Posts by Alexandra Ruffell

Completed homes in good suburbs continue to sell well, as this auction in Vickery Street Malvern East demonstrated. Seven bidders fought it out for this home, which sold under the hammer for $3.6m. (James Tomlinson and Rae Tomlinson, Marshall White).

Mid-year is a good chance to pause and take stock of the Melbourne property market’s performance so far. There is no doubt the market has performed strongly this year, particularly for good properties, ie well-renovated period homes, striking modern homes or premium land parcels.

For less than perfect offerings or those with issues, the gap between buyers and sellers has been widening recently, with a lot more properties left on the market for private sale after a failed auction than has been the case in previous months.

Winter is not traditionally a strong selling season in Melbourne, as colder weather and darker days means properties do not present in their best light. Many eyes are now on August and September auction selling campaigns.

While traditional residential suburbs (eg Camberwell, Brighton) had limited offerings, the inner-city suburbs like Carlton / Fitzroy recorded some good results, as you will see below.

Some sales of note:

‘Land’ Sales:

Off-markets

New quoting law analysis

Almost two months after the introduction of the new Victorian quoting laws, what sort of impact are we seeing?  At WoledgeHatt, we physically inspected dozens of properties in our area of specialisation ­­– $1.5m-plus in Boroondara, Bayside and Stonnington councils – taking note of the Statement of Information (SOI) quotes and comparables, as well as the eventual selling price of the properties. As a result, we have seen a reasonable shift in numbers (taking out outlier results for properties that sold vastly above reserve).

For May sales, where properties were still signed up under the ‘old system’, we saw sale prices on average 4.8% over the top of the quote range. Nearly two-thirds of properties were quoted below the eventual sales price.

For June sales, where the market has started to settle into the new laws, we have seen a lessening in this number, with properties selling on average 2.3% over the top of the quote price. Nearly half of all properties are now selling within the quote range.

While it will take a few more months for the backlog of properties signed up before the new quotation laws came into effect to clear through the system, if this trend continues, it looks as though quotations are coming more into line with buyers’ willingness to pay.

From general discussions with agents throughout this time, there are probably a few teething issues to continue to work through in regards to the selection of comparable properties. Depending on the property and the area, can the 2km and six-month limit at times be too restrictive and eliminate better-suited comparables, or is it too liberal and permits the inclusion of properties that are realistically not a comparison?

As a buyer, has this made things better or easier? Perhaps. Yet understanding the true value of an individual property, given its scarcity or place in the market, is still key to paying the right price for a property. More importantly, what the buyer wants to get out of the property should influence what they are prepared to pay for it, more so than the range that it is being quoted at.

Renovating – as a buyer/owner are you under-developing?

In recent years, as you may have noticed, there has been a huge amount of development going on around Melbourne and, in certain areas, councils are really encouraging this development. If you are considering renovating, it pays to keep this in mind when planning. Some call it ‘over-capitalising’, some call it ‘under-developing’, but the result is the same: the real value of your property could be in the dirt bounded by the fences, not the house itself.

Having architectural experience, we are often asked how to renovate homes and we welcome these conversations. A common theme lately has been with people wanting to undertake extensions to their existing homes, or build new on their land. Here are a couple of issues that have come to light:

• While the home may have intrinsic period quality, it may not be protected by a heritage overlay, or it could be subject to new zoning overlays that mean higher height levels are permitted. This of course encourages development. If you are able to build up to 11m metres (say) and don’t choose to (which is fair enough), your neighbours may do so and this could adversely affect your amenity and capital growth (ie your renovation costs mean nought in the end, as the true value of the property is in the land).
• Alternatively, the home may be in a Heritage Overlay area, or in a more restrictive Neighbourhood Residential Zone. Getting the right balance of old and new is critical, and you need to be very careful when planning.

These two issues can have a big impact on the re-sale or property in Melbourne. You may love your house and area and see yourself there for the next 20 years, in which case whatever money you sink into your renovation will be worth the cost. But if you are thinking of selling your house within 5-10 years, don’t expect to get the money back.

You should also plan a sympathetic renovation that is in line with the overwhelming wants and needs of buyers in that area. Spending $1 million on a renovation in Malvern where there is a lot of development and many newer properties are being built could be a waste of money. You may be better to sell and move to the Gascoigne Estate where you will be protected by heritage overlays. Similarly, building a modest cottage that’s more suited to the inner north in a leafy eastern suburb where dual occupancies or larger family homes are more in demand is also not a worthwhile investment.

More than ever, it pays to get the advice of a good architect, town planner and experienced selling agent before making any of these key decisions.

Auction Spotlight:

9 Alleyne Avenue Armadale

Andrew Hayne conducts an entertaining auction in front of around 200 people in Alleyne Avenue, Armadale.

This was a landmark 2017 auction, and a very good crowd attended. Why was it landmark? Well, the home was a beauty – cleverly designed, well renovated, enjoying an ideal north-facing rear aspect, and very conveniently located to most things great in Armadale.  The property was also very well marketed and presented. There was not a stone left unturned here by the vendor. While there was were clearly a lot of interested parties within the quoted price range, a vendor bid was still needed to get this auction kicked off and Andrew Hayne did that at $4.4m. Not long after, the first bidder entered the fray at $5m, which clearly made a strong statement. A fight was on not long after between the original bidder and one other, and the property sold under the hammer for $5.925m, almost $1m over the announced reserve. A lot of people will be surprised by this result but it just shows that buyers in this market will pay a premium for quality offerings, especially those they can move straight into. Expect to see plenty of renovation projects in this area in the coming months … the formula and process isn’t that easy though.

