The first real auction day of 2012 started quietly out of the blocks, but by the end of the day overall demand was not too bad.

CAMBERWELL, 46 Gardiner Pde, Mark Williams (Marshall White), bought $1,925,000, 1 bidder: The crowds were out in force but the results didn't necessarily match.

Hellooo Melbourne Million Dollar Plus Market Watchers and welcome to our first edition for 2012. Two big Melbourne sporting events started again this weekend after a summer hiatus – the Pre Season NAB Cup and the Melbourne Auction scene.

On the auction scene, overall was not too awful. At 6.00pm Saturday, the James Clearance Rate for $M+ in Inner East and Bayside was 58% on the 31 auctions we attended. The , our demand indicator, began the year at 1.5 bidders per auction.

This weekend’s numbers were low, at just over 50 in that $M+ bracket. But next weekend will have well over 100, a solid number. And we’ll see a similar number on March 3 before we have a significant drop on March 10 due to the Labour Day weekend.

Market Wrap-up

  • Overall the market appeared weaker on early results, i.e. under the hammer. As the day wore on though, and pass-ins were cleaned up, the indications were that the market seems to have started as well as could be expected. But it’s too soon to say it’s a clear positive trend.
  • Stock levels on offer were low in number, in quality and in dollar value. Only two auctions had results over $3m – one sold and one didn’t. So it’s still a bit foggy to us.
  • A number of pass-ins were cleaned up post auction – meaning a lot of the action was not visible this weekend.
  • The phenomenon that became very evident late in 2011 has continued in 2012. This weekend we counted 46 bidders at 31 auctions – so there is demand out there. BUT there was no evenness: five auctions had 50% of the bidders averaging almost 5 bidders per auction and the other 26 auctions averaged just under one bidder per auction.

‘Round the Grounds:
– Low levels and mostly unexciting stock, so 56% is an even result.
– Actually that’s pretty impressive first up – 83% clearance.
– Solid start on low numbers  – 75% clearance
Port Phillip
– Whoops – somebody forgot to tell the buyers auctions had started again – 20%

Market Summary – Year to Date 2012.

2011 was a year of generally falling prices – with the exceptions of the months of May, September and December. Yes we finished the year off OK, but it was more a case or arresting the fall rather than any lighting of price rockets.

Last year we saw drops in market values on homes that started too high on price, with owners that then had to sell. This was particularly the case with properties that were of inferior quality or in poor positions. In many cases these drops were 20% and more off the Anzac Day 2010 high. A lot of that fall in value happened in the last quarter of 2011.

On the subject of price falls: some organisations are spruiking median price increases in the last quarter of last year as real stats, which only proves that there are dope tests that can have false positives. The market did have some strong results in December but overall it was a negative second half for many sellers (in terms of lower selling prices or not selling at all).

So how have we started 2012? In a word QUIETLY.

By any previous year’s measurement, 2012 has been pretty quiet out of the blocks – except for agent claims of numbers through opens.

  1. Only a handful of $3m+ buys (see our report)
  2. Little new stock of high calibre at this price level came onto the market in February. This is particularly so in the Inner East. March may turn out to be different from what we are hearing and seeing pre-market with a number of sellers keen to get a result prior to our early April Easter. But that is conjecture until we see March new stock numbers confirmed.
  3. When the market is quiet, agent turnover drops and so do agents’ incomes; unrest builds and the merry-go-round begins. During late 2011 and early 2012 agent coffee shop meetings have been up.

So yes, the market still seems a little quiet, but it’s not that bad. It’s pretty much as expected and this weekend went as well as a selling agent could have hoped for….

What of the claimed increase numbers at open for inspections? We actually support this premise and the implication that demand may be stronger than the results show.  Our enquiry numbers are up and the number of clients looking for homes is also up on this time last year, even if we’ve seen little change in the number of clients in actual negotiation this year compared to last. Result-wise we also started OK, with buys in Fitzroy, Glen Iris and Brighton in the $1m, $2m and $3m price bracket in early February. Over January we were closed as we always are.

Demand being OK can be further supported by our Stale and Stalemate results. As we went into Christmas we had four key $2m to $3m negotiations in stalemate, in that the vendor was fixed at X and our buyer was fixed at Y. It was a stalemate as opposed to a momentum negotiation because the vendor felt no compulsion to lower their price and our buyer had no proof as to why they had to increase their bid.

Ten weeks later, the results on those negotiations are:

  1. Burke Road Malvern – Marshall White’s Maddy Kennedy got a surprising near $3m offer from another buyer. It was a really good home but in a difficult location and the auction only produced a vendor bid of $2.4m. Tick to seller.
  2. Victoria St Brighton – Barb Gregory of Marshall White Brighton. Another buyer met the reserve of $3.5m. Not surprising – this was a good home and fair price. Tick to seller.
  3. Moffat St, Brighton – Bought after some argy-bargy with Chris Bevan of JP Dixon. This was a brilliant design and build and had been on the market for over a year. Tick to both buyer and seller.
  4. Camberwell – This is still in a stalemate negotiation, and with other blocks nearby also unsold it’s hard to tell when or even if something may happen on this. No ticks.

