Archive for March 2016

Highett: Vendor Advocate Andrew Stuart in action – 21 Marshall Ave, Highett (JP Dixon). Sold for $1.455m

Saturday was a record breaking auction day for the month of March in Melbourne with over 1700 auctions called.  On Saturday evening only 1455 of these had been reported to the REIV with a 75% clearance rate, the remainder perhaps hoping to be sold after before reporting in.

The talk at the moment is all about stock – or the lack thereof.  In the key areas we focus in (Stonnington, Bayside, Boroondara and Port Phillip councils), agents are all in agreement that stock for late April/May is likely to be less than the last couple of years.

With very little stock presenting until mid-April, buyers may find opportunities with some of the current ‘passed-in’ properties, however, it is important to keep in mind your property goals and ensure these are met before buying something just because it is available, cheap or convenient.

Whether stock levels will improve as we move into winter (which can sometimes be low anyway) is yet to be determined.  This may result in further pressure for buyers all vying for the same, limited, stock.

We have seen a number of good quality ‘off market’ properties for sale this year for buyers to consider.  Where we bought less than 20% of homes for clients last year ‘off market’, we have purchased close to 40% this year.  There are still some good properties out there, they are just a little harder to find.

Off market properties can often be sold in isolation (i.e. one lone buyer/no social proof), which can sometimes lead to buyers paying well above ‘market’ value for properties.  Great for vendors, however, not so great for buyers if they find their circumstances change unexpectedly and they need to sell.  Having a good understanding of the area, the relevant results and why and the property’s flexibility (different buyer groups the property may appeal to and different uses) can help.

Auction highlights:

Focusing on properties offering specific appeal for ‘downsizers’ – single storey, off street parking, walking distance to shopping precincts/transport, this weekend continued with good results:

Land Sales:

Off-markets:

Auction Spotlight:

Windsor: 39 Duke St (RT Edgar) sold for $4.85m

39 Duke Street, Windsor (Mark Wridgway, RT Edgar), sold $4.85m

A huge crowd gathered outside the historic former “Red Lion Hotel” – converted into an incredible family residence with five bedrooms, three bathrooms and rooftop garden, deck and pool just metres to cosmopolitan Chapel Street. When the last of the crowd wandered out of the home and into the street, Mark Wridgway started proceedings and called for an opening bid. With the rumble of the Formula 1 cars in the background, an offer of $3.6m came from the crowd. Bidder 2 entered the competition and bidding from here on came thick and fast. By the time Mark declared the property on the market at $4.325m, there were four bidders in the mix. At the eleventh hour, Bidder 5 entered the fray and bidding continued steadily until the hammer came down at $4.85m to a round of applause from the appreciative crowd.

Malvern East: 19 Bates St (Jellis Craig) sold after auction in the early $3ms

19 Bates St, Malvern East (John Morrisby, Jellis Craig), sold after auction in the early $3ms

With a striking green canopy enveloping Bates St, auctioneer John Morrisby stepped out before the crowd of around 50 people and delivered a succinct preamble before asking for an opening bid. All was quiet, so John tabled a vendor bid of $2.8m. Bidder 1 jumped in at $2.825m, and then Bidder 2 with another $25k rise. At $3m, John headed inside to refer to his vendor, and with no further bidding on the day, the property was passed in for further negotiations. It sold soon after for an undisclosed amount.

Properties we like, scheduled for auction:

Agent Opinion:“With so many holidays and interruptions in the first quarter, we have seen low stock levels across the board. Do you anticipate there will be an increase in stock levels after the Easter break/school holiday period?”

Bill Stavrakis (Biggin & Scott): “As a result of the low interest rate environment and the liquidity in the local market (Glen Eira, Bayside, Port Phillip, Stonnington and Boroondara) we are seeing many purchasers acquire property and hold their current home and add it to their real estate portfolio’. On the other hand there is also the ‘ passive buyer’. The segment of the market that wants to either upgrade or downgrade and currently owns their own home and will only sell if and when they purchase. Now the problem there is that they can’t find a suitable home to purchase and as a result they are not listing theirs on the market? Far from ideal. Kind of a ‘chicken and egg’ scenario.”

We’d like to take this opportunity to wish everyone a safe and happy Easter. With the market slowing down for the school holidays, we will be back with another edition of Market Pulse in a few weeks.