44 McKinley Ave Malvern

Andrew McCann and the Jellis Craig team had the sun shining down on them at the auction of this property in Malvern.

This home is an example of an unrenovated version of double-fronted period properties in the area that have recently sold for between $5-6m. Well positioned to amenities and transport, the property currently offers off-street parking, but may not allow for future garaging.

With most of the crowd spread along the opposite side of the street, as well as some key bidders on the property side, Andrew McCann from Jellis Craig needed to make his voice carry far and wide. A swift opening bid of $2.75m started proceedings and bidding from a number of parties easily brought the property onto the market at $3.01m. By the time the property was knocked down for $3.19m, five bidders had put their hand up for the property and the chance to transform this home into the period beauty it could be.

2C Kerferd Street, Hampton

Two bidders bid strongly for this property, which showed the demand for ‘position’ first. (Kate Strickland/Robin Parker, Marshall White).

‘Hampton’s style’ in Hampton.  This new home was very well located to the Hampton shops, station and beach, offering four good bedrooms (the main downstairs) and multiple living options, including a separate room off the back of the garage. On a ‘battleaxe’ block, the home had no street frontage and was accessed via a stony laneway shared with the dwelling in front.

Two bidders bid strongly in $50,000 rises from the initial vendor bid from auctioneer Robin Parker of $2.8m. With little time to pause, Kate Strickland ran inside to consult with the vendors before returning to confirm the property ‘on the market’, with the eventual sale price settling at $3.15m.

This sale supports the increasing demand for ‘position’ first.  With limited choices available for buyers wanting family homes, the position encouraged buyers to overlook any potential or future negativity brought about by the lack of street frontage, lower ceilings and limited windows in the family room.

Tennis courts always make fantastic settings for auctions. 49 Lisson Grove Hawthorn sold strongly under the hammer for $7.65m, almost $1m over reserve. Listing agent Jock Langley and auctioneer Tim Derham, Abercromby’s.

For the first time in quite a while, the clearance rate dropped to the lower 70% range, with the REIV reporting a clearance of 74%, at 6pm Saturday.

Do we think that means the market is turning? We don’t think so, but we do think that some buyers are confused by the mixed methods of quoting (some are still being quoted using the old system, while those listed post-1 May use the new ‘more accurate’ system).  We also saw some good properties pass in (eg 29 Bridge Street Hampton – see auction spotlight below) at what we believed were strong levels and some sold for even more afterwards.

Next weekend is now the last ‘big’ weekend before the market goes into hibernation before resuming with some numbers again in August.  This may result in some increased sales of homes sold privately, or, as many like to now call it, ‘off market’, particularly for vendors who have recently bought and want to minimise their exposure to any potential changes in the market place.

With reports this morning that the Melbourne population, currently sitting a little over 4.5 million, is likely to grow to nearly 8 million in the next 30 years, it is hard to imagine demand changing for the well-located, good-quality family and downsizer homes.

Highlights: 

‘Land’ Sales:

‘Off Market’ Properties:

Properties we like, scheduled for auction 1 July 2017:

63 Liddiard Street Hawthorn – Alastair Craig /  Veronica Khoo (Jellis Craig)

20 Byron Street Brighton – Ross Walker / Greg Costello (RT Edgar)

65 Karma Avenue Malvern East – Daniel Wheeler / Justin Krongold (Marshall White)

26 Salisbury Grove Northcote – Sam Rigopoulos / Eric Brown (Jellis Craig)

Auction Spotlight:

29 Bridge St Hampton

Stephen Wigley from Hodges Sandringham faced a large crowd with four bidders at the auction of 29 Bridge St Hampton.

This auction provided prospective buyers with another opportunity to purchase a well-positioned, north rear development, similar to recent good sales in Willis and Littlewood Streets in Hampton. With approximately 716sqm of land in close proximity to the beach, shops and train stations, the property included approved plans for a dual occupancy development, if potential buyers didn’t want to retain the site for a single home.  A good crowd of more than 70 people sought out the winter sunshine to watch Stephen Wigley and Paul Bond from Hodges run proceedings. Opening with a vendor bid of $2.0m the auction began slowly before picking up pace after a quick break. Four bidders brought the price up to $2.25m, where Stephen again conferred with the vendors. No further bids could be drawn from the crowd and the property was passed in at this level. The property sold afterwards for an undisclosed amount around $100,000 more.

Going to an auction as a buyer, it is important to be prepared for multiple strategies, including post-auction negotiations, as vendor expectations may be above market levels.

3 Johnson Street Hawthorn

A chilly, still winter Melbourne morning, but the bidding was hot at this auction – four bidders.

Premium north-facing land only a stone’s throw away from Glenferrie Road, this single-fronted Victorian, which clearly had seen better times, was up for auction less than two years after it last sold for around the $1.35m mark. Auctioneer Tim Derham looked for an opening bid and had to wait a while, so a vendor bid was placed at $1.8m. This started the auction and measured bidding between four bidders saw this property announced on the market at $1.975m and eventually sell under the hammer for $2.053m. What does this tell us? Good land (with above average width for the area) is still in good demand and the auction system is alive and well, as apparently this buyer (a younger Chinese couple) had only seen the property a few days ago. 

Agent Opinion: How do you see the market heading into the winter hibernation period?

