Archive for August 2017

46 Karma Ave Malvern East changed hands only for the second time since completion c1924. Four bidders delivered Daniel Wheeler from Marshall White a quick outcome, selling for $2.03m, in front of a large crowd in the winter sunshine.

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.

Architectural advice

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).

Highlights: 

‘Land’ Sales:

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

 ‘Off-market’ Properties:

• 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 

Auction Spotlight:

28 New Street Armadale

Fraser Cahill and the Marshall White team secured a strong result for the vendors of 28 New St Armadale, selling the property more than $200k over reserve.

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

Auctioneer Stephen Tickell oversaw a slow start to this auction, but four bidders joined in to buy this property, which sold for $2.5m.

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.

Campbell Ward (Jellis Craig) directs traffic and bidders at 5 Connell Street Hawthorn. Quick-fire auction – opened $1.7m, on the market at $1.74m and bought for $1.857m.

We are noticing fewer numbers through the open for inspections, although this could be blamed as much on the weather as any market changes. For the better properties though, which are well marketed, numbers are still healthy.

These numbers do, however, coincide with the new quoting rules on advertised prices,  perhaps suggesting that if the expected/desired outcome by the vendor is above the buyer’s preferred buying range, the buyer may choose not to inspect the property at all. This could have a flow-on effect on bidder numbers.

We have noticed less buyer interest from overseas buyers of late and, in particular, from China (which, as foreign buyers, reportedly buy eight out of every 10 Australian homes). With the banks tightening up lending and further restrictions here and abroad from government, this is certainly having an effect. Migration agents are also confirming their frustrations with respect to this.  This could be comforting for local home buyers.

Highlights:

Land Sales:

Auction Spotlight:

34 Kerferd Street Malvern East 

A good crowd gathered to watch this auction but unfortunately for auctioneer James Tomlinson there were no bids and the property passed in on a vendor bid.

On approximately 736sqm, this single-storey home had been thoughtfully renovated and offered great garaging options. Being single storey, the home does cover a fair bit of the land with only a pool and meals area in the courtyard style of garden at the rear making it a low maintenance option.

Unfortunately for auctioneer, James Tomlinson, there were no bidders present and the property was passed in on a vendor bid of $3m.

4 Kendall Street Elwood 

This auction, led by Kaine Lanyon from Marshall White, was entertaining for the large crowd.

This is a pretty brick Victorian family home, more than comfortable to live in as is, but with good scope to extend and improve further. The north-facing rear garden, good width to the block and off street parking are added bonuses for a property in this location.

The home had been available off market before the winter break for offers over $3m.  Following a quick paint and freshen-up, the property has now gone through a full auction campaign with Marshall White. Kaine Lanyon started off proceedings with a vendor bid of $2.5m before two bidders quickly moved things along, slowing only as pricing neared the $3m mark. Just when we thought a result was imminent, a third bidder jumped in and spurred everyone on again. Bidder 1 looked down and out several times, only to dig a little deeper and try another time. Having progressed in $1k, $2.5k and $5k increments from the $2.9millions, it was an entertaining game of cat and mouse that eventually saw bidder 3 come out on top, buying the property for $3.175m. Expected result, we believe.

Some of the better properties coming up for auction: an architect’s view

16 Bailey Avenue Armadale – (Andrew Hayne/Fiona Ansell-Jones, Marshall White)

10 Scott Street Canterbury – James Tostevin/David Smith (Marshall White)

69 Greville Street Prahran – (Tom McCarthy/Michael Tynan, Biggin & Scott)

392 Williamstown Road Port Melbourne – (Arthur Apostoleros/Sophie Dobson, Buxton)

‘Off-market’ Properties:

Notable pass-ins

The auction of this property at 2/9 Kardella St Malvern East showed that the villa is back! It sold more than $200,000 over reserve.

Despite the lack of stock, the clearance rate for auctions was solid this week. Stonnington Council hit the ground running with the three biggest results, after a noticeably quieter weekend last week: 9 Avalon Road Armadale (closer to $6m), 32 Balmerino Avenue Toorak (circa $4.5m) and 2 Netherlee Street Glen Iris (high $3m).

Stock (or lack thereof) is still a major discussion point in the industry, with many agents having few or no listings. More and more buyers are reluctant to sell first before they buy. While we expect to see good property options in the next month or two, it is not likely to be enough to satisfy the buyer depth in the market right now, and this could result in a flurry of activity at the end of the year (post Melbourne Cup).

Anti-development sentiments gaining force in the traditional ‘suburbs’.

The amount of development around Melbourne is hard to ignore right now, and this too is having an impact on buyer decisions. The planning landscape changed drastically last year with significant rezoning changes, and this is starting to have an impact on land sales. While some areas are more protected (ie leafy Boroondara streets), development in other parts is being more actively encouraged (ie fringes of Glenferrie Road/Burke Road, Malvern Road). As always, pro-active due diligence by the buyer (ie independent town planning or architectural advice) is critical.

Highlights:

 ‘Land’ Sales:

Some pass-ins of note:

‘Off Market’ Properties:

Some of the better properties coming up for auction: an architect’s view

27 Sir Garnet Road Surrey Hills – Tim Heavyside / Harley Toyle, Fletchers

39 Crisp Street Hampton – Jenny Dwyer / Will O’Brien, Hocking Stuart

28 New Street Armadale – Fraser Cahill / Dean Gilbert, Marshall White

4 Wright Street Middle Park – Simon Gowling / Warwick Gardiner, Greg Hocking Holdsworth

Auction Spotlights:

9 Avalon Road Armadale

Justin Long from Marshall White faced a large crowd for this prestige location auction.

The auction of this substantial and classically elegant Armadale property drew a crowd of 100-plus to participate and observe proceedings. While the home delivers good family living across its three levels, 9 Avalon Road is all about its prime location within Armadale.

Once the auction got underway, Justin Long from Marshall White immediately started things off with a vendor bid of $4.8m. Two bidders took it in turns trading a range of smaller and sudden larger bids to outmanoeuvre each other. The home was announced on the market at $5.42m, but both potential buyers were keen to pay well above this level to secure the property. The first bidder was eventually the successful purchaser for $5.84m.

2 Netherlee St Glen Iris

The sun shone on Daniel Wheeler from Marshall White as he orchestrated the five bidders vying for this property.

We attended the previous auction of 2 Netherlee St Glen Iris when it was sold for land value in early 2015 for $1.79m, where seven bidders pursued the property because of its location and potential to build well forward on the block.  (Market Pulse – Feb 2015)

The new owners have since built a striking family home offering five bedrooms, including an impressive master suite, 3.5 bathrooms and multiple living zones. Even with its south-facing rear, the property delivers good inside out living and has positioned the outdoor entertainment area and pool to capture maximum afternoon sunlight.

Daniel Wheeler and the Marshall White team were back from two years ago to market the new home. They first worked to sell the property off market during the quieter winter months but that did not bring out buyers willing to make an offer at the required level.  Taking the property through an auction campaign found successful bidders who were comfortable to pay $3.825m. There were four other interested parties competing, which took the price past the reserve around $3.7m.