Sandringham: 11 Cowper Street (Dwyer/Tickell, Hocking Stuart), sold after auction for an undisclosed amount above $2.5m

We saw strong numbers again on the weekend and the formula is a fairly simple one – demand is well in excess of supply, particularly for quality homes close to amenities.

There is some discernment for properties with issues (eg. main roads), particularly if vendors have high expectations.  However, if you are a buyer looking to buy in Melbourne right now, the task is a fairly tough one.

With over a thousand auctions on Saturday (REIV data reported 1041 auctions and 74% clearance), crowds were really strong, particularly for the better properties and our photos really capture that.

New Quoting Laws:

Last week’s media was focused new legislation to crackdown on underquoting.

Whilst this is a win for many buyers, it is also important to remember the quote is only one part of the equation.

Price is ultimately determined by opinions – the vendor and the buyer(s) which can be influenced by a number of factors including:

Often when starting the sell/buy process – the vendor wants ‘as much as they can get’ and the purchaser wants ‘to pay as little as possible’.

A transaction, however, can only take place when the two parties meet.

In real estate, it is an accepted fact that if you want to sell your house well, you engage the services of a selling agent to market the property and provide advice and feedback to help the vendor make an informed decision about the price they ultimately want to sell their home for on auction day.

Agents can provide a lot of information for buyers too, however, the agent is engaged and paid by the vendor to obtain the best price they can for their vendor.

It is important for buyers to undertake their own independent research and maybe engage professional services of their own to be in the best position to buy the property, particularly as the news may impact current processes and strategies, for example will there be more offers before auction now and what constitutes an offer?

Auction Highlights:

Land Sales:

Townhouse Sales

Modern, low maintenance townhouses are in demand, particularly if they have good downstairs bed/bath combinations:

Off-markets:

Auction Spotlight:

Malvern East: 4 Kerferd Street (Abercromby’s) sold for $4.68m

4 Kerferd Street, Malvern East (auctioneer Rob Vickers-Willis, listing agent Emma Pierson, Abercromby’s), sold for $4.68m, 2 bidders

A beautiful, early Autumn Saturday and the auction of 4 Kerferd Street attracted a huge crowd of around 150 people. Rob Vickers-Willis was our master of ceremonies and after calling for an opening bid, was rewarded with a strong offer of $4m. A quick-fire auction, that saw the home on the market at $4.52m, eventually selling for $4.68m. A solid result, continuing a good run for properties in the Gascoigne Estate which in the past two weeks alone has seen $16m sale worth of real estate transactions for quality family homes.

5 Nelson Street, Sandringham (Julian Augustini, Hodges), sold for $2.655m, 5 bidders

Sandringham: 5 Nelson St (Hodges) sold for $2.655m with 5 bidders and huge crowd of over 100 people

Nelson St was overflowing with people and crammed with cars prior to the start of this auction! Well over 100 people had gathered to watch proceedings, with auctioneer Julian Augustini at the helm. After delivering a succinct preamble, Julian called for an opening bid and a strong $2.4m came from the crowd. This did not deter the competition, as another four bidders entered the fray, quickly taking the price to $2.445m with Julian announcing that the property was indeed now selling. A flurry of bids and the hammer finally came down at $2.655m to a thrilled family, with a round of applause from the appreciative crowd.

Hampton: 42 May Street (Marshall White) sold for $1.535m with 4 bidders

42 May Street, Hampton (Robin Parker, Marshall White) sold for $1.535m, 4 bidders

The auction of this home on a high, prominent Hampton corner attracted a crowd of around 75 people, who gathered in the front garden and along the fence to get a glimpse of the action. Robin Parker was our auctioneer and he called for an opening bid. Bidder 1 was quick to reply with an offer of $1.2m before Robin countered with a vendor bid of $1.3m. Bidders 2 and 3 joined the contest and at $1.4m Robin headed inside to refer to his vendor. Back outside and we were advised that the reserve had not quite been met, but we were close. Bidding continued until the sale price of $1.535m was reached.

Properties we like, scheduled for auction on March 19:

Agent Opinion: “Do you think more vendors are  starting to get ahead of the market?”

Daniel Wheeler (Marshall White): “Vendors have been patiently waiting to see how the market would respond after a summer period of no auctions and negative commentary in relation to the economy. What we have seen early in 2016 is the sheer lack of property available for sale resulting in buoyant auctions conditions, which are meeting vendor’s expectations; and in some instances exceeding them.”

Please note that due to the Labour Day weekend, there will be no Market Pulse next week. We will be back with more updates the following weekend, March 19.