CAMBERWELL, 8 Kingsley St: Scott Patterson (Jellis Craig) was all smiles. Bought under the hammer, $2,375,000, 3 bidders

Key Points:

• Clearance Rates are definitely not as good as we are used to in Boroondara but they are still healthy in the mid 60′s and nearly 40 homes over a million were bought this week
• Stock Surge – Large amounts of $M+ stock are hitting the market for pre Easter campaigns
• 61 Bellett Camberwell has been on the market since July of last year and was sold by Sam Wilkinson of Kay and Burton mid week for $3,100,000.
• The Balwyn formula of big block, new home, big price tag seems to have come to a grinding halt – very few high end new sales. Opportunity?
• Off markets are on the increase.

Agent Q & A

How are stock levels and what will they be like leading up to Easter?

Glen Coutinho, Hocking Stuart, Kew: “There will be a surge in stock levels with a lot of homes being booked for auction just prior to Easter which is traditionally the end of a selling season and a new group starting after the break for winter.”

Duane Wolowiec, Marshall White, Hawthorn: “With limited weekends in April due to school holidays and Easter, there are a number of vendors working overtime to have their properties ready for sale with the view to auction either on the 2^nd or 9^th of April. Some vendors may feel a little rushed to meet the deadline and may opt for a longer lead up time and expose their property as a forthcoming auction.”

BRIGHTON, 7 Yuille St: Jonathan Dixon looks for bidders and finds one. Not enough to sell under the hammer though. Passed in $2,500,000, 1 bidder

Key Points:

• Two Land Sale Volcanoes 4+ bidder auctions below:
• 11 William St Brighton with Rod Richardson of Hocking Stuart – $3,100,000 for 1383 sqm of land = $2,241 per sqm for land in central Brighton. Solid and expected result. 5 bidders.
• 5 Horton Close Brighton with Campbell Cooney of Hodges – just off the north end of the Golden Mile. – $2,055,000 for 652 sqm of land = $3,151 per sqm land for smaller parcels closer to the beach. Solid. 5 bidders.
• People do want new homes in Bayside and this is backed up by the post auction sale with Peter Kennett at 1 Hunter St Black Rock – it is what we call the almost Balwyn formula (small land and big new home) – only its not quiet as big and lavish and has a more palatable $2m price tag instead of the $3m and $4m Boroondara price tags. Black Rock $2m versus North Balwyn $3.5m -  mmmmmm
• Further supporting evidence for new homes at the right price – 91 South Road Brighton with new home package specialist Justin Follett of Kay and Burton was bought on Tuesday through an Expressions of Interest campaign for in excess of $2,600,000.

Agent Q & A

How are stock levels and what will they be like leading up to Easter?

Robin Parker, RT Edgar, Brighton: “Stock levels for good quality family homes continue to be in short supply in the sub $2 million price bracket.”

Rod Richardson, Hocking Stuart, Brighton: “We definitely have a lot ahead of us.  I wouldn’t say stock levels have dropped at all and there is a lot more for sale in the coming weeks as we approach Easter.  The past few weeks we’ve had some good results and it looks like that’s set to continue.”

Hawthorn 35 Mason: Scott Patterson and Michael Armstrong: Bought for over $3,100,000: 4 bidders

Some interesting results to finish off the month:

• 6 Teringa Place Toorak with Andrew Macmillan and Andrew McCann of Benmac was bought Sunday for an undisclosed amount over $3,500,000. House was quite serviceable but it would have also been considered as a bulldozer job placing land just under $5000 per sq metre
• 

  49 Howe Crescent South Melbourne - bought in excess of $6,000,000. Expressions of Interest - Michael Coen Hocking Stuart

  And a very quick and smart result at 49 Howe Crescent South Melbourne with Michael Coen of Hocking Stuart – due to be sold through an Expressions of Interest Campaign completing 21st March it was snapped up within a few days of advertising on the 25th of February. The result was a strong one and is undisclosed but the  quoting was over $5,000,000 and we believe in sold for in excess of $6,000,000 to give you some perspective. We do a fair bit of work in the is Expression of Interest area and this again proves that those who wait until the stated deadline do not put themselves in the best position to buy.

• 

  290 Beach Beaumaris - Len Sharp Chisholm and Gamon - Full asking price of $2,950,000 after a previously failed selling campaign.

  Private Sale at 290 Beach Road Black Rock with Len Sharp of Chisholm and Gamon for full asking price of $2,950,000. This again supports our comments that 1) Bayside and 2) New and 3) $3m (almost) price tag are a combination that is getting some runs on the board in the late Summer of 2011.

• Caulfield 20 Langdon Road – Rochelle Butt and Rodney Morley of TBM got away 1500 sqm of land plus home in Caulfield North for an amount believed to be in excess of $4,000,000. Showing that Caulfield’s prices can be Canterbury prices when the right package is sought after.

Week Ending February 26th: If last week was the season opener for the $1m+ auction market, then  this  week  was the beginning of the $3m+ auction market and the main  focus for this weekend’s report. We don’t have all this weekend’s numbers in yet, so it’s hard to call, but it seems that this upper  market cleared at 44% of the properties under the hammer. We at  James accept a slightly lower auction clearance rate on the day in this segment as indicating balanced, warm or even hot  markets, because the air is generally thinner at this level due to the lower number of bidders available at this price point, and because the pre and post auction argy-bargy is  generally greater. Today there were quite a few $3m+ homes on offer. We  think this market segment is underwhelming at present – however if it is the right price, the right property and the right position it is still being well  received and taken up.

A few of the biggies that were bought

• Armadale 23 Wattletree Road – Justin Long – 3 bidders – $3,300,000
• Hawthorn 46 Illawarra – Mark Dayman – Bought Before – $4,250,000
• Brighton 33 Middle Crescent – Jason Swift – 3 bidders – $4,300,000
• Malvern East 8 Westgarth – Andrew Macmillan – 2 bidders – Post Auction Buy a smidge under $3,000,000
• Hawthorn 45 Mason – Scott Patterson – 4 bidders – Under  the Hammer over $3,100,000
• Malvern East 118 Finch – Bought for $3,150,000
• Kew 4 Madden – Peter Batrouney – Bought After – 1 bidder – $3,050,000
• East Melbourne – John Bongiorno – 3 bidders – $3,000,000

Some of the biggies that missed the mark

• Balwyn North 15 Stephens  – 2 bidders – Passed In for $3,650,000
• Balwyn North 59 Hosken – Passed In for $4,050,000
• Toorak 44 Verdant – Passed In for $3,750,000
• Hawthorn 23 Lisson – Passed In for $3,600,000
• Toorak 231 Kooyong – Passed In for $3,500,000
• Malvern East 50 Finch  - 1 Bidder – Passed In $4,100,000

St Kilda West 49 Mary: Passed In $4,000,000 - 0 Bidders: Andrew Stuart was not in the mood for mucking around – he had an uphill battle and he knew it. An opening vendor bid of $4,000,000 immediately hushed the vibrant crowd of 120 and that was it. Game over – a half time break for show but the gate was shut. A duck for this auction. Photos by Phoebe James

Week Ending February 19th: This market is either poor or, what is more reasonable to assume, still on holidays. Mike Gibson of Kay and Burton says that most high end sellers, as advised, are waiting. Hence the quality currently on the market is average. He expects good stock at this level to come on post Labour Day and before Easter.

To support our claims that the $3m+ market hasn’t really got going yet, look at this weekend’s Pass–Ins of $3m+ properties  –

St Kilda West – Mary St – $4,000,000 –  0 Bidders
James Auction Report: See Report Above

Camberwell – Canterbury Road – $3,801,000 – 1 Bidder
James Auction Report: An air of expectation at another James Tostevin Boroondara tennis court auction. He has almost singlehandedly made them his own over the last 2 years or thereabouts. His focus has been 20000 sq ft tennis court at $6m plus. A huge crowd, around 200 with kids trampolining, people milling and cars driving by. Everybody seems to know at least one person to give a wink or a nod to. Carnival atmosphere. Then the business started – well this time it didn’t. One auctioneer bid at $3,800,000 and then surprisingly one crowd bid for $1,000 more. Small Argument – settled with pass-in to the bidder on his $1,000 bid. Inside to do battle and last check they were still banging heads. We await the result.

