27 July 2019
With mid-year school holidays over and Spring on the horizon, the Melbourne property market becomes all the more topical. The ‘Confidence Swing’ after the election appears to have been very positive, with buyers far more confident to transact now.
Inspection numbers have increased, while stock levels have remained low. This has ultimately led to stronger auction clearance rates (over 70%) than we have seen for most of 2019. At this stage it appears unlikely, but, if stock were to increase, it will be interesting to see whether clearance levels will be able to remain at these levels.
24 Raleigh Street Thornbury was a good example of a recent hot auction. Listed and sold by Robert Enes from Nelson Alexander, this was a neat single-level home with a functional plan and good car parking. The position and price point were key factors here and the property sold very strongly for $1.46m (after being declared on the market at $1.2m).
- Many transactions are happening off-market or as private sales enabling offers to be made subject to conditions such as finance. We note a number of these contracts are also falling over if conditions are not met.
- Finance is still a problem for many buyers, particularly for those wanting extra-long settlements.
- Loans for renovation work are also becoming harder to obtain.
- Lack of stock is still driving prices for the better properties up or well above quoted ranges.
- Investor vendors are starting to sell as land tax bills (particularly for those owning multiple properties) grow as a result of updated property valuations.
- Independent due diligence (more than ever) is important – please note this is not the agent’s job. We have noticed recently that many ‘new’ renovations are being done without the required warranty insurance which could pose a big risk to the future buyer. Understanding zoning is also important as development continues to play a big part in our neighbourhoods.
We usually expect to see high-volume auction weekends the third and fourth weekend post-school holidays; however, that is not looking likely in the near future and it leads to the question ‘will we see any more of the 1,000+ property auction weekends for the remainder of 2019?’ At this stage, it is not looking likely.
For buyers, this could mean longer waits for the ‘right’ property and, for those selling the ‘right’ property, potentially inflated prices as they sell with less competition than usually expected.
“Off Market” Properties
- Large Victorian home on land over 1,100sqm, north rear, Hawthorn – circa $6.5m
- ’90s town residence, 3 bed, 2 bath, 1 garage, 1 OSP, Hawthorn East – circa high $1m
- High-end architectural TH, 2 bed, 2 bath, 2 car stacker garage, Prahran – high $2m
- Timber home, approx. 234sqm, 9m frontage, likely new home site, South Yarra – circa $1.8m
- Double-fronted brick Victorian with dated extension, approx. 460sqm, South Yarra – circa high $2m
- Modern TH, 4 bed, 3 bath, DLUG, Malvern – early $2m
- Double-fronted Edwardian on 510sqm, renovated, Caulfield North – circa $2.5m
- Single-level period style home, Black Rock – circa $1.7m
- Victorian Terrace over 3.5 levels with views, East Melbourne – circa high $5m
One of the better properties coming up for Auction: an architect’s view
48 Asling Street Brighton – Nick Johnstone/Russ Enticott, Nick Johnstone RE
The home at 2 Scott St Caulfield South offers a pretty package for young families. Renovated and extended some time ago, the main house delivers three bedrooms and a study, as well as two living zones. The studio in the rear with bathroom and kitchenette is a definite bonus. Proximity to Ormond Station and the North Rd shopping precinct are further pluses, which attracted the large crowd of over 70 people at the auction on Saturday. With a price guide of $1.35-1.45m, an opening bid of $1.45m was immediately made by a young couple. Another couple joined in and swift $25k bids saw the home brought onto the market at $1.6m. Slowing things down to $5 and $10k bids, first bidder 1, then bidder 2 stepped out as a third and fourth entered the competition. These bidders very clearly wanted the property and were unwilling to give up the chance for the keys. Trading bids tirelessly with a mix of larger and increasingly smaller increments, bidder three eventually outlasted all, securing the home for $1.79m. Surely a result the vendors will be celebrating.