8 September 2018
As we head into Spring, we expect to see the better (or conveniently located) homes well contested. With the warmer weather, we saw increased numbers attending auctions and some very well attended inspections. If you don’t have an ‘A’ grader, these numbers should provide confidence that buyers are around if the property is priced correctly.
The biggest change we have seen this year is the faltering of the auction process, partially brought about by external influences (royal commission, reduced access to money etc) but also by overly optimistic vendors who started to believe their properties should always see higher results than the previous sales.
We believe in five-year flexibility. For most homes bought five years ago (As, Bs and even some C graders), there has been good growth. Maybe if you had sold 12 months ago, it would have been slightly higher, but, in general, the majority of homes (perhaps excluding new apartments) are worth more than they were five years ago.
As a seller auctioning your home, if you’re willing to meet the market, you should take comfort that the auction process still provides a clear process, set timeframe and transparency for buyers. However, the changing market has brought about an increase in private sales, expressions of interest and stale properties.
As a buyer, this can also be a good way to buy, particularly if you have a thorough understanding of what you need and the market you’re buying in. However, it also results in reduced transparency as each agent will have their own way of managing things (ie their own set of rules depending on the property, other buyers, similar products and vendor expectations).
You can also waste a lot of time trying to buy a home that may not really be for sale and miss other genuine opportunities.
Here’s how you can improve your chances of buying one of these homes:
- Have a good relationship with the agent (although maybe not too good; you might wind up paying $100,000 more than you have to – the agents are getting paid by the vendors no matter how friendly they are).
- Get a clear understanding of the process before you start talking dollars.
- Ensure the property is really for sale.
- Engage the services of an experienced buyer advocate.
For sellers who bought a ‘B or C’ grader more recently and need to sell now, the opportunity to make some money and/or recoup costs may not be there. As an example, 392 St Kilda St Brighton sold privately last week after passing in on 1 September. It was last sold in February (only seven months ago) for $3.09m and just sold again for $2.95m.
- 37 Hampden Road Armadale (Warwick Anderson/Holly Gillham, RT Edgar) – approx. 1400sqm, single storey, renovated period home selling for an undisclosed amount before auction – circa $8m
- 10 Queens Square Sandringham (Robin Parker/Kate Fowler, Marshall White) – approx. 650sqm well located property with pretty period façade, although ready for the next renovation to bring it back to life – 4 bidders and $2,152,000
- 7 Devorgilla Avenue Toorak (Michael Gibson/Robert Fletcher, Kay & Burton) – approx. 457sqm, with low maintenance modern home over three levels – sold after auction for an undisclosed amount over $4.5m
- 4 Wallis Avenue Glen Iris (James Tostevin/Daniel Wheeler, Marshall White) – large townhouse with basement parking, preferred northern light access and park frontage – sold at auction for an undisclosed amount in the early-to-mid 3m range
Some of the better properties scheduled for Auction on 22 September; an architect’s view
4 Gwenda Avenue Canterbury – Sally Morrison/Judy Balloch, Kay & Burton
56 Leura Gr Hawthorn East – Monica Rezk/Davide Lettieri, Marshall White
23 Fawkner Street South Yarra – Mark McKenzie/Gerald Delany, Kay & Burton
11 Newbay Crescent Brighton – Mark Staples/Gerry Gordon, Jellis Craig
- Renovated Edwardian with North rear, Malvern – circa $5m
- Development site, NRZ3, 1,370sqm, Hampton – circa $4.4m
- Period front w modern reno/extension family home, Hawthorn East – circa $3.75m
- Family home on large land, park to Yarra behind, Ivanhoe East – early $3m
- New large family home with pool, Highett – circa $2.1m
- Renovated brick 2 bed 1 bath, Hawthorn – circa $1.6m
- 1930s home to renovate or new home site, 713sqm, Hawthorn – circa $4.2m
- Renovated 3 bed weatherboard, Northcote – circa mid $1m
- Grand 1881 Terrace home w OSP, Fitzroy – circa high $2m
- Art deco looking for full renovation, 713sqm, Caulfield South – circa mid $1m
7 Devorgilla Avenue Toorak
This well positioned home offeres good spaces within a functional floorplan, with a sunny north rear aspect. Good basement garaging was another plus, although the lack of lift may have deterred parts of the market.
Around 50 people attended the auction, led by Gerald Delany from Kay & Burton. Following the standard auction rules and complimentary overview of the property, Gerald was met with a quiet audience. A vendor bid of $4.7m was placed to get proceedings started. Try as he might by pushing the value of being the highest bidder to have exclusive negotiation rights, as well as going inside to give everyone some extra thinking time, nobody was forthcoming with an offer. The property was passed in on the street, but it did not take long for an interested party to come forward and the home was sold shortly after for an undisclosed amount slightly over $4.7m.
64 Beaver St Malvern East
An auction on Beaver Street Malvern East always draws a good crowd and the auction at number 64 was no exception. More than 100 people stood along both sides of the street to watch the action for the sale of this pretty and well renovated Edwardian. The home offers spacious family living within the Gascoigne Estate, with both west and north facing outdoor options even on a south rear block.
The home last sold 10 years ago for $3.325m and has since undergone a full cosmetic update, as well as the addition of the pool.
Justin Long and Rae Tomlinson ran the campaign, with Justin leading the auction on Saturday. As he customarily does, Justin opened with an instant $5.4m vendor bid to get the action started. Although there were so many in attendance, no one was prepared to actively participate in the auction, even after a half-time break. The property was eventually passed in and remains on the market at time of writing, with an asking price of $5.88m.