"You are all very naughty schoolkids and I'm going to keep you back here somebody bids." Well no, James Tostevin didn't say that but he may have been thinking this on Saturday. Camberwell 31 Canterbury: Passed In $3,801,000: 1 bidder:

Balwyn – 12 Creswick – $3,425,000 – 3 Bidders
James Auction Report: A genuine bid of $2,000,000 opened proceedings. Auctioneer Maurice Di Marzio politely accepted the bid, suggesting it was closer to land value than a sale price, before offering a vendor bid of $3,200,000. More than 150 people watched Mr Di Marzio field bids from another two bidders before passing the property in at $3,425,000. Both interested parties headed inside after the auction for further discussions.

Albert Park – 139 Beaconsfield – $3,250,000 — 0 Bidders
James Auction Report: Auctioneer David Wood from Hocking Stuart was seriously up against the elements today as he tried to make himself heard against the traffic noise and the wind coming off Port Phillip Bay. The preamble was short and to the point, before he asked for bids. No one was prepared to open the bidding and he immediately entered a vendor bid of $3,250,000. Still no response, so half time was called. After the think music was up, the question was asked again and still no bids. The property was passed in on the vendor bid.

Gowan Stubbings of Kay and Burton successful at 29 Scott Grove Glen Iris

Kooyong – 711 Toorak – $3,190,000

In fact the only auction sale over $3,000,000 we covered was 29 Scott Grove Glen Iris (Gowan Stubbings of Kay and Burton) for $3,032,000 – 3 Bidders.
James Auction Report: A triangular battle developed right from the word go, and auctioneer Gowan Stubbings orchestrated the bidding superbly to maintain momentum throughout. Only when the $3,000,000 mark was eclipsed, did one of the bidders drop out. $32,000 later and the property was secured. Good naturedly, the two bidders shook hands to acknowledge the end of the contest. A riveting event.

However a few strong private and off-market sales show this market is not completely morbid. There is still some pulse. There were three very solid such sales in Bayside this week:

Brighton Golden Mile: Scene of 2 big sales over $10,000 per sq metre in February 2011

Shandford Avenue – Nick Johnstone of JP Dixon – $7.3m for 600sqm approx – which translates to $10,000 sqm for Golden Mile beachfront

Chatsworth Avenue – Stewart Lopez of Kay and Burton – $11m+ for 1100 sqm approx – again, $10,000 sqm for Golden Mile beachfront

Kerferd Road – Andrew Stuart of Hocking Stuart – $4.9m off market – 440 sqm approx

Continuing with February Sales:

While we have seen no sales over $3m reported in Boroondara and only the long suffering and difficult to see what you can do with it 13 Como Sth Yarra finally sold (Jeremy Fox of RT Edgar) we have seen a reasonable amount of mopping up action in Brighton – a sort of summer clean out.

New and old Brightonians like to buy New in Brighton

1 Inner Crescent Brighton with Justin Follett of Kay and Burton for an undisclosed amount – proved difficult to move and while it was an impressive residence it must have been price that proved the sticking point. Having said that line it up against a number of apartments and I thought the final result was fair value.

This type of offering sold well over Summer

2 William St Brighton – cnr St Andrews –scene of the all the helicopter noise in recent weeks saw a similar offering to 1 Inner Crescent also sell –reportedly through Kay and Burton.

2a Mulgoa also with Kay and Burton and a similar offering got a lot of it’s 50% better price basically because of its golden mile location.

Another good result  in the Golden Mile this time for the dynamic duo Regina Schmidt and Brian Devlin saw another of the Glyndon apartments (no 4) bought for $3,200,000 which continues to emphasize the demand for “retiree” offerings and it shows the selling appeal for Friedrich designs.

The Buxton duo again  – 1/188 The Esplanade with waterfront views but unlike the Golden Mile also some traffic noise – bought for $3,500,000.

And finally also Buxton in Brighton – David Hart got away a very popular 62 Dendy when we  went through it (but for us main road, south facing , tight block) for a smidge under $2,950,000. And increase of just over 28% from the depths of the GFC,  2 years ago.

BALWYN NORTH, 15 Stephens St: Big, big crowd of around 300 people enjoyed the sunshine and watched Doug McLauchlan (Marshall White) in action. Passed in $3,650,000, 2 bidders

At 6.00pm Saturday, the James Clearance Rate for the 31 Million Dollar Plus Auctions we covered was 74%.  The signs are there that the market has started with a hint of warmth about it. Bidderman was at 2, the $M+ Clearance Rate was 74% and this weekend’s Hammer rate was almost one in two. That’s a market moving past warm and into “hotting up” from a stats point of view. But the stock quality overall was high and you would expect to see an elevated clearance rate this weekend. However a lot of new stock has come on this week and the market may be in for a sustained period of potential Super Saturdays in March and April. This will really test whether the warmth we saw this weekend was an underlying hotting up or some temporary New Year afterglow. Overall our read on the current early opening $M+ market: Nicely Balanced.

New Stock:
With 202 new million dollar plus homes listed this week, March and April (the pre-Easter market) is looking like it will have a few potential Super Saturdays. And as we know, large numbers cool anything but the hottest of hot markets. So overall we are still calling the early 2011 market as we did last week: healthy, nicely balanced and starting as well as you could reasonably expect.

Bidderman:
Indicating the average bidders per auction, was at 2. Although that is up on last week statistically, to us it basically says steady as she goes. Last week had lower quality homes on offer (than average across the board), while this week was above average. Bidderman at 2 says “healthy market”. Please note though that if this were to be maintained in the pre-Easter market there would be upwards pressure on price. But with increasing stock levels coming on, significant upwards price pressure in this pre-Easter time seems less than likely. Did we say this early market seems balanced?

Crowds:
All agents have reported significant increases in human traffic through their OFIs (Open for Inspections) and on Saturday we reported six auctions with over 100 people in attendance. All auctions had good numbers watching.

Hammer Rate:
Almost one in two sold under the hammer – that is strong. Well done to vendors and buyers alike – this is what auctions are all about: selling and buying.

Ducks on the Pond:
Very few no-bidder auctions this weekend and they were mainly in that $3m+ segment.

Round the Grounds – $Million+ Snapshot from our Market Reports

Bayside – Overall Clearance Rate solid for Brighton – 77%

Stonnington – Nearly everything sold in Malvern and Malvern East, but what happened in South Yarra?

Boroondara – Big crowds but there is an underlying agent nervousness in Boroondara

Port Phillip – Lacklustre on what we saw – but still at 60% Clearance Rate

Rest of Melbourne – The fringe $1 million plus market is small but active

$3m+ properties:
If last week was the season opener for the $1m+ auction market, then this week was the beginning of the $3m+ auction market and the main focus for this weekend’s report. We don’t have all this weekend’s numbers in yet, so it’s hard to call, but it seems that this upper market cleared at 44% of the properties under the hammer. We at James accept a slightly lower auction clearance rate on the day in this segment as indicating balanced, warm or even hot markets, because the air is generally thinner at this level due to the lower number of bidders available at this price point, and the pre and post auction argy-bargy is generally greater. Today there were quite a few $3m+ homes on offer. We think this market segment is underwhelming at present – however with the right price, the right property, and the right position, it is still being well received and taken up.

A few of the biggies that were bought

• Armadale 23 Wattletree Road – Justin Long – 3 bidders – $3,300,000
• Hawthorn 46 Illawarra – Mark Dayman – Bought Before – $4,250,000
• Brighton 33 Middle Crescent – Jason Swift – 3 bidders – $4,300,000
• Malvern East 8 Westgarth – Andrew Macmillan – 2 bidders – Post Auction Buy a smidge under $3,000,000
• Hawthorn 45 Mason – Scott Patterson – 4 bidders – Under  the Hammer over $3,100,000
• Malvern East 118 Finch – Bought for $3,150,000
• Kew 4 Madden – Peter Batrouney – Bought After – 1 bidder
• East Melbourne – John Bongiorno – 3 bidders – $3,000,000

Some of the biggies that missed the mark

• Balwyn North 15 Stephens  – 2 bidders – Passed In for $3,650,000
• Balwyn North 59 Hosken – Passed In for $4,050,000
• Toorak 44 Verdant – Passed In for $3,750,000
• Hawthorn 23 Lisson – Passed In for $3,600,000
• Toorak 231 Kooyong – Passed In for $3,500,000
• Malvern East 50 Finch  - 1 Bidder – Passed In $4,100,000

More analysis on Bayside’s summer market can be found in our February $3m+ market report. New and old Brightonians like to buy New in Brighton- see the trend!