Anthony Grimwade, Director, RT Edgar: As winter begins to set in and with the June / July school holidays looming, housing stock is starting to tighten. Competition for well located period and contemporary homes continues unabated and this was witnessed with last week’s RT Edgar sale of 49 Murray Street, Prahran. An original two-bedroom double-fronted brick Victorian directly opposite Victoria Gardens and in the Hawksburn Village precinct, it was hotly contested between two buyers and sold for $3,110,000, $210,000 above the reserve.

Another key RT Edgar sale at the other end of the spectrum was 8 Chesterfield Avenue, Malvern, an unrenovated 1930s two-storey home on about 1,400m² of land that sold one week into the marketing campaign (price undisclosed) but believed to be in the vicinity of $7 million.

This Elwood auction opened and was on the market for $2.95m, and sold for $3.21m. Inan/Manning, Hocking Stuart

With just under a month before the winter school holidays begin, the Melbourne property market is chugging along steadily.  The REIV reported a clearance rate of 78% and, while we attended quite a few auctions that passed in, most were sold shortly afterwards.

We have noticed numbers are down at some open for inspections. Some buyers are choosing not to inspect homes if the quote is above their preferred buy price.  Before the recent changes to quoting laws, they may have been attracted by the quote, fallen in love with the home during the inspection and then made the decision to increase their limit to try and buy it.  Now, some aren’t making it to the property for the rest of this scenario to occur.

Although the new quoting rules have been implemented, there are a number of the homes listed (the day the vendor signed the authority to sell) prior to the 1^st May being quoted the ‘old’ way.

There are also the properties quoted using the new system drawing on ‘comparables’ that aren’t really comparable.  For homes being sold in larger suburbs (such as Camberwell, Brighton, Hampton, Malvern East etc), it is important for buyers to understand the nuances of the difference precincts: their past history, current desire and potential future changes, to determine whether the example is a suitable comparable or not.

For buyers finding pricing confusing, it is even more so at the moment.

That being said, if the home is a good one, the buyers will come. We attended the official first open at 9 Alleyne Avenue Armadale on Saturday and it felt more like a party than an inspection.

Highlights:

‘Land’ Sales:

 Properties we like, scheduled for auction 24 June 2017:

9 Alleyne Avenue Armadale – Madeline Kennedy/Andrew Hayne (Marshall White)

8 Leslie Street Hawthorn – Campbell Ward/Richard Winneke (Jellis Craig)

29 Hambleton Street Albert Park – Kaine Lanyon/Justin Holod (Marshall White)

3 Champion Street Brighton – Campbell Cooney/Alana McGuinness (Hodges)

Auction Spotlight:

78 Hope St South Yarra

There was a strong crowd and spirited bidding from five parties during this auction.

This home is an unpolished gem in a prime location. Interested parties could envisage what a thorough renovation of this north side of a pair home could deliver and the value of the proximity to parks, public transport, restaurants and the city. Opening with a vendor bid of $1.85m, Tim Brown from Castran Gilbert received numerous offers that quickly placed the property on the market at $1.95m. With one party trying to slow momentum with smaller and smaller bids, another bidder tried to intimidate the opposition with large offers. With five parties vying for ownership, the first momentum-slowing-bidder was eventually successful in buying the property for a solid $2.21m.

3 Vaucluse St Brighton

Julian Augustini from Hodges Bayside was made to work hard to entice a bid from the audience at this auction.

This spacious family home with a north rear is well positioned to the Bay Street shopping precinct, a range of schools and the beach. While its proximity to the development growth zone and Hampton Street traffic noise may have held bidders at bay, the property offered a good step into the Brighton market. Seeking opening bids of $2.2m, Julian Augustini from Hodges placed a vendor bid at this level to open proceedings. As we are seeing more frequently recently for properties without a strong wow factor, there was only one bidder present, placing a bid of $2.22m, which the property eventually passed in at. Post-auction negotiations secured the sale for $2.25m. 

Agent Opinion: As one of the newer agencies in Bayside achieving strong results, including your sale at 31 Third Street, Black Rock on the weekend (over 900sqm with large, but dated, family home) selling for $2.52m, where are you seeing the strength in the market?

Kylie Charlton, Director, Charlton King (Sandringham): We are seeing two separate markets at the moment – the downsizers and the younger families.

Speaking specifically for south Bayside, the downsizers can be broken into two groups – those under 65 who are still prepared to do some renovations, and those over 65 who want to move in to a home that is all done with no extra work.

Most downsizers are wanting to stay within 2 kilometres of their family homes and are not prepared to sell until they have bought.

This is having a flow-on effect on stock levels for families trying to buy into the area, many of whom have been renting in the area and are now ready to buy, or want to upscale.

AREC 2017

Consistency in the inner Melbourne property market is continuing with the REIV reporting a clearance rate of 77% at 6pm on Saturday evening. This is slightly down on last week’s clearance rate.

On the weekend, we noticed the continuing trend in successful post-auction negotiations after the property has passed in on the street, perhaps signifying a mismatch between vendor and buyer price expectations. Our conversations with some key agents have confirmed that, for the first time in a long time, their company clearance rates have dropped below 80%.

Many working in the real estate industry are in Queensland early this week for the annual real estate conference (AREC). Perhaps still heavily tailored to achieving outcomes for vendors, we find the conference is a good opportunity to stay up to date with the most current trends, ensuring we can continue to put our clients in the best positions to secure their new homes.

Auction Highlights:

Land Sales:

Off Market Properties:

Auction Spotlight:

39 Mason Street Hawthorn

Scott Patterson from Kay & Burton worked the crowd hard at Mason Street, Hawthorn but was unable to get an outcome for his vendor until after the auction.

