May 28, 2016
Although the cold weather is kicking in, the sentiment at auctions and the Melbourne property market in general is still warm.
We saw a good number of homes auctioned on the weekend, however, the numbers are still down about 15% on the same time last year and results are healthy with the REIV reporting a clearance rate of 74%.
Off Market or Private Sale/Pre Market
The words ‘off market’ appear to be the modern replacement used to describe listed properties for sale, where the vendor wants to sell their home privately or want to ‘test the water’ before a full blown auction campaign.
Many email alerts to buyers are now headed ‘new off market opportunity’.
There is something special about knowing about an ‘off market’ property compared to a ‘private sale’ or ‘pre-auction property’ – it suggests you are receiving a special opportunity that other buyers haven’t had.
If you are considering an ‘off market’ opportunity, thorough due diligence and a good understanding of the process will help ensure you buy well.
For details of the auctions we covered on Saturday, see our twitter feed HERE:
Demand for good land is still solid, with developers and building companies actively participating in the market. Some neighbours are still banding together in growth land corridors so that their properties can be consolidated for multi-residential development, taking advantage of the recent directives from government to promote development in key areas and retain neighbour character in other areas.
- 91 Radnor Street Camberwell (Peter Vigano/Sally Morrison, Jellis Craig) – 698sqm with a liveable, rentable home, bought after auction – $2.03m or around $2,900sqm. Next door is auctioning on Saturday – although a lesser home. Prices here seem to be holding fairly steady – last year 57 Bowen Street sold for $2.33m – slightly larger land, lesser house and a better part of the street comparatively.
- 54 Baker Parade Ashburton (Cameron Edgoose/Daniel Wheeler, Marshall White) -large land holding in a good location, 859sqm with a 20m frontage – circa $1.7m or around $2,000sqm.
- 21 Wolseley Grove Brighton (Greg Costello/Rowan Thompson, RT Edgar) – 694sqm corner block, north rear – $2.405m or $3,465sqm.
- 54 First Avenue Kew (Todd Braggins/Duane Wolowiec, Marshall White) – 650sqm and although a south facing rear, it is a good side of the street due to block slope – $2.003m or $3,081sqm.
Quality townhouses in good locations remain desired in the market place, however where there is an oversupply in a precinct or the quality of the finish and/or layout is not up to buyer expectations, these can remain for sale for some time. As a townhouse buyer, it is easier to make a mistake if you buy the wrong townhouse.
- 111 Stokes Street Port Melbourne (Michael Sculz/Simon Carruthers, Cayzer RE) – sold in July 2014 for $1.75m, on the weekend – $2.16m
- 59 Staughton Road Glen Iris (Bryan & Chris Cain, J.A Cain RE) – a new Metricon build – $1.802m
From an Architect’s Eye – What makes a good townhouse?
Increasingly we are getting briefs from our clients to buy townhouses. Some important things to consider when searching for a townhouse include:
- Proportions – what room sizes and ceiling heights make for a good space? 2.4m ceilings are too low
- Fit-out and fixtures – does it match suburb expectations? Over spec-ed may have as many negative implications as under
- Is there a premium for a downstairs bed/bath combination? How much less is a property worth without one?
- Garaging and security is important
- Private courtyard area – is this balanced with the size of the home?
- Location – what amenities is it close to?
- Additional expenses – are there body corporate fees or additional insurances?
A few new properties this week:
- Smaller period home – Hampton – circa $2m
- Well renovated original home – Ashburton – $1.6m
- Modern two storey home – Glen Iris – mid $2ms
- Modern home in blue chip Balwyn – early $2ms
- Classic architect designed townhouse – Toorak mid $1ms
Brighton, 11 Butler Street (Peter Kakos, Marshall White), sold $3.751m, 3 bidders
An entertaining auction from the get-go. Peter Kakos took centre stage in front of a generous crowd of around 60 people. One of the last auctions of the day and the air was starting to feel a little crisp. A vendor bid of $3.4m was tabled to kick-start proceedings, but we soon had two, then three bidders vying for the architect-designed property in the heart of Brighton. At $3.605m Peter announced the home was on the market and a flurry of bids – both big and small – ensued until the hammer came down, eventually, at $3.751m.
Agent Opinion: “We’ve heard from agents in the Eastern suburbs that the market has softened following the changes to FIRB rules. Have you noticed any changes around the McKinnon/Bentleigh areas, in particular the school zones?”
Peter Sinclair (McGrath, Bentleigh): “The mood in the market has changed, no question. The increase in the stamp duty surcharge, the banks shutting the doors to non-resident borrowers, developers struggling with the time it takes to get permits through council and now a Federal election in a month or so creates lots of chatter in the buyer community. McKinnon Secondary College zone is a different beast though; for decades, there has been a force field surrounding this part of the market, just like Balwyn, Glen Waverley etc. It seems bullet proof and is not affected to anywhere near the same extent when there is a market correction. Buyers are looking through the south eastern and eastern corridors for secondary school opportunities; no doubt in the past twelve months, the McKinnon Secondary zone has seen significant price increases because of price increases in surrounding school zones. Even the Bentleigh East section of the school zone, where traditionally prices have been a little lower than other parts of the same zone, has now caught up to Bentleigh, Ormond and McKinnon.”