Week 4 September 24th: Overall market interest is down this week, best evidenced by the fact we had 30% less Marketnews readers on the Monday of this week than the past two month average (alternatively we may be just getting boring). While some new AFL coaches bobbed up, so have some interesting homes and it may be worth your while to revisit your contacts to see what new offerings are on the horizon. The internet portals are showing more homes in the Upper End than they have for a while and this is due to the agents planning an extended campaign to manage arrange the Grand Final while still trying to get the home done and dusted prior to the Melbourne Cup. So this week may have been more interesting than you thought but soon it will be back to “quiet and low new stock” as far as listings go until the second week of November post Melbourne Cup (hopefully).
Biggest Sale: 2 Albert St, Brighton, Leigh Hallamore (Buxton); after auction, in excess of $3,100,000, 3 bidders
With a relatively big crowd of 60 lining both sides of Albert St, there was a feeling in the air that this auction would be an exciting one. And, although he had to open on a vendor bid of $2,500,000 to kick-start proceedings, auctioneer Leigh Hallamore soon had a tightly contested battle between three parties on his hands. Bidding was strong and constant with bidder 3 eventually earning the right to negotiate after the property was passed in at $3,120,000. Bought after for an undisclosed amount. (Jen Milligan)
Biggest Pass In: 324 Beaconsfield Pde, St Kilda West, Andrew Stuart (Hocking Stuart); Passed in, $5,000,000, no bidders
Auction Andrew Stuart took great pleasure in explaining to the crowd how the under-ground car lift and turning circle worked – with a practical demonstration. Demonstrations over, Andrew asked for a bid somewhere near the lower end of the quoted range. No one offered a bid and a vendor bid of $5,000,000 was made – still no interest and half time was called. Half time was short and sweet. The property was reoffered again and surprise, surprise – no bids and the property was passed in at $5,000,000. It has been a long time since a property on Beaonsfield Parade has sold under the hammer. Sales are being transacted its just taking some time for vendor and buyer to reach that all important middle ground. (Guy Angwin)
Bidderbuzz Auction: 25 Campbell Rd, Balwyn, Antony Woodley (Marhsall White); under the hammer, $3,000,000, 5 bidders
Antony Woodley took the helm and fielded bids from 5 parties before the hammer fell at $3,000,000; after being on the market around $2,700,000. Around 70 people attended this auction. Full report in Market News (Adam Woledge)
Some clean ups from previous auctions and another few off markets and quiet results for the month.
- 34 Tormey St Balwyn North – James Tostevin – after auction for around $3,000,000
- Brighton 12 North Road – Jonathan Dixon – off market – over $5,000,000
- Toorak 67 Lansell Road – Andrew Harlock – after auction – over $3,500,000
- Toorak 1 Sargood – Lachlan and Paul Castran – Expressions of Interest – new home – undisclosed
- Balwyn 49 Metung St – John Bradbury – Expressions of Interest – new home – undisclosed
- Kew 26 Dean St – James and Hamish Tostevin – Expressions of Interest – new home – over $4,000,000
Week 3 September 17th: Good quality Top End (around $3m and above) continues to change hands in strong numbers.
- 40 Balwyn Canterbury Peter Dixon over $3,000,000
- 37 Fairview Hawthorn Jeff Gole just under $3,000,000
- 3 Gardiner Hawthorn Hamish and James Tostevin – 5 bidders $3,850,000
- 41 Drummond Carlton James Keenan – $3,160,000
- There were $3m pass-ins at 111 Walsh South Yarra and 2-4 Sandown in Brighton.
During the week these $3M+ were bought
- 48 Hampden Road Armadale Andrew Baines over $6,500,000
- 45 Martin Brighton Ian Jackson just under $4,000,000
- 42 Matlock Canterbury Sam Wilkinson just over $3,000,000
- 198 The Esplanade Stewart Lopez – were quoting in excess of $6,000,000 – undisclosed
This September, to date, we are aware of 26+ sales in the is $3m and above price range – see our $3Million Plus report. If you look at our $3Million Plus market report for last year, September 2010, we got to 46 boughts by months end – http://marketnews.com.au/2010/09/two-9-million-homes-bought-on-monday/ and that was pretty much a solid activity time in the market. The Top End has some ooomph just now.
Michael Gibson and Justin Follett of Kay and Burton were both a bit chipper when I spoke to them this weekend and assured me that while the market may seem a little boring until the end of the school holidays, there are some good homes coming on after that. Hopefully post Melbourne Cup as well. Michael added that vendor moods have improved with the Top End good news of recent times. We hope he is right as that will mean more choice for buyers.
Week Two September 10: With the third week in a row of significant competition on A grade Top End homes there is little doubt we are now firmly in the midst of an activity spike due to significant stock shortages of “ready to move in family period and new homes” in the $2m to $6m range.
On top of what we saw 2 weeks ago (11 sales at $55m with an average of 2 bidders each) and last week (7 from 8 bought over $3m) we saw solid results this weekend at:
- Kew 20 Barry – Peter Batrouney 3 bidders, under the hammer, $3,850,000
- St Kilda 78 Blessington – John Bongiorno $3,400,000, 6 bidders.
- Armadale 46 Stuart – Andrew Hayne 2 bidders, after auction, over $3,300,000
- Malvern East 58 Kerferd – John Bongiorno, 1 bidder after auction, $3,075,000
- Malvern East – Little Como – 50 Finch – Gowan Stubbings – Expressions of Interest – It was a long battle but there is a sold sticker on the board.