More than 100 people came to witness the auction at this beautifully renovated, single-level Victorian. Scott Patterson from Kay & Burton opened the auction with a vendor bid of $4.0m, calling for $50k rises. One bidder took up the offer, while the rest of the crowd remained silent. Following a brief half-time break, no further bids could be drawn out, so the property was passed in for $4.05m. The bidding party went inside for further negotiations and the property sold shortly after in the early $4m range.

76 Manning Rd Malvern East

Daniel Wheeler and the Marshall White team working the crowd at 76 Manning Road Malvern East

Lovely morning sunshine shone on the crowd spread along Manning Road for the auction of this fully renovated family home. Daniel Wheeler from Marshall White faced a good crowd on both sides of the street. Opening with a $2.0m vendor bid, four bidders kept proceedings going up to $2.33m where it passed in, not quite meeting the vendor’s expectations.  The property sold shortly after for $2.4m.

Agent Opinion – Bob Wolff, Harcourts (USA) – the key to success in real estate

Bob spoke at the first AREC conference in 1997 and returned to AREC this week, where he spoke about his eight key strategies to achieve success for his clients. His strategies have been honed during his 44 years’ experience in real estate. While aimed more at selling agents, we found plenty of useful insight to share with our clients.

Jack Bongiorno (Marshall White) at 5 Central Park Rd, Malvern East. It was a big crowd but he couldn’t find any bidders during the auction (not even junior ones!) The property passed in on a $4m vendor bid and sold after for an undisclosed price.

The market continues to be solid, with the REIV reporting an 80% clearance rate at 6pm on Saturday. Numbers were busy at opens and auctions but there doesn’t seem to be panic on the streets, with most people prepared to wait for the right property. We still saw pass-ins on the weekend (many with multiple bidders), but private negotiations afterwards resulted, for the most part, in successful outcomes for both buyers and sellers.

The hottest market at the moment is for unrenovated homes, and we’re seeing premiums paid for these offerings and also good downsizer homes (see below).  Unrenovated homes can be a great opportunity for you to buy into your preferred area but there are many aspects to consider beyond location, such as building costs, planning constraints and what are the right decisions to make without over-capitalising. With a registered and practising architect as part of our business, our clients are able to pursue these properties fully cognisant of all the issues involved.

Auction Highlights:

Land Sales:

Off Market Properties:

Auction Spotlight:

28 Kintore Street, Camberwell

Al Craig and Richard Jellis were both present at this auction, with Al conducting proceedings for one of the two big results they had on the day.

Standing among a blanket of golden Plane Tree leaves, some as big as dinner plates, I, along with about 80 others, waited in anticipation for this auction. This property is a lovely family home located within one of Camberwell’s prettiest streets, especially at this time of the year. Jellis Craig company founders Richard (Jellis) and Alastair (Craig) were present to achieve a good result for their vendor. Alastair conducted the auction, and looked for an opening bid. Not too uncommonly for a property such as this, a vendor bid was placed and then another in the mid-$4m range. Two bidders opted shortly after and the auction climbed along in measured bids. At $5m, the property was on the market and then sold under the hammer for $5.020,000. With an unrenovated version of this selling not far away in Victoria Rd in March for around the $4.7m mark, this result tells us that perhaps there is more demand currently for unrenovated homes OR the market could be tempering.

125 Linacre Road, Hampton

James Paynter from RT Edgar worked the crowd with Rosslyn Mastrangelo at 125 Linacre Rd Hampton to entice a bid from the crowd for this family-focused home.

The sun shone through the trees surrounding 125 Linacre Road Hampton and the reasonable crowd gathered on both sides of the street for this RT Edgar auction run by James Paynter.  This Inform property was built about 9 years ago with a functional family floor plan. A north rear, as well as a west deck and paved area delivers good entertaining space.  The home is getting slightly further away from the Hampton St shops and train station.  Perhaps this contributed to buyer expectations not exceeding the opening vendor bid of $2.5m. The property passed in at this level and remains on the market for an undisclosed amount.

Agent Opinion: As an experienced agent in the Glen Iris area, how have you found stock levels recently and does there seem to be a greater demand for ‘land’ properties?

Zali Reynolds, Partner, Marshall White: Supply has definitely been low throughout 2017, particularly for quality family homes in the $2m+ range. This has seen good competition for the few available properties that have gone to auction.

This has obviously spilled over into ‘land’ value properties or homes as buyers look at other opportunities to create their ultimate family home.

Buyers need to consider all opportunities. If the location is good, consider the possibility of a renovation or rebuild.

Hot Mother’s Day auction: opening at $1.25m and selling more than $200,000 above the reserve price of $1.4m. Auctioneer Phillip Kingston (Gary Peer Real Estate) conducted proceedings at 42a Carrington Grove, St Kilda East.

While the reported auction clearance rate is still robust – the REIV reported a 78% clearance rate for this weekend – more properties seem to be passing in. We are starting to see some discrepancies between sellers’ and buyers’ expectations of price. Some vendors may have their price expectations a little higher than where market sentiment is for the property.

A standout for us attending auctions this weekend was the number of pass-ins. As a buyer, it’s important to know what’s happening on the street rather than read about clearance rates in the media, as raw numbers and bidder stats don’t always tell the full picture.

As an example, here is a list of properties that were all passed in at auction. Some sold afterwards and will therefore be reported as an auction sale but were they actually sold under the hammer (which many would say, is the conventional definition)?