A word from the experts: How has the year started?

David Hart, Buxton (Brighton): “Traditionally the Brighton market is pretty slow to gain momentum with regard to stock levels. This year is certainly no different, with a shortage of quality listings across the board.”

Richard Winneke, Jellis Craig (Hawthorn): “The year has started very strongly. We have seen an average of around 20 groups per home (compared to Spring last year with around 10-15). Six out of six $1m+  homes sold at auction on February 11 with Jellis Craig. Many buyers are wanting to buy and are putting  in offers before auction.”

James Connell, Marshall White (Armadale): “It has been a good start to the year with a lot of good activity, positive activity. However, it is still  too early to judge the extent of the momentum.”

BRIGHTON, 1 Farleigh Grove, Greg Costello (RT Edgar), under the hammer, $2,222,000, 6 bidders

Early 2012 Top End Private Sales

  • Brighton East, 181 Were St – Kate Strickland – Over $3m – Cutting edge home – Big price for East Brighton
  • Brighton, 10 Victoria – Barb Gregory – Over $3.5m – Modern 7 yo family home near the water
  • Brighton, 17 Huntingfield – Regina Schmidt and Brian Devlin – Over $3.3m – Big family home
  • Brighton 2 Collins Brighton– Regina Schmidt and Brian Devlin – Over $3m – Townhouse, one of a pair
  • Brighton 26 Moffat Brighton – Chris Bevan – Cutting edge family home
  • Balwyn, 15 Boston – Mark Rathgeber – $3,300,000 – Big family home
  • Hawthorn, 58 Kooyongkoot – Scott Patterson – Over $3m – Family home
  • Prahran, 22 Murray – Tim Wilson – Over $3m – Big land
  • Kew, 65 Stevenson – Paul Richards – Big period home – $3m

ALBERT PARK, 148 Beaconsfield Pde, David Wood (Hocking Stuart), under the hammer, $3,010,000, 4 bidders

3 Biggest Auctions:

Albert Park, 148 Beaconsfield Pde, David Wood (Hocking Stuart), Under the hammer $3,010,000, 4 bidders
A strong crowd converged under the hot Melbourne midday sun to see if this beachside property would find a new owner…. (See more in Auction Reports)

Malvern East, 56 Central Park Rd, Iain Carmichael (Benmac), After auction, $2,680,000, 1 bidder
Great setting for an auction – on the street, across the road from Central Park. This certainly highlighted the big plus of the property – it was all about position…. (See more in Auction Reports)

Sandringham, 10 Victoria St, Peter Kennett (Hocking Stuart), Under the hammer, $1,935,000, 3 bidders
This home had been offered for auction late last year so I, among many of those gathered, was keen to see what would happen when it was offered this time around…..(See more in Auction Reports)

Top Bidderman Auctions:

Brighton, 1 Farleigh Grove, Greg Costello (RT Edgar), Under the hammer, $2,222,000, 6 bidders
My first auction of the year and I’m a little toey as the auction bell rings. It’s not nerves, more anticipation. You see I think it will fly along and I’ve been starved of the buzz of an auction for 8 long weeks…(See more in Auction Reports)

Kooyong, 13 Talbot Cres, Andrew Summons (Hocking Stuart), under the hammer, $1,161,500, 5 bidders
A perfect sunny day provided the backdrop for a great auction and a spectacular auction it was. Auctioneer Andrew Summons took centre stage and in his preamble spoke enthusiastically of the property with its delightful period features and north facing backyard, with the Kooyong location providing a village atmosphere….(See more in Auction Reports)

South Yarra, 21 Nicholson St, John Bongiorno (Marshall White), under the hammer, $1,525,000, 4 bidders
This fine double-fronted Victorian cottage made for the perfect back drop for this auction. And centre stage is where auctioneer John Bongiorno does his best work….(See more in Auction Reports)

Biggest Pass Ins:

Camberwell, 3 Christowel St, Paul Williamson (Jellis Craig), passed in, $3,025,000, no bidders
One of the first big Melbourne auctions of the day (if not the year), and it was much anticipated…(See more in Auction Reports)

Brighton, 20 Birdwood Ave, Stewart Lopez (Kay & Burton), passed in, $2,700,000, no bidders
A good sized crowd of around 40 people were on hand to watch this auction, led by the affable Stewart Lopez…(See more in Auction Reports)

Buyer Masterclass: Should we wait or should we buy now? Read Buyer Masterclass, this Wednesday.

Big Issue: Our next market video will be up this week. Check out the live action.

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