Are sellers missing out on Bidders and ultimately better prices because of Sargeants Conveyancing?
A number of  potential bidder’s lawyers will not allow their clients to bid on homes with unmodified Sargeants contracts. Yes this company provides cheap contracts but with completely unacceptable additional Special Condition clauses which buyers cannot agree to. Sargeants is putting not only potential buyers but their vendors into difficult positions. Sargeants are stripping away buyers’ already very limited basic property rights – but that is not good for the sellers either when buyers don’t bid. We do not bid on homes that have unmodified Sargeants contracts – not because we are on some moral crusade (hey we are buyer agents) but because our clients’ solicitors won’t let us. Sellers, our clients money is good money, this weekend we bought 4 from 4 at auction over a million dollars – maybe we didn’t bid on yours because you had an unmodified Sargeants contract.

"Rebel With a Cause" Jason Swift in Action at 33 Middle Crescent Brighton - see below

Biggest Sale: 33 Middle Crescent, Brighton, Jason Swift (Hodges); Bought under the hammer, $4,300,000, 3 bidders
“Hey start me where you like – somebody bounce my ball” cried out the cockney accent of Jason Swift. I loved this auction; it was entertaining , bold and good ‘ol fashion fun. Jason Swift gave us piles of corn, humour, clichés and he gave the auction something else – character and the more important – momentum . At first you might think, hmmm bit strange – bloody Pom doing an auction – but mate he’s as Aussie as Jack Thompson and I loved the way he auctioned this home. The crowd was spread out – the vendor wanted a big but not ridiculous number and with good work pre-auction and a classy performance on the day, Hodges got what their client wanted. Well done Jason; I’m not sure how many people know just how good that was – bringing a crowd with you at this level is what only a few can do well. That was definitely a 2 hat performance. Opened at $3,000,000; on market at $4,200,000 concluding under the hammer at $4,300,000. Great theatre and a great way to finish the day.”

Biggest Pass In: 50 Finch St, Malvern East, John Bongiorno (Marshall White); Passed in $4,100,000, 1 bidder
“What a turnout for this auction! It looked like the whole neighbourhood had turned up, with a crowd of 200 watching auctioneer John Bongiorno in action. However, despite the buzz and the anticipation from the crowd, you could really tell that most of them were there just to sightsee as when the time came for an opening bid all was quiet. An opening vendor bid of $4,000,000 never really got things going, while a late bid from one member of the crowd was all the action that was seen and with that the property was passed in. A lot of people stayed though, either to catch up with each other or to see whether the lone bidder was successful in post-auction negotiations.”

Bidderbuzz Auction: 35 Mason St, Hawthorn, Scott Patterson (Jellis Craig); under the hammer, in excess of $3,100,000. 4 bidders
“A big crowd of around 125 gathered for this Jellis Craig/Kay and Burton auction with Scott Patterson and Michael Armstrong managing proceedings. You could feel there were a lot of bidders ready to go and after a perfectly timed intro form Scott Patterson we were away with a $2,750,000 opening bid. On the market at $3,100,000 and bought under the hammer for an undisclosed price in excess of that. A strong auction and numerous other disappointed bidders didn’t get a look in. This is a good home and so the market is saying good properties will be well supported.”

What the key agents said about the current market:
Geoff Hall, Noel Jones, Camberwell: “Motivated vendors are good right now – we are listing well but buyers seem a little thin on the ground. We think right now there is one buyer for every home and on some homes when we find that buyer we are trying our hardest to put it away. I think last week the market started in balance.”

Tim Heavyside of Fletchers: “Most homes are selling on the day or shortly afterwards – a number are not flying – but they are selling. A lot of stock is about to hit the market in April, after sellers became a bit nervous about entering the market late last year and held their sale up. Now a number of them have decided to sell and consequently we are seeing a stock build up.”

Campbell Cooney of Hodges: “Things firmed up in the market just before Xmas with some difficult homes having price adjustments and selling.  Since January we have had double our normal numbers through OFIs, for instance a normal home where we were having 7 or 8 groups through in November is now having 15 groups through at each inspection.

Both Scott Patterson of Jellis Craig and John Bongiorno of Marshall White reported 70% approx. clearance rates on largish auction stock numbers. Both agree the market is certainly not hot – but it’s not weak either, except possibly at the higher end.

Auction Video: This week we head to sunny Brighton, where we watch Nick Johnstone in action at 2 Maher St. Click on the live action. Apologies – we are in the middle of creating a three video connection each week: Big Issue – Auction Video – Sunday Reflections. There may be some technical difficulties while we put this new automated system in over the next week.

Please Note: we always ask permission to film and we always show respect at each auction. We also never video at an auction we are bidding at. If you are at an auction and don’t wish to be videoed, there are designated no-video zones. See our co-workers or ask the auctioneer.

Buyer Masterclass: We thought a bit of poetry was in order and while we couldn’t contact Banjo we got his relative Cal Bung to pen us some words.

We Only Buy Homes

Hawthorn 35 Mason: Scott Patterson and Michael Armstrong: Bought for over $3,100,000: 4 bidders

Week Ending February 26th: If last week was the season opener for the $1m+ auction market, then this week was the beginning of the $3m+ auction market and the main focus for this weekend’s report. We don’t have all this weekend’s numbers in yet, so it’s hard to call, but it seems that this upper market cleared at 44% of the properties under the hammer. We at James accept a slightly lower auction clearance rate on the day in this segment as indicating balanced, warm or even hot markets, because the air is generally thinner at this level due to the lower number of bidders available at this price point, and because the pre and post auction argy-bargy is generally greater. Today there were quite a few $3m+ homes on offer. We think this market segment is underwhelming at present – however if it is the right price, the right property and the right position it is still being well received and taken up.

A few of the biggies that were bought

• Armadale 23 Wattletree Road – Justin Long – 3 bidders – $3,300,000
• Hawthorn 46 Illawarra – Mark Dayman – Bought Before – $4,250,000
• Brighton 33 Middle Crescent – Jason Swift – 3 bidders – $4,300,000
• Malvern East 8 Westgarth – Andrew Macmillan – 2 bidders – Post Auction Buy a smidge under $3,000,000
• Hawthorn 45 Mason – Scott Patterson – 4 bidders – Under  the Hammer over $3,100,000
• Malvern East 118 Finch – Bought for $3,150,000
• Kew 4 Madden – Peter Batrouney – Bought After – 1 bidder – $3,050,000
• East Melbourne – John Bongiorno – 3 bidders – $3,000,000

Some of the biggies that missed the mark

• Balwyn North 15 Stephens  – 2 bidders – Passed In for $3,650,000
• Balwyn North 59 Hosken – Passed In for $4,050,000
• Toorak 44 Verdant – Passed In for $3,750,000
• Hawthorn 23 Lisson – Passed In for $3,600,000
• Toorak 231 Kooyong – Passed In for $3,500,000
• Malvern East 50 Finch  - 1 Bidder – Passed In $4,100,000

St Kilda West 49 Mary: Passed In $4,000,000 - 0 Bidders: Andrew Stuart was not in the mood for mucking around – he had an uphill battle and he knew it. An opening vendor bid of $4,000,000 immediately hushed the vibrant crowd of 120 and that was it. Game over – a half time break for show but the gate was shut. A duck for this auction. Photos by Phoebe James

Week Ending February 19th: This market is either poor or, what is more reasonable to assume, still on holidays. Mike Gibson of Kay and Burton says that most high end sellers, as advised, are waiting. Hence the quality currently on the market is average. He expects good stock at this level to come on post Labour Day and before Easter.

To support our claims that the $3m+ market hasn’t really got going yet, look at this weekend’s Pass–Ins of $3m+ properties  –

St Kilda West – Mary St – $4,000,000 –  0 Bidders
James Auction Report: See Report Above

Camberwell – Canterbury Road – $3,801,000 – 1 Bidder
James Auction Report: An air of expectation at another James Tostevin Boroondara tennis court auction. He has almost singlehandedly made them his own over the last 2 years or thereabouts. His focus has been 20000 sq ft tennis court at $6m plus. A huge crowd, around 200 with kids trampolining, people milling and cars driving by. Everybody seems to know at least one person to give a wink or a nod to. Carnival atmosphere. Then the business started – well this time it didn’t. One auctioneer bid at $3,800,000 and then surprisingly one crowd bid for $1,000 more. Small Argument – settled with pass-in to the bidder on his $1,000 bid. Inside to do battle and last check they were still banging heads. We await the result.