• 51 Ranfurlie Crescent, Glen Iris*
• 49 Bellett Street, Camberwell*
• 50 Nicholson Street, South Yarra
• 10 Stodart Street, Camberwell
• 66 Claremont Avenue, Malvern*
• 20 Rose Street, Armadale*
• 103 Longview Road, Balwyn North
• 164 Tramway Parade, Beaumaris
• 3/1 Thomson Street, Brighton
• 6 Mytton Grove, Brighton
• 2 Milliara Grove, Brighton East
• 2 Quinton Road, Camberwell
• 49 Mangarra Road, Canterbury
• 36 The Ridge, Canterbury
• 4 Rowen Street, Glen Iris

* identifies those sold afterwards

The pass-in trend may increase, so it is vital that buyers have a good understanding of values and prepared negotiation strategies in place. Buyers also need to understand what is a good property in the context of the market: how much is too much?

Another trend we’re seeing is the increase of off-market properties. This may be for several reasons, including that properties don’t present in their best light at this time of year; advertising is not cheap; and off-market sales are not subject to the new quoting laws. We’re finding one-third of the properties we’re buying are off-market. Off-markets can be harder for buyers to find because you need to have a relationship with the key agent and ongoing relationships are very important. Negotiation strategies when you are emotionally involved can also be difficult.

Auction Highlights:

‘Land’ Sales:

Off-Market Properties:

With the colder weather upon us (properties right now are not presenting as well as they do in warmer months), there has been a considerable spike in the amount of off-market properties up for sale and /or selling. Those buyers gauging property numbers purely on those advertised online and/or featuring in print media may not be getting a feel of the ‘full market’.

Here is a sample of what we have been privy to this week: 

• double-fronted brick home – Hawthorn – $4m
• land – Armadale – early to mid $2ms
• large family home – Caulfield South – $3.5-3.8m
• land – Stonnington Glen Iris – $1.8-2m
• large period home on big land – Brighton – above $6m
• residential land – Brighton $3.5-4m
• large new family home Glen Iris – $3.5-3.7m

Auction Spotlights:

93 Stanhope St Malvern

John Bongiorno (Marshall White) working the crowd at 93 Stanhope St Malvern to entice a bid for this well-positioned townhouse.

This low-maintenance townhouse was aimed at the downsizer market. Well presented and with spacious living zones, perhaps the lack of a downstairs bedroom held potential buyers at bay. The home was first listed for private sale in mid-April for $2.5m. Marshall White then took the property through an auction campaign, culminating in this auction, conducted by Jack Bongiorno. Calling for bids and opening proceedings with a $2.2m vendor bid, the crowd spread along both sides of the street remained silent. The silence continued and the property was eventually passed in for $2.2m and is now advertised for private sale for $2.5m.

49 Bellett Street Camberwell

Hamish Tostevin (Marshall White) takes centre stage in front of a good crowd for this solid period home.

Bellett Street is an interesting street in Camberwell, as it features almost every domestic style of architecture Melbourne has offered. The house up for sale at no. 49 was of Californian Bungalow origin on a good parcel of land, yet the floor plan was a tricky one. The auction was protracted, opening with a crowd bid of $2.0m, which was quickly advanced by a vendor bid $100K higher. Bidding from several parties saw the auction break momentarily for a vendor referral at $2.425m, then ultimately pass-in at $2.45m. It sold after auction for $2.513m

Properties we like, coming up for sale early June:

2 Boyd Street, Albert Park – Gerald Betts/Cristina Porto, RT Edgar

5 Annadale Street, Kew – Robert Ding/Anton Zhouk, Marshall White

18 Asling Street, Brighton – David Hart/Stefan Whiting, Buxton

 49 Murray Street, Prahran – Anthony Grimwade/Oliver Booth, RT Edgar

Agent Opinion: The single-fronted period home has been one of the strongest performing markets this year in suburbs like Armadale, Prahran and South Yarra. Is this also true for your areas of focus – Albert Park, Middle Park, South Melbourne?

David Wood, Director, Hocking Stuart (Albert Park): Yes, the single fronted market is one of the strongest performing markets and has probably seen the highest growth in the last year of all types of property across our market.

 The key reason is the price range is right in the ‘sweet spot’ of price demand throughout the area and for that reason, it has also seen fierce competition from all sectors of buyers being home owners, investors, self-managed super funds and the renovators.

Auctioneer Tom Roberts (Nelson Alexander) entertains a healthy crowd at 132 Lee St, Carlton North. It was bought after auction for more than $1.1 million.

Victoria’s new quoting laws commenced this week, and there may be a short period of confusion for buyers regarding the quotes during the transition period, with a cross-over of properties listed for sale pre-May 1 and post-May 1.

Moving forward, buyers should expect, when visiting a property, to receive or sight a quoting sheet identifying (in accordance with the REIV price quoting changes and the Estate Agents Amendment (Underquoting) Act 2016):

• three comparable sales, taking into account the age, condition, size and location of the property;
• the suburb or town’s median house price; and
• the indicative selling price, which must be expressed as a single amount or a price range no greater than 10 per cent.

Comparable sales in metropolitan Melbourne must be within a 2km radius of the property and sold within the preceding six months, while comparable sales in regional Victoria must be within a 5km radius and sold within the preceding 18 months. When an agent believes there are fewer than three comparable sales that meet these parameters, they must state so. If the vendor rejects an offer above the estimated selling price, the agent is required to revise all advertising within a prescribed timeframe.

