9 Buyers near 9 Million in Glen Iris – Hello Dolly!

Deadset a nice guy and a hard worker. Andrew Gibbons (Gibbo) brings down the hammer with a smile on 48 Roseberry Hawthorn East. Volcano at $1,885,000

Dead Set – always smiling and hard working. Andrew Gibbons (Gibbo) brings down the hammer with a smile on 48 Roseberry Street, East. Volcano at $1,885,000.

BIDDERMAN120518

At 6.00pm on Saturday, in the second week of our three week May 100 Auction Test, it’s all becoming a little ho-hum – stats wise. The James Clearance Rate for $2m+ Inner Melbourne family homes is a borderline ice-berger 63% on the 35 auctions we covered.

Bidderman was up a skerrick to 1.6 bidders per auction but this is on unusually low stock numbers for the usually big month of May. The sellers have run for the hills and many of them won’t be checking back until spring.

So today we are examining the markets in more depth – we are drilling down to give you real on-the-ground, almost street-by-street insights.

This year in terms of auctions, Bayside has been like a morgue. Today it was different, the deals were being done – bidders were out – sellers have begun to meet the new market.

Contrast this with – 6 from 7 didn’t sell today.  And the reason was clear – seller versus price expectations – on the high-end homes we covered.

Sellers –  there is nothing wrong with being a “Castler” (tell then they’re dreaming) – I would be too on a good home – as even Mike Moore from Frontline knows where this market must eventually return to, whilst population remains growing as it is.

Happy Mothers Day tomorrow to all Mums – I love you Mum!

The Reverend Sam Paynter had a parish of one at 58 Draper Street Albert Park and he converted the buyer from $1,820,000 pass-in to a $2,030,000. Mmmmm uplifting

The Reverend Sam Paynter had a parish of one at 58 Draper Street, Albert Park and he preached and converted from a $1,820,000 pass-in to a $2,030,000 post-auction sale. Mmmmm uplifting!

MelbourneFHP

Continuing on our series for Younger Homebuyers.

Over the next few years, we plan to build for further inter-generational living, on a plot of land in .

We have had grandparents and parents and children living communally here for 20 years.

We have been through the issues of separations, illnesses, really old age, really young children, super and yet we have remained together.

We are now facing the next big challenge – how we bring the fourth generation on, with the 1st, 2nd and 3rd generations having the space and freedoms, without the punishing mortgages.

This is what the James Family Project is all about and we are intending to share with all along the journey; in the hope that you and your family can work through your ways and live a great family life in Melbourne in the 21st Century.

Enjoy this video introduction from a brilliant young trainee architect James Hayward.

StateofMarketThe market continued along its seemingly “vagarific” way today – one auction doing this and another auction not doing that – but there is becoming an increasing air of predictability about many of them, depending on the individual alignment of the 3P’s (Price, Property and Position).

This doesn’t mean we are getting every prediction on every home right. We as a collective of professionals are not yet passing the “murder verdict” standard and able to give you a beyond reasonable doubt prediction on any home – but truth be known –  when talking to clients most of our predictions would pass the commercial law test of being right on the balance of probabilities.

Last week we reviewed the overall market, so this week let’s look beyond that and drill down into the smaller segments, because the market is not Uluru (singular and rigid), it is the Great Barrier Reef (alive and made up of many little pieces).

This current market has a different driver, one who is taking us in reverse and that may well be a good thing.

That driver is ScoMo and the swingers at The Reserve Bank / Apra. However, in our mind, they can only be temporary helmsman and women.

The current down market of May 2017 to May 2018 is more and more beginning to feel like it may only be a brief interval before we get back to the movie we were seeing 2012 to 2017 – full on and up.

We say this based on  – yes, we know it’s boring – demand and supply.

Melbourne’s underlying market remains robust and what we are seeing on Saturdays are no more than waves on an ocean. There feels an increasing solidity underneath the surface – admittedly on low stock numbers – a by-product of how the market is talking to sellers. The fall appears to be flattening.

The bucket is almost full (Melbourne Land = supply) and the tap is still full on (immigration = demand) – we are now slightly below capacity as there are a few holes (tightening bank credit and buyer indifference). Once those holes are plugged with a doughy mixture (like the pun?) of returning urgency and credit/overseas cash, then the interval will cease and we return to the main game. UNLESS the underlying issue is addressed = rapid population growth in a sophisticated economy.