"You are all very naughty schoolkids and I'm going to keep you back here somebody bids." Well no, James Tostevin didn't say that but he may have been thinking this on Saturday. Camberwell 31 Canterbury: Passed In $3,801,000: 1 bidder:

Balwyn – 12 Creswick – $3,425,000 – 3 Bidders
James Auction Report: A genuine bid of $2,000,000 opened proceedings. Auctioneer Maurice Di Marzio politely accepted the bid, suggesting it was closer to land value than a sale price, before offering a vendor bid of $3,200,000. More than 150 people watched Mr Di Marzio field bids from another two bidders before passing the property in at $3,425,000. Both interested parties headed inside after the auction for further discussions.

Albert Park – 139 Beaconsfield – $3,250,000 — 0 Bidders
James Auction Report: Auctioneer David Wood from Hocking Stuart was seriously up against the elements today as he tried to make himself heard against the traffic noise and the wind coming off Port Phillip Bay. The preamble was short and to the point, before he asked for bids. No one was prepared to open the bidding and he immediately entered a vendor bid of $3,250,000. Still no response, so half time was called. After the think music was up, the question was asked again and still no bids. The property was passed in on the vendor bid.

Gowan Stubbings of Kay and Burton successful at 29 Scott Grove Glen Iris

Kooyong – 711 Toorak – $3,190,000

In fact the only auction sale over $3,000,000 we covered was 29 Scott Grove Glen Iris (Gowan Stubbings of Kay and Burton) for $3,032,000 – 3 Bidders.
James Auction Report: A triangular battle developed right from the word go, and auctioneer Gowan Stubbings orchestrated the bidding superbly to maintain momentum throughout. Only when the $3,000,000 mark was eclipsed, did one of the bidders drop out. $32,000 later and the property was secured. Good naturedly, the two bidders shook hands to acknowledge the end of the contest. A riveting event.

However a few strong private and off-market sales show this market is not completely morbid. There is still some pulse. There were three very solid such sales in Bayside this week:

Brighton Golden Mile: Scene of 2 big sales over $10,000 per sq metre in February 2011

Shandford Avenue – Nick Johnstone of JP Dixon – $7.3m for 600sqm approx – which translates to $10,000 sqm for Golden Mile beachfront

Chatsworth Avenue – Stewart Lopez of Kay and Burton – $11m+ for 1100 sqm approx – again, $10,000 sqm for Golden Mile beachfront

Kerferd Road – Andrew Stuart of Hocking Stuart – $4.9m off market – 440 sqm approx

Continuing with February Sales:

While we have seen no sales over $3m reported in Boroondara and only the long suffering and difficult to see what you can do with it 13 Como Sth Yarra finally sold (Jeremy Fox of RT Edgar) we have seen a reasonable amount of mopping up action in Brighton – a sort of summer clean out.

New and old Brightonians like to buy New in Brighton

1 Inner Crescent Brighton with Justin Follett of Kay and Burton for an undisclosed amount – proved difficult to move and while it was an impressive residence it must have been price that proved the sticking point. Having said that line it up against a number of apartments and I thought the final result was fair value.

This type of offering sold well over Summer

2 William St Brighton – cnr St Andrews –scene of the all the helicopter noise in recent weeks saw a similar offering to 1 Inner Crescent also sell –reportedly through Kay and Burton.

2a Mulgoa also with Kay and Burton and a similar offering got a lot of it’s 50% better price basically because of its golden mile location.

Another good result  in the Golden Mile this time for the dynamic duo Regina Schmidt and Brian Devlin saw another of the Glyndon apartments (no 4) bought for $3,200,000 which continues to emphasize the demand for “retiree” offerings and it shows the selling appeal for Friedrich designs.

The Buxton duo again  – 1/188 The Esplanade with waterfront views but unlike the Golden Mile also some traffic noise – bought for $3,500,000.

And finally also Buxton in Brighton – David Hart got away a very popular 62 Dendy when we  went through it (but for us main road, south facing , tight block) for a smidge under $2,950,000. And increase of just over 28% from the depths of the GFC,  2 years ago.

Will we see last year's crowd numbers return for the opening of the 2011 auction season this weekend? Find out at marketnews.com.au on February 19th at 6pm.

Welcome to Million Dollar Melbourne in 2011

With the Auction Season Opener hitting us between the eyes on February 19, we know that the big question for buyers, sellers and agents is: What is going to happen in 2011?

The feeling in late 2010 was that the market was cooling and we shared that view on price – but we did not share that view on activity. The December market finished quite strongly activity wise.

What’s been happening so far in 2011?

During the last week in Jan, I personally went to 10 homes over $1million in Boroondara (Kew, Hawthorn, Balwyn, Canterbury etc). I was a little surprised at the solid numbers of people inspecting at all opens.

This past weekend (the first full one in February) I focused on Bayside, mainly Brighton, and it was very quiet, very different – with very few people.  The exceptions were 62 Dendy St (David Hart) – a new home on a busy street; a big home at 33 Middle Crescent (Campbell Cooney) and a great little home at 26 Moffat  (David Wilson). Why this last one hasn’t flown out the door yet I don’t know – we gave it a rating over 800. The other seven opens were poorly attended.

Flooding may have been one reason for the reduced activity in Bayside – this was only a few hours after that incredible rain. There were a number of cancelled opens due to inundation (a word we are hearing all too often at the moment) of garages.

Even so there is still plenty happening at Bayside’s Top End. 33 Chatsworth Brighton with 1300 sqm of absolute beachfront has just sold (with Stewart Lopez and Ian Jackson of Kay and Burton) for an undisclosed sum (we reckon around $12 million). And another property on the Golden Mile beachfront at Shandford Ave, with about 600 sqm, reportedly sold for north of $7 million with Nick Johnstone of JP Dixon. So  Bayside Top End is not exactly dead yet.

Next week we have a full book of inspections at quality homes on and off market in Stonnington. Look out for our reports.

So back to the season opener on February 19. This will be the first real public test of the auction market. What sort of stock numbers are out there at the moment?

Last year we used 100 auctions as the definition of a big Saturday. We had four of them in a row at the end of the year, after a very slow start to Spring caused by the election and then the election result uncertainty.

This February 19 sees 74 auctions scheduled – a solid start without setting the world on fire. It is February 26 that provides us with our first real 2011 benchmark with over 120 homes under the hammer. We think that weekend will be the first of about a dozen benchmark auction days we will have through 2011..

So what are the results we are looking at and what will they mean?

Bidderman, our bidders per auction indicator, is an important guide of demand. With Bidderman dropping to around 1 late last year we saw prices drop. A similar number on the first Super Saturday will not be a good sign for sellers especially because there is good stock quality on both auction days (hence no excuses), so a low Bidderman will indicate a genuine lack of interest. If that were to continue we would definitely see a drop in prices. Of course it will be a different result if Bidderman averages more than 2 bidders per auction.

The other important measure is clearance rates. These strengthened towards the end of last year –  not because buyers went berserk but because sellers were forced to meet the diminished market conditions. We had a “strongish” late market because of seller flexibility.

What will the clearance rate numbers mean? If the clearance rates at for these two auction Saturdays are in the 50% range we would consider the market to be soft, marking the beginning of a buyers’ market. If clearance rates are between 60 and 70% for both weekends then it’s fairly balanced. If the clearance rate is around or more than70% then the market noise would be strong and, depending on stock levels going forward, prices may move upwards.

CAV slackens off on Conflict Of Interest issue

One item of news that has snuck under the radar is Consumer Affairs slackening off of the old Section 55 of the Estate Agents Act. This set out a rigorous process in cases where agents want to buy vendors’ homes that are being handled by their own agency, for instance where a Hocking Stuart agent is buying a Hocking Stuart advertised property. Consumer Affairs has severely diluted the strength of the legislation by saying it no longer requires an independent valuation and that an unqualified representative can sign off like a lawyer or an accountant.

This dilution is dangerous and is being driven by either ignorance or laziness on the part of CAV. Selling agents are not asking for it; in fact many ethical agents abhor CAV actions in this matter. We all need checks and balances.

The Consumer watchdog has abrogated its responsibilities, leaving vulnerable old ladies and others to be taken for a ride.

We don’t think agents should be allowed to buy a property handled by the agency they work for at all – there is just too much conflict of interest. But if the law and CAV allows this to continue there MUST be rigorous checks and balances in place to protect the vulnerable.