These new laws are a welcomed and overdue change for buyers, but they are only one piece of the puzzle and shouldn’t be relied upon solely when working through how to buy the home. Full due diligence will ensure an informed decision and the best outcome.

Further investigation needed when buying a house with a pool

The Victorian Government announced last week new laws that mean existing pools must be fenced, in compliance with current regulations. This must be done by 2020. Buyers should factor this in when looking to buy a house that features a pool that does not comply.

It will be interesting to see if prospective vendors act now to make their pools compliant in order to address this issue. With cost only one concern, the fencing of some older pools could be very difficult or even impossible in some circumstances. Some vendors may even need to consider filling in their pools.

Like anything, buyers should adopt the proper due diligence when buying a property. This is just another task to add to the list.

For more information, see ‘All Victorian pools will get fences: govt’  from the Herald Sun (4 May 2017).

Auction Highlights:

‘Land’ Sales:

Off-Market Properties:

Auction Spotlights:

36 Cochran Ave Camberwell

Richard James from Jellis Craig worked hard to entice a bid from the crowd in the front courtyard of 36 Cochran Ave Camberwell.

A period facade with modern renovation at the back was on offer here. The sun poked through for the auction, which was held in the landscaped front garden, with up to 100 people watching the action. There were plenty of features for auctioneer Richard James from Jellis Craig to espouse to the audience, but it didn’t seem enough to draw out an offer. After opening with a $3.4m vendor bid, he was forced to up the offer to $3.5m before eventually passing the property in on a $3.6m vendor bid. The property is now for sale for $3.8m.

15 Littlewood St Hampton

Paul Bond from Hodges received spirited bidding at the auction of 15 Littlewood St Hampton.

This home was marketed as offering access to a convenient lifestyle, being close to shops, the beach, trains and a selection of top schools. While the existing Edwardian offered an opportunity to extend and update, the 766sqm north rear site may inspire the new owners to start afresh with a family home or dual occupancy development (STCA). Paul Bond from Hodges had a good-sized crowd spread on both sides of the street to watch proceedings. Bidding commenced at $2.0m and moved swiftly among three bidders to pass reserve and put the property on the market at $2.4m. The final two bidders had to dig deep to outmanoeuvre each other for the home, eventually selling for $2.513m to the applause of the crowd.

Properties we like, scheduled for auction May 27

24 Norwood Avenue Brighton – Barb Gregory/Jason Collie, Marshall White

8a Central Park Road Malvern East – John Morrisby/Genevieve Hoyle, Jellis Craig

89 Armstrong Street Middle Park – Shane Siemers/John Holdsworth, Greg Hocking Holdsworth

29 Oak Street Hawthorn – Richard Winneke/Chloe Quinn, Jellis Craig

Agent comment: As one of the most experienced agents in the Stonnington area, what effect, if any, do you think the underquoting laws recently implemented by the government will have on the selling agents in Melbourne?

Iain Carmichael, Director Jellis Craig Armadale: The new legislation will undoubtedly provide more accurate price quoting for property buyers.

In a bouyant market, auction properties will often realise sale prices that are well above reserve prices; however, agents will now need to be more accurate when indicating likely reserves.

The changes will have little impact on those firms that are currently following best practice service delivery to buyers.

They will, however, shine a spotlight on those firms who feel that they might be able to ‘fudge arrangements’.

As an agency or a salesperson, unless you quote an ESP that reflects the vendors’ expectations/reserve price for the property, you are in breach of the new legislation.

After the Easter/Anzac Day break, we have a run of uninterrupted auction weekends ahead: will vendors be encouraged to sell and provide some good choices for buyers?

Today signals the first day of the new quoting rules for Victoria. There has been a lot of discussion and hype about this in the media; however, whether it will help or hinder buyers is yet to be determined.

If initial quotes are ‘higher’:

• Will buyers avoid inspecting properties advertised over their budget?
• Will the market rise further as buyers fight to be the highest bidder still?
• Will stock levels tighten up as vendors wait to interpret any effect?
• Will agent scripts and dialogues change at open for inspections?

In the meantime, the market has now resumed after the Easter/Anzac Day break and we have a consistent run of uninterrupted auction weekends, which will hopefully encourage vendors to sell and provide some good choices for buyers.

That said, looking forward to May 20 as the first bigger auction weekend, there aren’t too many ‘A’-graders to choose from.

Off-market sales have been quite prevalent in recent weeks, including a larger sale, circa $5.5m, in the Gascoigne Estate, Malvern East. There have also been good family home options, renovator delights and land sales transacting quietly over the past few weeks, providing plenty of options to buy.

Nearly a third of the homes we have purchased in the past six months have been ‘quiet’ sales. However, finding these properties can be difficult for buyers.

• How do you find the agents who specialise in these transactions?
• How do you know if the property is really for sale, not just testing the market?
• How do you know if the price is right?

Auction Highlights:

‘Land’ Sales:

And some land sales in Glen Iris the week before:

Off-Market Properties:

Auction Spotlights:

41 Westbourne St Prahran

Persistence paid off for Andrew James from Hocking Stuart in delivering a successful result for the vendors of 41 Westbourne St Prahran.

A good-sized crowd gathered on both sides of the street to watch the auction of this beautifully renovated period home. The property delivers on modern conveniences and luxuries in a sunny and character-laden package, all a stone’s throw away from Hawksburn Village. Andrew James from Hocking Stuart ran the successful auction, in between seamlessly directing traffic past the crowd. After starting proceedings on a $2.0m vendor bid and one bidder eventually putting his hand up, it seemed the property would pass in below vendor expectations. A second bidder joined at the last second and the two delivered spirited bidding to first put the property on the market at $2.27m, before the opening bidder succeeded in winning the property for a strong $2.51m to the cheers of the spectators.