Let’s alight the tangent and return to this week’s theme;

Drilling down on the 3P market segments (Price – Property – Position) and relating that back to what is happening to Price.

newpicmn120518

This diagram above is a screenshot of our backend (pardon me, I mean behind the scenes statistics) and it drills down on the importance of making Uluru market statements (one and rigid) versus understanding Great Barrier Reef mini-markets (many and lively).

Today we covered 7 auctions in Kew – 3 years ago it was Melbourne’s most influential suburb. However, since May of last year, although the tap hasn’t been fully turned off, there has been a big kink in the money hose (Overseas Asian Money).

(1) Geography in Kew  – 6 of the 7 homes (randomly chosen) passed in (3).

No, it wasn’t the agent (2) – different agents on the pass-ins.

Since May of last year (and even a bit longer) Kew has been a bit off, as many sellers have remained attached to 2016 prices (resulting from high Asian demand) without acknowledging the 2018 reality of significantly diminished demand.

Dollars also affect price – Huh? Well, look at (4) – the new black in real estate. No, not good new black, it’s bad new black, all muddy and dark is the $3m to $5m segment. Basically, the banks are controlling this market and they’ve turned the lights off on interest only, bridging and high LVR’s. Less certainty from locals combined with fewer overseas buyers has turned this dollar market segment of concrete from a freeway to a graveyard.

And finally, look at Bidderman (5) – less than 1 – in Kew! Oh Mal and Gina, the homes must be appalling.

4 Marshall is a good home with a few issues – see our James Home Rating 771, admittedly with Chris Barrett at the helm, this will be more about a good negotiation rather than a non-sale. 6 Hillcrest is land, 10 Argyle a single level, 10 Finhaven an older 1980’s Asian special, 31 Wrixon has a nice period front, 36 Yarravale is a nice looking home. No impossible to sell homes here – but they obviously now have B-grade characteristics and our best guess is that it’s Price on all these.

Two years ago it would have been an auction clean sweep 7 from 7, in 2018 it’s a different story as A-Graders can become B or C-graders on Price alone.

Price = Demand and Supply and whilst demand remains strong for A-graders, it is noticeably weaker for B and C graders.

CURRENT MARKET DOCTOR

Here is the flip side of the coin, which we experienced yesterday as the underbidder at 4 Fairview Grove, .

2000 sqm, tennis court, brilliantly designed (Architect – Christopher Doyle) and built period home. It looked so fresh and yet it was 10 years old – all of this for $9m in Glen Iris.

STOP THE VIDEOTAPE, did you say $9m in GLEN IRIS? Is this a joke Mal, a misprint?

How can you have a home go for $9m in Glen Iris, in this market?

Easy:  Price = Demand and Supply.

With a James Home Rating at 806, 4 Fairview was the bluechip“ist” and “A”ist of almost A-graders we have seen this year and that in part is why it went for $9m with 9 buyers – 6 bidders over the reserve.

4Fairview

Let me explain; we were there, and we are still crying. Sometimes you do all that you can and it’s a lot and you still get beaten – in those circumstances, we find there are usually no lasting regrets – but it does hurt for a little while.

The agent quote was $7m to $7.5m – conservative and nobody believed it, however in this market, justifiable and prudent.

We do admit when we don’t get it right, but three weeks ago we had pricing at $8.7m to $9.2m in a multiple bidder situation and $8.2m to $8.7m at a quieter auction. However, this is not about quoting – a good agent needs to be prudent. It was on the market with the opening bid – the quote was correct (for the seller).

A declined offer lifted the top end of the quote to $7.7m in the last week.

The campaign – which was an EOI due to close on Monday, turned into a private auction (we respect that so no pictures) held at 4 Fairview today (Saturday) @ 3.30pm, under ringmaster Mark Wridgway from RT Edgar.

Off the bat, Mark has played this campaign to a treat. Yes, he did have a brilliant product to sell however, he did do it well.

The pre-auction shenanigans and the auction itself was a masterclass in manipulation, momentum and marvel whilst for the 8 other “almost” buyers, it was a time of terror, tragedy and torture.