Imagine if the police weakened their stance on fraud because they wanted to streamline their paperwork. This is not good enough CAV.

On a lighter note, over this year 2011 we will be bringing you even more information, more sold results, more stats, and more detailed analysis.

We will also be back to the job we love most – buying great properties for our clients. After one week back, we’ve already made our first client home purchase for a property in Thomas St Hampton. After six weeks away with the kids  - we need to get our sanity back. So bring on those auctions.

Buy Well.

Balwyn 12 Knutsford, The old boy's in a good mood - it must be selling. Tim Derham and the effervescent Lisa Jarrett of Abercrombys. Bought under the hammer for $3,520,000. 4 bidders.

Today’s Highlights:

• Balwyn 32 Stephens, Maurice Di Marzio, Bought under the hammer for $3,800,000 – 4 bidders
• Balwyn 12 Knutsford, Tim Derham, Bought under the hammer for $3,520,000 – 4 bidders
• Kew 1 Stawell, Gowan Stubbings, undisclosed Bought after – 2 bidders
• Kew 3-5 Rimington, Scott Patterson, Bought After above $3,650,000 -  2 bidders

Off Market

• Hawthorn 26 Fordholm, Michael Armstrong, Over $5,000,000

Not so Highlights:

• Canterbury 34 Maling, passed in $4,600,000

Agent Q & A: If you were a buyer, how would you buy a house over the next two months, during the Christmas break?
Mark Dayman, Marshall White, Hawthorn: “We acknowledge that the property numbers in The Age and the local paper are reducing each week leading up to Christmas. Subsequently  a number of buyers that have sold first or recently come in from overseas/interstate are still actively looking preferring to buy now and to be settled prior to schools returning in early 2011. Buyers should register their details with an agent or agency they know will be working through the Christmas New Year break. Already most agencies have forward bookings now for February-March and willing vendors receptive to negotiating prior to auction and effecting a sale with the highest possible price shortest possible time frame least amount of stress. Bear in mind that owing to the Spring volume a few good properties have slipped through the cracks and these opportunities should again be pursued.”

Valuing land is difficult enough, but there are even more variables when it comes to getting a consistent opinion of the market value of an actual building.

We always counsel long term passive investors to buy purely on land value, or to buy proven populist homes like Victorians and Edwardians as opposed to new homes.  Why?

Buildings are very much like clothes: they are fashion statements and, as such, various styles go in and out of fashion. Many of us love period homes now, but in the 1960s the thinking was to modernise them and in the process a number of classic buildings were destroyed. Similarly, Art Deco was loved in the 1920s and 30s but now has a limited following  – a very passionate one who will pay strong prices, but limited nonetheless.

The value of a home depreciates just as a new car does the moment it is driven from the showroom.  If half your money is spent on the home (the other half on the land) and that home goes out of favour as many do (such as the recent fad to Georgian reproduction homes), then while the land component may be growing in value, the other half of your money is working in a negative direction growth-wise.

To demonstrate the various ways different people can regard the same building, here are the opinions of four famous agents on the value of a 25 square 1970s home, with an ensuite and double garage, on a nice block in Inner Melbourne.

Ms Artina Deco: $400,000. “I think this home will be bought by an overseas buyer who would consider this a good solid home.”

Sir Eddy Wardian: $300,000. “I think this home will be bought by a new home buyer and renovated to new. My estimate of its value when renovated is $700,000 and I think it will cost $400,000 to renovate – therefore it is worth $300,000.”

Mr Victor Rian: $200,000. “I think this home will be bought by an investor who will get a 3% rental return so I have based my calculation on that.”

Cal Bung: Zippo – $0. “I think this home will be bought by a developer who will bulldoze and put up units.”

As for me – my opinion of the market value of this home would depend on where it is located. If it was Balwyn I’d say $300,000 to $400,000, because that’s how overseas buyers from China and India have been assessing similar homes recently.

But if I was in Brighton or Toorak, I’d say between zero and $200,000 because it is more likely to be bulldozed and the site developed. Many great homes in Toorak have no value because they are bulldozed by a new owner with plenty of funds who want to make their own footprint.

While there are no set in stone rules in building value assessment – here are a few guidelines that we follow

1.       New homes we calculate at replacement value

2.       Near new homes we calculate at replacement value minus a cosmetic update cost

3.       Homes 20 to 50 years old depend on the suburb. A way of getting a handle on values on these buildings is to build a database of comparable (similar) sales, subtract what you consider to be land values, and build a range of how the market values homes.

4.       1940s to 1970s homes without architectural merit – zero. With merit – difficult!

5.       Pre 1940s period homes that need to be completely gutted – a token amount depending on size

6.       Pre 1940s period homes that need some work – completed value less estimated renovation value

7.       Pre 1940s period homes completely renovated – compare to others in area and if that is not easy we value at replacement cost as if it were a similar quality and sized new home.

Valuing homes and land and emotion is the pursuit of perfection by the imperfect – but the closer you get, the better your decisions and strategies can be.

Printed each week in The Weekly Review – Melbourne’s Million Dollar Plus Magazine

Balwyn, 17 May St, Maurice Di Marzio (Hocking Stuart); Bought after auction, $1,598,000, 1 bidder.

Key Points: Boroondara’s clearance rate of 72% on 42 $1-million-plus reported auctions remains solid. Only 2 properties sold under the hammer of the 9 auctions we monitored, with the other sales being before (2) and after (3). Auction levels still on the increase in the coming weeks.

Flying high: Richard Earle (Jellis Craig) and team secure a great result at 27 Grange Rd, Kew. Bought after auction $2,885,000: 2 bidders and crowd of 90

Key points:

• We attended nine auctions in Boroondara. Four were bought under the hammer, three were bought after and two remain unsold
• 13 Kirkwood Drive, Camberwell (Steven Abbott, Jellis Craig) had six bidders, while 5 Vaughan Ave, Canterbury (Tim Heavyside, Fletchers, bought for $1,901,500) had five.
• Biggest sale of the day was 27 Grange Rd, Kew (Richard Earle, Jellis Craig), bought after for $2,885,000 (see report below)

Biggest sale: 27 Grange Rd, Kew, Richard Earle, Jellis Craig, bought after auction, $2,885,000, 2 bidders
“The professional Richard Earle got two more starters on this than I thought he may. Because while it is very quaint, it has the “$3 million handbrake” of small bedrooms. Opening vendor bid at $2,700,000. The first bidder opened at $2,750,000, the second at $2,800,000 and proceedings limped along until a temporary halt was called and the property was passed-in to Bidder 1 at $2,875,000. $10,000 was popped on top afterwards to make the deal sweet enough for the top bidder and the owner to sign on the dotted line. I think the boys at Jellis Craig did well to get this one away at the price they did.” (Mal James)

BidderBuzz Auction of the Day: 13 Kirkwood, Drive, Camberwell, Steven Abbott, Jellis Craig, Under the Hammer, $1,485,000, 6 bidders
“Driving into Kirkwood Ave, there was a hint that the auction would be a cracker as the street was filled with cars. The buzz of anticipation was felt as the crowd was ushered into the family room and onto the decking outside to watch auctioneer Steven Abbott open proceedings. The auction started off in typical fashion with the crowd a little shy in opening the bidding. It needed a jump start from Mr Abbott, who put in a vendor bid of $1,250,000. Immediately the crowd came to life with bids coming in left, right and centre and the price quickly pushed up to $1,440,000 at which point the home was declared on the market. A tug of war ensued between two bidders who slowly pushed the price up further – and the auction ended with a knock-out bid of $1,485,000.” (Joshua Bong)

This week’s private and off market sales $3m+

• Canterbury, 37 Alexandra Ave, David Wu, Paragon, undisclosed
• Balwyn North, 28 Hosken, Geordie Dixon of Marshall White over $3,300,000 – finally got inked.
• Canterbury 42 Parlington, Sam Wilkinson of Kay and Burton was bought in a private sale for more than $3,000,000

Price Check – Remarkably similar land prices yesterday

Agent Q & A:

