Airlie Avenue Prahran – Andrew James / Lauchlan Waterfield, Hocking Stuart
- 595 Canning Street Carlton North – Tom Roberts/Janine Ballantyne, Nelson Alexander
- Land, Brighton – mid $3millions
- Good land, quiet location, 20-year-old home, Toorak – over $6m
- Large land, family home with pool and garaging, Camberwell – $5m+
- Victorian terrace with 1 OSP, South Yarra – $2.7m
- Good land, home needing work, Malvern East – mid $2millions
- Well located townhouses, Brighton – circa $1m
28 New Street Armadale
Behind the pretty Edwardian façade, this property delivers grand room proportions on a single level with OSP into the rear courtyard. The benefits of its proximity to amenities comes with the danger of significant development over the rear fence along High St. This did not seem to deter potential buyers, with four bidders vying for the keys. Fraser Cahill from Marshall White opened the auction with a vendor bid at $1.36m, which drew out two bidders, who went back and forth strongly before slowing at $1.51m. After a quick consultation with the vendors, the property was announced on the market at this level, bringing in two new bidders. One of the early bidders was not going to give up though and finally outlasted the competition to secure the property for $1.726m. A solid result, which received a round of applause from the 60+ crowd, which included plenty of neighbours.
39 Crisp Street, Hampton
Located in the growth zone, where parts of the street have already seen apartment development, this well located ’70s home on the north side of the street had appeal for both residential home owners and developers.
Auctioneer Stephen Tickell saw a slow start to the bidding, as buyers cautiously started to show their hand, initially needing to place a vendor bid of $2.1m over the first genuine bid of $2m. In the end, the bidding was spread evenly between four bidders who all jumped in and out of the competition at various stages, until at $2,375,000, a large bid increase to $2.5m was made by bidder two (a developer) and announced on ‘the market’ to be sold.
The larger bid was successful, with the property selling at $2.5m, or $3,987sqm.
As more homes are sold around Melbourne to developers, it raises concern for remaining residents about whether to stay or leave the area. For those selling, sometimes the ‘land value’ is at a much higher rate than properties outside the zone, as can be seen with 2a Gillies Street Hampton (which sold before auction, but was scheduled for last Saturday as well). On larger land (approx. 780sqm) around the corner but outside the zone this sold for under $3,000sqm, or around $1,000sqm less than Crisp St.