- Toorak 8 Ultimo – Justin Long – After Auction – 3 bidders – $2,900,000
Whilst the market is giving a big tick to those it likes (well priced A graders); it is marking very harshly those that is doesn’t and they are best summarized as B or C graders – homes that have issues. Some examples below
- Toorak 32 Canberra – its old and tired – big land though.
- Kew 2 -4 Heather – No backyard, no garage and no real interest.
- Malvern East 4-6 Finch – 0 bidders – a big reno required and only a few metres from Dandenong Road
And then there is 22 Surrey Road Toorak – Auction was due today – converted to Expressions of Interest at the last minute. What does this mean?
Yes our focus in Marketnews seems to be all at the top of Top End ($3M+). Right now that is where the real action is. There has been an unequivocal mood change that does not seem to have been shared by the market at the lower dollar values.
Buyers are now having to answer some very real questions.
What is the real price? – Eg What is the highest other bidder prepared to pay, if indeed there is one? As a buyer am I trying to buy an A grader or a C grader – am I $300,000 below the other bidder or $300,000 above nobody!
What should my new strategy be in trying to purchase a Top End home? Extract from an MW St Kilda auction report “This market now plays to MW’s great little system and strength – shake the buyers up, show ‘em their competition, work out who is the strongest, then pass it into them and mentally torture them in post auction dealings by referring to those outside. It’s very hard to argue with it’s effectiveness, for if you don’t play the game, on a good home in this market, then there is a high chance somebody else will. This market is now spiking in the direction that will enhance MW’s reputation amongst sellers but … um how do I say un-enhance their reputation amongst buyers.” This applies to not only Marshall White, but Jellis Craig, Kay and Burton, RT Edgar, Benmac and many of the Bayside agents. The main question for buyers is not it’s legitimacy (the sellers absolutely want this); its how do I best manage it and achieve my main goal within my buyer risk profile.
How will you manage a negotiation situation under extreme pressure – then is not the time to work out a plan. After the event is not a time to say I could have done it a lot better. The market has changed at this level, and may well change again, as a buyer have you moved with the times?
Week One September 3: My week this week. A good week with another $3M+ purchase for a satisfied client – which makes a good string of activity in the last month for our company. Overall a solid start to Spring after a less than exciting Winter (well I enjoyed Scotland with my son anyway). A magic moment for me was the home at 8 Torrington Place in Canterbury (Michael Armstrong of Kay and Burton). We will have a rating up in the next few days – but in a nutshell it’s a very brave new build home. Its Olde English for a start, which already loses most of you; but it is built to such a standard that when its attracts a suitor to its sweet offerings they will be entranced and will move to a mindset of I have to have this. The French Provincial being built next door will attract more; but this home will attract a greater intensity of interest. The price – well its asking $5million and for me the end result will be give or take a million and the sold sticker will be slapped on in an almost impossible to guess timeframe. That will depend on when the specific bee walks into this very specific honey pot. A lovely, well thought out, beautifully crafted home – go and check it out – its open mid week and weekends or google for our rating by weeks end. Please we are happy to be more specific on perhaps how best to buy it; if indeed it’s of interest to you.
My other magic moment was the 29 Rose St Armadale Auction: I really love watching Heather and Rae (Marshall White) at work – they are masters at their craft also – just like the developers of 8 Torrington. The two of them had positioned buyers on this home (last sold for around $2,500,000 in mid 2008) to get involved in the biggest shootout I have personally witnessed at an auction this year. And they lined up one of the best sheriffs to take all-comers on – Growling Jack (John Bongiorno) and boy did he fire up – to use the vernacular he stuck it right up ‘em and corralled 9 bidders into the final $3,030,000 result. It was very powerful to watch and while not reflective of the overall market right now, it did provide a pointer to the current lack of stock at the $3m+ level and a beacon for those that feel the only way forward is without hope. Sure we are all a bit nervous, but things are simply not as bad as The Age daily headlines make you think they are – well not right now in the $3m+ segment anyway.
Again the standout $ segment – granted on very low numbers ( 6 from 8 ) Yes there were some big pass-ins like 67 Lansell Road Toorak ($3,200,000 vb) but it has some challenges. Also passed-in 2 Iona Toorak ($5,000,000 vb) – postscript: was bought over the weekend. However the ones that were bought this week showed, in the main, multiple interest.
- Toorak 2 Iona – Jeremy Fox – bought after auction $5,080,000
- Armadale 29 Rose – see report below 9 bidders $3,030,000
- Malvern East 7 Bates – Heather Elder and Rae Tomlinson – 3 bidders – bought after for $3,500,000+
- Hawthorn 34 Coppin Grove Jack Bongiorno – 3 bidders – under the hammer – $4,110,000
- South Melbourne 210 Nelson – Anthony Grimwade – 3 bidders – under the hammer – $4,215,000
- Toorak 19 Sargood – Jeremy Fox – 2 bidders – bought after – $4,700,000.
- Balwyn 12 Creswick – William Chen – Bought Before – Undisclosed – around $3,000,000 . This was after a failed auction earlier in the year.
- Canterbury 52 Mont Albert – Karen Gornalle – Private Sale – over $3,800,000.
- Hawthorn East 5 Constance – John Chartres – After Auction – just under $3,000,000. 2 bidders.