What advice would you give a buyer wanting to purchase a property between now and Melbourne Cup Weekend?
Tim Heavyside, Fletchers, Canterbury:“We are approaching some of the busiest weekend periods and availability to buy before the end of the calendar year. My advice to buyers over this time is; if you are ready to buy and you see the right home, go for it!  We are now listing homes for  for the auction date of 7 November. This means we only have three ‘fair dinkum’ weeks left to list and finalise our stock to market before the end of this calendar year. If a property is 7/10 or 8/10 – buy it.  10/10 homes are generally out of your price range.”
David Gillham, Noel Jones, Camberwell:“Buyers have been holding back recently which has put vendors ill at ease. My advice is for them to get on the front foot and make offers before auction as most vendors are willing to negotiate prior if the offers are reasonable.”
Jeremy Tyrrell, Fletchers, Balwyn North:”Buyers seem to be sitting on their hands somewhat and I think the next few weeks leading up to the Melbourne Cup will present some very good buying opportunities. Don’t wait is my advice – Spring has sprung and the amount of properties on the market has significantly increased.”
Glen Coutinho, Hocking Stuart, Hawthorn/Camberwell:”Between now and Cup Weekend is the busiest time and a great chance for buyers to secure a home as stock levels are high, so take advantage of it while you can.”
Andrew  Gibbons, Marshall White, Hawthorn:”If you are going to the races, we can still bid on your behalf. Also, if there is a house you like in your price range, in your budget – go for it. Why not? Don’t put things on hold. It’s always very disheartening to miss out and then see in the papers the next day that the house you were interested in sold within your price range. There is also nothing stopping you from buying before auction. Try to put in that knockout bid, put your best foot forward.”
Alastair Craig, Jellis Craig, Hawthorn:”Should you find a property of interest to you right now, you should buy it! It is often difficult to find a property that fulfils 100% of your criteria. In my opinion if you find a property at any time that ticks the majority of the boxes then you should secure it regardless of the timing. Real estate is a long term investment and therefore in the short term you cannot pay too much for a property, but if you buy a property and then seek to re sell it within a short time frame then unless the market is booming, you will make a loss.”

Not Happy James: 3 Scott Hawthorn: Passed In for $1,260,000. 1 bidder.

Key Points

• Clearance rate lower than expected
• 4 out of 5 properties over $2,000,000 passed in
• A number of no bid auctions which we haven’t seen for some time in Boroondara
• 6 out of 7 properties in Balwyn North between $1,000,000 and $1,500,000 were bought

Price Watch

• 10 Leslie St Hawthorn with Chloe Quinn of Jellis Craig was bought for at $1,310,000, around 20% more than was paid last year
• 11 Carlyle St Hawthorn East with Tim Heavyside of Fletchers is bought for just under $2,000,000 or $2,400 per sq metre in Harcourt precinct
• 15 Constance Hawthorn East with Tina Ceravolo of Hocking Stuart is bought for $2,451,000, or $3100 per sq metre if you bulldoze in Anderson Park precinct

Biggest

• 4 Willandra Canterbury was bought pre auction through Paul Pfeiffer of Hocking Stuart for around $3,000,000

BidderBuzz

15 Constance St, Hawthorn East, Glen Coutinho, Hocking Stuart, Under the Hammer $2,451,000, 5 bidders
“A superb spring day greeted the very large crowd that gathered at Constance Street, Hawthorn East. There was a high level of eagerness and once the auction began it was clear why. As Glen Coutinho initiated proceedings an immediate bid of $1,700,000 was placed. This was obviously below the vendor’s expectations, however Mr Coutinho accepted the bid and the auction began to take shape. With 5 keen participants there was a high level of activity – it did take sometime for the bidding to reach the reserve of $2,400,000. This auction was highly entertaining and the bidding was managed and delivered with enthusiasm and excitement. Mr Coutinho’s honesty from the outset of where the reserve price sat helped to deliver a favourable result for the vendors. With two potential buyers still in the race once the reserve was met, the property was finally bought under the hammer for $2,451,000.” (Dustin Cracknell)

Agent Q & A:

October 23 is Super Saturday – What can we expect?

James Tostevin, Marshall White, Hawthorn: “It has been a strange ‘lead-in’ to spring, given the drawn out election and uncertainty surrounding which political party was going to be in office, two AFL Grand Finals and of course, the school holidays. The weekends leading up to the 23rd have a reasonable offering of properties, but the weekend prior to the Melbourne Cup long weekend will provide a real test of the current strength of the real estate market. I am anticipating a clearance/success rate in the vicinity of 70% across Melbourne, possibly a little above that in the best performed suburbs within the Boroondara, Whitehorse, Stonnington and Bayside areas.”

Steve Burke, Jellis Craig, Hawthorn: “Super Saturday is a great test for our marketplace and I am sure the clearance rates will continue to be strong based on the energy from the buyers coming through the open houses.”

Forward Auction Bookings

Clearance Rates

Results

Some of our buyer prayers have been answered

Market: Even with significantly reduced auction numbers this weekend (owing to a more important event which finally delivered a result that proved there was justice in the world), we still saw a pretty healthy market result for sellers – with a 74% Clearance Rate on the 55 $Million+ auctions we monitored. Of those 55 auctions, 9 results were not reported. But even that is not unreasonable under the circumstances of the GF Replay.

There seems little doubt that the market is on the rise. The big interest now is how the market will absorb the stock surge that will culminate in Spring/Summer’s first Super Saturday on October 23rd.

And it really is Super Saturday - with a massive 81 $M+ auctions booked for Boroondara alone, and around 200 $M+ auctions booked in our key focus $M+ areas – Bayside and Inner East. Check out the size of the Weekly Review this week (it’s as big as a phone book). By comparison this weekend saw only one quarter of that number of auctions. So if you were at an auction this weekend, those four bidders you competed against may well be spread across four homes in a couple of weeks. Well that’s the “buyer-hope” theory anyway.

This Week’s Highlights:

• Two land sales showing vastly differing land values
  a) Land at 101 River Avenue Plenty (39,500 sqm), which can be subdivided, was auctioned  by Rob Stefanovski of LJ Hooker Greensborough and  bought for $3,830,000 or $96 per sq metre
  b) A large land parcel (1,813 sqm) at 3-5 Heath St Sandringham sold after a failed auction by Bill Jowett of Buxton for $2,800,000 or $1,544 per sq metre
• The major stock inflows that took place on Monday, Tuesday and Wednesday when agents began their marketing campaigns for the next Super Saturday – October 23rd.
• The continued improvement of the $3M+ market – two examples below
  a) Off market in Black St Brighton (Peter Bourbaud and Barb Gregory) – bought for around $4 million
  b) 27 Moorhouse Armadale with Gowan Stubbings of Kay and Burton – bought after an Expression of Interest campaign for more than $5 million
• The Pies Forward Line pressure (whoops, sorry – I got distracted)

Auction Snapshot from this weekend: 133 Rathmines Fairfield: Michael Fry and Grant Leonard of Nelson Alexander. Bought under the hammer for $1,116,000. 5 bidders.
There was a buzz about this well located timber period home, which had had its quote lifted to $930,000 during the campaign. It was a surprising development given Grant’s comment that the property failed to attract any interest in the high $800s a few months ago with a quiet sale campaign. It was on the market with the first bid at $900,000. Second bid $950,000. Third bid $970,000. Fourth bid-  bang $1,000,000. Three more bidders joined in before the action stopped at $1,116,000. It was a well run auction campaign. I always enjoy a Michael Fry auction. He has a sophisticated grace about him incongruent with the fact that he is yanking the dollars from buyers’ pockets. Enjoyable to watch unless you’re an underbidder – which unfortunately this time we were.

Bumper Market Insight: We have an information packed Market Insight this week; even though there are no Market Wraps, Bidderman, reports or videos.  The footy replay threw this auction weekend into a bit of chaos, with a few auctions even changing days. But it was a very low stock weekend anyway, so no major damage. All $M results are at the end of this Market Insight. But the big news now is the next three weekends that will lead full bore into the Melbourne Cup Long Weekend.

Stock Levels and Price Assessment:
The big question the market will be asking now is: What will happen to prices on October 23rd? With this big stock influx, how is the price game of snakes and ladders going to pan out? Are we going to see the slippery snake and big price slide of May 2010 or will the market just take this in its stride, as it did this time last year, with prices climbing further up the ladder? Time will tell. Importantly as buyers you need to get yourself organised – and don’t count your chickens before they’ve hatched.

With this apparent largess of choice, perhaps you don’t need brilliant home-seeking skills right at this moment. But you will need first class assessment procedures (e.g. sorting the goodies from the baddies in terms of capital growth prospects, and working out which one is best from a “happy wife = happy life” point of view). You will also need good negotiation strategies – because while you may have more choice, you will also have competition. Remember, our bidders per auction indicator Bidderman was strong on lower numbers in September, especially on good homes. On the flipside, some sellers expectations may be disappointed, so planning good negotiation strategies will improve your chances of grabbing a bargain when it presents.