Opening bid from the inimitable Mr Morrell at $7.9m and we were on the market and away. Mainly $25,000 rises between there and $9m with a sprinkle of lesser ones, until a final knockout bid from $8.91m to the winning $9m. Congrats to the buyer and commiserations to the 5 bidders and the 3 “other buyers” who didn’t make it out of the agent quote range, prior to final private auction invitation acceptances.

Every time you hear all “the market is dead and buried” you are not hearing clearly or you are listening to the wrong people. It’s some, maybe a lot, but it’s far from all.

Overall, the market has eased  – this is agent code for not rising.

Statistically, the market is now as flat as a pancake (that is the Uluru blanket statement) BUT Melbourne is made up of many markets which are as wide and “vagarific” as The Great Barrier Reef. This is what makes it so exciting.

In a nutshell and why your professional advice and strategy needs to be spot on;

  • The A-Grade market continues to rise in the lower and upper end of the prestige market if you have a home of 3P quality – meaning;  quality property, quality position and quality (realistic) quote and reserve.
  • An Auction still has some very powerful dynamics – but those dynamics are only accentuated when you combine a property with the above 3P’s and a skilled operator driving the bus (agent).
  • However, if you miss the mark, the penalties for either the buyer or seller are substantial. If one of the 3P’s is off in this 2018 interval, then the home is not as easy to sell or you as a buyer can be seriously overpaying ($500,000 on a $4m home is very possible).

Volcanoes

Welcome ladies and gentleman to the totally volcanic Mr John Chartres. Take it away Johnny.......... 4 Bidders, 2 Beaconsfield Hawthorn East, $3,600,000.

Welcome ladies and gentlemen to the totally volcanic Mr John Chartres. Take it away Johnny………. 4 Bidders, 2 Beaconsfield Road, Hawthorn East, $3,600,000. Bang!

Hawthorn East, 2 Beaconsfield Road (John Chartres, Thomson) under the hammer, $3,600,000, 4 bidders

Albert Park, 9 Barrett Street (Greg Hocking, Greg Hocking) under the hammer, $2,560,000, 4 bidders

Hawthorn East, 48 Roseberry Street (Andrew Gibbons, ) under the hammer, $1,885,000, 4 bidders

Read all 35 reports here

Stonnington

In the shadows and after auction - Andrew Hayne and Maddie Kennedy sell 2 Fawkner South Yarra for a smidgen under $2million -2 bidders

In the shadows and after auction – Andrew Hayne and Maddie Kennedy sell 2 Fawkner, South Yarra for a smidgen under $2 million -2 bidders.

, 19a Valentine Grove (, Marshall White) under the hammer, $3,052,000, 3 bidders

Glen Iris, 21 Aintree Road (Andrew Macmillan, ) under the hammer, $2,850,000, 3 bidders

Kooyong, 23 Avenel Road (Andrew Hayne, Marshall White) under the hammer, $2,630,000, 3 bidders

Read all 35 reports here

Bayside

C'mon on where are, stop hiding. I know there are bidders here in Brighton - just been hard to find in 2018. Oh there you both are -

C’mon where are you, stop hiding. I know there are bidders here in Brighton – just been hard to find in 2018. Oh there you both are. 6 Bagley Brighton, David Hart, after auction $4,220,000 – 2 Bidders.

Brighton, 6 Bagley Street (David Hart, Buxton) after auction, $4,220,000, 2 bidders

Brighton, 2a Leslie Grove (Stephen Smith, Marshall White) under the hammer, $3,021,000, 2 bidders

, 10a Deakin Street (Danielle Martin) under the hammer, $2,310,000, 3 bidders

Read all 35 reports here

InnerEast

Kew, 1 Finhaven Court (, Kay & Burton) under the hammer, $3,050,000, 3 bidders

, 20 Kerr Crescent (Tim Heavyside, Fletchers) after auction, $2,410,000, 3 bidders

Hawthorn, 22 Linda Crescent ( Michael Wood, Marshall White) after auction, undisclosed, 2 bidders

Read all 35 reports here

BigDucks

And they say Marcus Chiminello is not a bleeding heart.

And they say Marcus Chiminello is not a bleeding heart, emotional kind of guy. We’re almost tearing up!

Albert Park, 58 Draper Street, after auction, $2,030,000, 1 bidder

Kew, 10 Argyle Road, passed in, $3,000,000, 0 bidders

Malvern, 37 Claremont Avenue, passed in, $3,500,000, 0 bidders

Read all 35 reports here

next week 100 auction

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