34 Irymple Avenue Kew 

Great presentation, marketing and campaign saw an excellent result for this pretty house in Irymple Avenue, Kew.

A really good crowd of more than 100 gathered for the auction of this attractive, well-renovated Californian bungalow in a very pretty Kew East street. The stage was set – and the vendor had left no stone unturned to get a great result – with excellent presentation, great marketing and a well-conducted campaign. Auctioneer Antony Woodley walked back and forth in the street getting buyers and neighbours alike interested, and gave a concise preamble for this home. Antony looked for an opening bid and that didn’t take long – with a bidder coming in at $2m. Things clipped along constantly in $50 and $100K bids until bidder 1 dropped out in the $2.5m region. Three bidders come in to play, and the property eventually sold under the hammer for $2.48m – a very solid result. It seems there is no shortage of buyers for quality offerings, and no doubt many renovations may be undertaken in this area now, as many home owners will feel they won’t be over-capitalising.

81 Merton St Albert Park

A strong crowd braved the passing drizzle to see auctioneer Warwick Gardiner from Greg Hocking Holdsworth conduct proceedings at 81 Merton St Albert Park. More than any other type of property, Victorian row terraces have a lot of admirers but, when it comes to auction day, this admiration doesn’t translate into many buyers. Why? Terraces are not very liveable: they often need renovation but the floorplans don’t lend themselves easily to modern living – ie narrow stairs, small utility areas and lack of generous informal spaces. This property was passed in without a single bid, but sold after auction (price undisclosed).

Properties we like, scheduled for auction May 20

28 Hambleton Street Albert Park – John Holdsworth/Shane Siemers, Greg Hocking

28 Kintore Street Camberwell – Mark Josem/Alastair Craig, Jellis Craig

5 Central Park Road, Malvern East – Heather Elder/Rae Tomlinson, Marshall White

125 Linacre Road, Hampton – Rosslyn Mastrangelo/James Paynter, RT Edgar

Agent Opinion: As a very experienced agent in the Boroondara area, how are you seeing the demand for ‘land only’ purchases currently and how active have developers been in 2017?

David Gillham, Director, Noel Jones Camberwell: All land has been active, both to developers and private end users.

The overseas market is still strong. However, we have noticed a minor drop-off recently by developers of the higher density allotments suitable for apartments due to the amount of end product available and what is still yet to be built.

Camberwell is bringing $3,000 to $4,000 per sq mtr depending on location and land size.

There is still a little confusion in the public space regarding what the newish zoning really will allow and the recent about-face by the council due to public pressure has still not been clearly defined.

Hot Hampton market: a big crowd sheltered in the shade, where two young families bid for a property in Avondale St.

Those expecting the Melbourne property market to fall or flatten out will continue to wait, with yet another strong market performance this weekend. Under the weight of big numbers again, the strong inner Melbourne market held firm, with an REIV reported clearance rate of 82%. With nearly a third of the year gone, 2017 is shaping up to perform as strongly, if not even more so, than last year.

We have seen an increase in the number of pass-ins; some were sold afterwards and others are still waiting for buyers to rise to the vendor expectations, which agents suggest are on the rise. Next weekend is the last of the bigger auctions for a few weeks, as 8^th April falls in the middle of the school holidays. The Anzac holiday shouldn’t provide as much disruption this year, as it falls on a Tuesday.

Buying before auction

We are seeing more homes bought before auction. While this can be a good strategy for creating certainty, it can also be a costly one. You may pay $50,000, $100,000 or even more than any other buyer would have been prepared to pay.

Buying beforehand can help provide certainty if you know your offer is at a level where the vendor will sell. Generally, in this market, most offers will need to be at the vendors’ ‘dream’ price to stop the auction and the market is starting to show that some vendor price expectations are now well above the buyers’.

While an auction can be stressful, if you are going to venture into unchartered territory at levels otherwise not seen before, it may help in the following days, weeks and months afterward to know that someone else was also willing to pay nearly that price.

Auction Highlights:

It was also great to see the ‘Blott House’ (7 Allambi Road Chirnside Park), designed by arguably the best Melbourne architect of all time, Robin Boyd, bought by a buyer appreciative of the style rather than a developer appreciative of the land. Long live the King.

‘Land’ Sales:

Off-Market Properties:

Still quite a few of these around, here are just a few we have been privy to in recent weeks:

• Modern home with basement parking – Malvern – $8.5m

• Well renovated period home with great car garaging – Camberwell – circa $2.5m

• Dated yet good-sized separate titled townhouse with ground floor bedroom and secure car garaging – Camberwell – $2m

• Three-year-old double-storey modern home with prized north facing rear – Bentleigh – $2.5m

• Good-sized double-storey period home in an A-grade position needing cosmetic work – Hampton – $2.2m

Auction Spotlight:

8 Talbot Street Hampton

Mark Earle of Buxton Sandringham got his exercise reaching bidders spread along Talbot Rd Hampton.

A crowd of 50-plus spread far and wide along Talbot Street to remain in the shade, while witnessing Mark Earle from Buxton successfully auction this property. The home offers comfortable family living as is, or further opportunity to expand and refresh the period features, all set in 860sqm of private gardens. The proximity to amenities and schools certainly made the property appealing to young families, who bid strongly to secure the property for $2.926m, after exceeding the $2.75m reserve.