Have a look at our Forward Auction Booking graphs below to get an idea of what is ahead of you: (click on a graph to enlarge)

There are also some exciting trophy homes on offer through private sale and off market – especially in the $3m+ segment.

Have a look at the New Stock Graph at the top of Market Insight – which compares the last week in September to the last week in June, (private sale and auction weekly new stock numbers are combined).

Special Report on the $3m Market

The $3m+ is back, after the self induced May hiccup that led to a very quiet winter.

There have been over 50 buys in the month of September at this level, with buyers coming from all quarters. Let’s pick one of the segments – around $4million. We have bought 3 homes at this specific level in the last few weeks. All were classic period homes with land of over 1000 square metres. Two were bought post auction (eg after a pass-in) and one was off market (Black St Brighton). However, the interesting thing were the buyer profiles. One buyer was a change of life family, one was a growing family that needed more space, and one was an expat family returning from overseas. This is a fairly accurate representation of the range of people we look for homes for. Of the last case – expats returning from overseas -Brighton high end agent Peter Bourbaud believes “this group will push the market along for the next few years, after a couple of very quiet years from the expat community”. We concur. Last year we conducted very little in business terms last year for expats. However in 2010 there has been a distinct pick up in action from expats returning home.

The James September $3m+ Report with all reported $3m+ boughts and solds can be viewed from the Home Page (next to Market Insight and below Buyer Masterclass) or click here

If you are new to the $3m market you may find the charts below (using 2007 to 2010 Valuer General, REIV and our own James Databases) of some value, as they help to show how the overall $3m+ market works. Note particularly that:

• The two powerhouse $3m+ suburbs are Brighton and Toorak (see 2009 results graphed below). However these two suburbs behave quiet differently from each other (see median graph). More on that another time.
• More $3m+ is bought later in the year than early. (2009 graphed below)
• There are some real name streets around and there are some falsies (where if you pay top dollar you will stand out like a beacon)
• Less than a quarter (25%) of $3m+ homes sell under the hammer at auction (click on September Graph below)
• A lot more activity is off market (not advertised) at this $3m+ level than any other price point, e.g. sub $3m.

Click on any of the graphs below to bring them up to full size

Agent Comments on the current $3m+ market

• “Prior to the school holiday period there was some renewed strength in $3m+ market due to things stabilising after the election and to the shortage of good quality homes. With the spring market in full swing it will be very interesting to see what happens with the increase of volume. But if the enquiry rates are anything to go by, October will be a strong month of sales.” Andrew Hayne of Marshall White Malvern
• “The $3 million plus market is strong, and we are expecting a big finish to spring in this market for good family homes.” Nick Johnstone of JP Dixon Brighton
  
• “There seems to have been a resurgence of buyer enquiry for the upper end properties recently.  It will be interesting to see if this follows through once we see increased stock levels after the school holidays and round 2 of the Grand Final.” Julian Augustini of Hodges Brighton
• Andrew Baynes from Kay and Burton South Yarra “Last Monday was the busiest auction sign up day for me in 10 years.”

Media Monitor: Domain – The Age 2/10/10. Headlined: “Hands up if you don’t have a clue” by Josh Jennings. Basically a solid article – but Josh, how many homes has Dr Damien Eldridge, Economics Lecturer from La Trobe University, bought using his quoted bidding advice this year? Would it have been 5 or 10 or 50? Going by his auction comments we were unclear as to whether you were holding him out as an expert – or simply providing supporting evidence to your headline.

We are not all brickbats here for the mainstream press. Congratulations to Chris Vedelago from The Age who this year has been consistently reporting the market as it really is and who actually seems to get out of the ivory tower (that so many property reporters are stuck in) and goes to auctions and talks to agents. We mightn’t always agree with you Chris, but we respect your work. Keep it up and keep getting out into the market.

Market News TV: On Tuesday of this week we ask the question: Is the ACCC or CAV the right watchdog for the real estate industry? Check out our Agent Opinion Videos.

Buyer Masterclass: We conclude our Negotiation Masterclass series with an article on Backward Bidding. From next week until Christmas we will be looking at “Pricing and Values” in Million Dollar Melbourne

Reported Results:

Big Crowds on Canterbury: 42 Wattle Valley. Bought After: Richard Winneke: Over $3,426,000: Photo courtesy Jellis Craig.

September Executive Summary:

Demand: Solid and increasing

• Reported Boughts: 46
• Bidderman: Substantial improvement in bidders per auction at the higher level. Random cross section of bidders. 1/3/2/1/3/1/3/2/2/3/3/3/2/1/0/0 for a month average of 1.875

Supply: New Stock Low

• Overhang from May however new stock is still light on at end of September and that which comes on at a reasaonble price is mostly being bought.

Price: Firming

• A number of stales (on market over 3 months) were purchased in Bayside reducing overhang – this will have an upwards effect on price if demand remains constant.
• Some new properties coming onto the market but new stock is still limited in Boroondara and Stonnington also encouraging price in an upwards direction.

Quote of the month: Stewart Lopez of Kay and Burton ” In this improving Upper End market, sellers are getting back the control that they lost with the stock splurge in May”

Highlights
Over $9 million
Hawthorn 24 Coppin: Jock Langley: Around $9,000,000 Private Sale. This basic house, on an acre on the river in Hawthorn’s river precinct, has been on the market for well over a year and had quotes at $15m then 12m and then…. A number of agents have worked on this. I went through this home last year and finally Jock Langley has got a sale through under $10m. It is a great block, its only fault until today was its price tag.
Brighton 292 New: Brian Devlin and Regina Schmidt: Around $9,000,000 Private Sale. Up for sale for less than a month, this grand looking home was purchased today for around $9,000,000. A very impressive block just down from Brighton Grammar.
Over $7 million
Toorak 11 Cole: Ross Savas: Private Sale: Quote $8,000,000 plus reported as bought for above that figure
Undisclosed Rating: http://www.james.net.au/rating/11-Cole-Court-TOORAK
Hawthorn East 49 Harcourt: James Tostevin: Bought After: Over $7,200,000: Bidderman 2
James Auction Report: http://www.marketnews.com.au/auction-reviews/8661/49-Harcourt-Street-HAWTHORN_EAST/
Brighton 6 Head: Jeremy Fox: Sold well after auction: Around $7,000,000
Full Rating: http://www.james.net.au/rating/6-Head-Street-BRIGHTON

Bidderbuzz Auction of the Month
24 Somers Malvern: Jeremy Fox: Under the hammer: $6,160,000: Bidderman 3
James Auction Report and Rating: http://www.marketnews.com.au/auction-reviews/8705/24-Somers-Avenue-MALVERN/
The sunfilled courtyard was a perfect setting for the Somers Avenue auction, with the lovely weather attracting a generous crowd of interested parties and onlookers alike. Auctioneer Jeremy Fox asked the crowd for an opening bid, but was disappointed with silence. It wasn’t long before a confident bid of $5,000,000 soon had the ball rolling though. Two parties continued with strong bidding, as the crowd watched on with baited breath. It was at $5,650,000 when another bidder keenly entered the fray, enquiring if the house was in fact yet ‘on the market’. There was clear buzz of anticipation amongst the crowd, as Mr. Fox conferred with the vendors, and finally confirming in the positive. Bidding continued fast and furiously between bidders, whilst the crowd remained captivated. The final knock-out bid brought on a genuine look of relief to the successful bidder. A truly entertaining auction, as you could hear echoed amongst the departing onlookers. (Nikki Hills)

Late Entries (Not Included in Stats)
Brighton Black St: Peter Bourbaud and Barb Gregory: Off Market: James Home Rating 852/1000. Price Undisclosed
Toorak 5 Myrnong: Darren Krongold and Sally Zelman: Private Sale: Price Undisclosed
James Rating: http://www.james.net.au/rating/5-Myrnong-Crescent-TOORAK
Armadale 23 Moorhouse: Gowan Stubbings: Expressions of Interest: Price over $5,000,000
James Rating: http://www.james.net.au/rating/23-Moorhouse-Street-ARMADALE

Apartments:
East Melbourne 144 Jolimont Road: Marcus Chiminello: Penthouse $3,250,000
Melbourne 301/401 St Kilda Road: Marcus Chiminello: Lucient $3,100,000