11 Retreat Road Hampton

Neighbours cheered to welcome the new family to Retreat Road at the end of the auction held by Stephen Wigley from Hodges.

A well-presented single-level family home delivering multiple living zones, good bedroom separation and a low maintenance garden with pool. Stephen Wigley from Hodges worked up a sweat in the humid afternoon, encouraging 4 bidders vying for the property. After announcing the property on the market at $2.17m, two families pushed the final result to a solid $2.245m.

Agent Opinion: As an expert who has worked in the suburbs of Kew and Hawthorn for many years, have you lately seen a change  in buyer demographics (ie where they are are coming from)? How is this affecting price?

Richard Winneke, Director, Jellis Craig Hawthorn: There is no doubt there has been a shift! We are currently seeing many buyers moving from the inner north, including Kensington, Maribyrnong and Brunswick, as well as the outer east, including suburbs such as Templestowe, Doncaster & Donvale. It does not seem to be having a direct impact on price other than just adding more buyers to the pool.

Big crowds, strong results: for good properties, the Melbourne property market continues to boom.

Strong. That is the word that best describes the Melbourne property market right now and, with underbidders at most properties, the ‘in demand’ properties (family homes and downsizers in particular) show no signs of slowing in the immediate future. While interest rates remain low and overseas arrivals (including returning Australians) stay high, there just is not enough supply of the right homes to satisfy the demand.

It seems at the moment that, irrespective of any negative aspects the property or surrounds may have, some buyers are prepared to just keep bidding to secure the property, with new records being set weekly across Melbourne.

Perhaps this is a good decision if you can guarantee that you won’t be impacted by any changes in the market or family changes that may occur in the future. While we believe it is important for our buyers to understand what might happen at auction and the levels they may need to consider, we also discuss the levels that may put them at future risk.  Stop limits are just as important, particularly if the property is not an ‘A’ grader.

Of note, there were multiple homes that achieved above $4m on the weekend

• 4 Osborne Court Hawthorn
• 684 Orrong Road Toorak
• 22 Leura Grove Hawthorn
• 2 Monomeath Ave Canterbury
• 52 The Avenue Prahran
• 45 Victoria Street Sandringham
• 10 Crest Avenue Deepdene
• 31 Mathoura Road Toorak
• 6 Webb Street Brighton
• 137 Yarrbat Avenue Balwyn
• 1-3 Palm Grove Balwyn

As we approach the Labour Day weekend, the market will take a mini-break, with minimal auction activity (and agents will catch their breath). All eyes look forward to another big auction weekend on March 25.

For those wanting to buy in the Port Phillip council area, however, March will be interrupted again with the running of the Grand Prix.

Auction Highlights: 

‘Land’ Sales:

If you design smart and build well you can do well is this market.

Of course, enlisting the services of a good architect really helps.

Take this example: 14 View Street Hawthorn (Architect, Steve Domoney – Agents, Richard Winneke/Campbell Ward – Jellis Craig) sold a few weeks ago at a mid-week auction for an undisclosed amount over $5.7m after being purchased before auction in May 2015 for $2.1m. 

From an architect’s eye, this is what we thought of the property:

 Auction Spotlight:

 31 Mathoura Road Toorak

Jeremy Fox from RT Edgar delivered an entertaining and successful auction at 31 Mathoura Rd Toorak.

About 100 people gathered to watch the auction of this well designed, light, modern family home. With the road temporarily blocked to cars by development further down the street, auctioneer Jeremy Fox from RT Edgar had a broad stage to interact with the audience who thronged both sides of the street.  After an opening bid of $3.75m, four bidders pushed offers past the reserve of $4.1m.  Joking with the bidders to entice further offers, the home was eventually knocked down for $4.115m to a round of applause from the crowd.

133 Head Street Brighton

Andrew Hayne in action at 133 Head Street Brighton – quick-fire auction, property sold under the hammer for $2.905m. Listing agent Fiona Ansell-Jones.

There was a serious vibe at this auction and fair enough – the property had a lot going for it: Edwardian facade, practical floorplan and prized north-facing rear aspect. A good crowd of about 120 attended, and a lowly bid of $2.2m (was this real?) got the auction started. It didn’t take too long for a further two parties to take place in the bidding and the property was announced on the market in the $2.6 millions. Faltering in the $2.8 millions, the two bidders went back and forth and the home eventually sold for $2.905m – a very solid result, it must be said.

Auctions we like, scheduled for March 25

6 Seymour Avenue Armadale – (Gowan Stubbings/Julia de Campo, Kay & Burton)

10 Derby Street Camberwell – (Geordie Dixon/Richard Earle, Jellis Craig)

66 Tivoli Road South Yarra – (Justin Long/Mark Harris – Marshall White)

9 Southey Street Sandringham – (Stephen Wigley/Cain Malthouse, Hodges)

Agent Opinion: As an agent who has worked in Brighton for many years, what do you see as the fastest growing market in Bayside at the moment?

David Hart, Director – Buxton Brighton: Without doubt, land. Week in, week out we need to re-calibrate Brighton and Brighton East land prices as new benchmarks are set. Anything in a convenient position, with room to build either a single home or multiple dwellings, is creating amazing competition. We had a recent land value property of 613sqm in Arthur Ave where the vendor wanted it sold quickly. After a week on the market, we had nine buyers register their interest to attend an informal midweek twilight auction, where it sold for $400,000 over reserve.