Albert Park
Albert Park 62 Beaconsfield: Kaine Lanyon: Quote $3,500,000 to $3,750,000: James Home Rating 655/1000: At Auction: Over $3,300,000
James Rating: http://www.james.net.au/rating/62-Beaconsfield-Parade-ALBERT_PARK

Armadale
81 Rose: Tim Derham: Bought Over $3,300,000. A  terrace home that needed a fair bit of work but did have rear access and was north facing to rear. Solid result.
James Undisclosed Rating: http://www.james.net.au/rating/81-Rose-Street-ARMADALE
21 Adelaide: John Bongiorno auctioned this “bulldozer or significant rebuild” home at 4.30pm today. Bought for $3,130,000 or just over $4,000 per sqm. Bidderman 3. Heather Elder and Rae Tomlinson
James Undisclosed Rating: http://www.james.net.au/rating/21-Adelaide-Street-ARMADALE
28 Seymour: Joanna Nairn: Quote $3,500,000 plus: James Rating 682/1000: Bought After Auction: Around $3,500,000: Bidderman 1
James Auction Report: http://www.marketnews.com.au/auction-reviews/9007/28-Seymour-Avenue-ARMADALE/
1 Myamyn: Andrew Macmillan: Under the hammer: $3,215,000: Bidderman 2
James Auction Report: http://www.marketnews.com.au/auction-reviews/8670/1-Myamyn-Street-ARMADALE/
3 Avalon: Ross Savas: Bought: Reportedly over $7,000,000, but not confirmed:
James Rating: http://www.james.net.au/rating/3-Avalon-Road-ARMADALE

Balwyn
Balwyn 23 Bevan: Richard James & William Chen: Quote $3,300,000 to $3,600,000: James Home Rating 742/1000: Bought After Auction: Around $3,500,000: Bidderman 1
James Auction Report: http://www.marketnews.com.au/auction-reviews/8932/23-Bevan-Street-BALWYN/

Brighton
10 Campbell: Peter Kennett. Private Sale after a Pass-In Auction. In excess of pass-in $3,850,000.
James Undisclosed Rating: http://www.james.net.au/rating/10-Campbell-Street-BRIGHTON
20 Bent: Justin Follett. Private Sale . Within asking price range $3,800,000 – $4,000,000.
James Undisclosed Rating: http://www.james.net.au/rating/20-Bent-Street-BRIGHTON
7 St Ninians: Nick Johnstone. Private Sale. In excess of  $3,500,000.
James Undisclosed Rating: http://www.james.net.au/rating/7-St_Ninians-Court-BRIGHTON
292 New: Brian Devlin and Regina Schmidt: Around $9,000,000 Private Sale. Up for sale for less than a month, this grand looking home was purchased today for around $9,000,000. A very impressive block just down from Brighton Grammar.
James Undisclosed Rating: http://www.james.net.au/rating/292-New-Street-BRIGHTON
22 Tennyson: Marcus Gollings. Private Sale. In excess of $5,000,000.
James Undisclosed Rating: http://www.james.net.au/rating/22-Tennyson-Street-BRIGHTON
3/9 Glyndon: Stewart Lopez: Private Sale: Mid $3,000,000’s
James Rating: Click here http://www.james.net.au/rating/3/9-Glyndon-Avenue-BRIGHTON
6 Head: Jeremy Fox: bought well after auction: Around $7,000,000
Full Rating click here: http://www.james.net.au/rating/6-Head-Street-BRIGHTON
19 Wellington: Stewart Lopez and Sturt Hinton. Private Sale after Auction. Over $4,000,000
James Rating: http://www.james.net.au/rating/19-Wellington-Street-BRIGHTON
3 Wellington: Stewart Lopez and Sturt Hinton. Private Sale after Auction. Around $3,900,000
James Rating: http://www.james.net.au/rating/3-Wellington-Street-BRIGHTON
5/23 St Ninians: Stewart Lopez and Sturt Hinton. Private Sale under $5,000,000
James Rating: http://www.james.net.au/rating/5/23-St_Ninians-Road-BRIGHTON
6 Seacombe: Ian Jackson: Private Sale over $4,500,000
James Rating: http://www.james.net.au/rating/6-Seacombe-Grove-BRIGHTON

Camberwell
8 Canterbury: Peter Mitchell: bought after auction: Around $3,000,000: Bidderman 3
James Auction Report: http://www.marketnews.com.au/auction-reviews/7926/8-Canterbury-Road-CAMBERWELL/

Canterbury
42 Wattle Valley: Richard Winneke: bought after, in excess of $3,426,000: Bidderman 1
James Auction Report: http://www.marketnews.com.au/auction-reviews/8807/42-Wattle_Valley-Road-CANTERBURY/
23 Chaucer: James Tostevin: bought after over $3,850,000: Bidderman 3
James Auction Report: http://www.marketnews.com.au/auction-reviews/8221/23-Chaucer-Crescent-CANTERBURY/

Elwood
31 Ormond: Marcus Gollings: Expressions of Interest: Bought over $4,000,000
James Undisclosed Rating: http://www.james.net.au/rating/31-Ormond-Esplanade-ELWOOD

Hawthorn
2 Berkeley: Rob Vickers-Willis: Bought at Auction: Bought over $3,000,000
James Undisclosed Rating: http://www.james.net.au/rating/2-Berkeley-Street-HAWTHORN
24 Coppin: Jock Langley: Around $9,000,000 Private Sale. This basic house, on an acre on the river in Hawthorn’s river precinct, has been on the market for well over a year and had quotes at $15m then 12m and then…. A number of agents have worked on this. I went through this home last year and finally Jock Langley has got a sale through under $10m. It is a great block, its only fault until today was its price tag.
James Undisclosed Rating: http://www.james.net.au/rating/24-Coppin-Grove-HAWTHORN
36 Chrystobel: Lisa Jarrett: Private Sale after auction: In excess of $3,500,000
James Auction Report: http://www.james.net.au/rating/36-Chrystobel-Crescent-HAWTHORN

Hawthorn East
49 Harcourt: James Tostevin: Bought After, over $7,200,000: Bidderman 2
James Auction Report: http://www.marketnews.com.au/auction-reviews/8661/49-Harcourt-Street-HAWTHORN_EAST/

Ivanhoe
59 Studley: David Oster: Under the hammer: $4,300,000: Bidderman 2
James Auction Report: http://www.marketnews.com.au/auction-reviews/8989/59-Studley-Road-IVANHOE/

Kew
63 Walpole: James Tostevin: Bought Before Auction: In excess of $3,000,000.

Malvern
24 Somers: Jeremy Fox: Under the hammer: $6,160,000: Bidderman 3
James Auction Report: http://www.marketnews.com.au/auction-reviews/8705/24-Somers-Avenue-MALVERN/
15 A Sorrett: Andrew Hayne: Week or so after Auction: Over $3,500,000
James Auction Report: http://www.james.net.au/rating/15a-Sorrett-Avenue-MALVERN
Elizabeth: Marcus Chiminello Off the plan $3,300,000
6 Bonview: John Bongiorno: Bought Afterwards in excess of $3,600,000: Bidderman 3
James Video Auction Report: http://www.marketnews.com.au/video/?vid=305
11 Moorakyne: Michael Gibson: Under the Hammer: $4,000,000: Bidderman: 3
James Rating and Auction Report: http://www.james.net.au/rating/11-Moorakyne-Avenue-MALVERN
17 Thanet: Mark Wridgway: Before Auction: Bought over $3,500,000.
James Home Rating: http://www.james.net.au/rating/17-Thanet-Street-MALVERN

Malvern East
31 Finch St: Andrew McCann: Under the Hammer: $3,360,000: Bidderman 2
James Auction Report: http://www.marketnews.com.au/auction-reviews/8376/31-Finch-Street-MALVERN_EAST/

South Yarra
38 Park: Warwick Anderson: Quote $3,500,000 plus: James Rating 725/1000: Bought After Auction: Above $3,000,000: Bidderman 1
James Auction Report: http://www.marketnews.com.au/auction-reviews/8476/38-Park-Place-SOUTH_YARRA/
19 Acland: Greg Herman: 4 bidders: Bought under the hammer: $3,600,000
James Auction Report: http://www.marketnews.com.au/auction-reviews/6886/19-Acland-Street-SOUTH_YARRA/

St Kilda
Two Block of Flats:
4 Church: Claudio Perruzza: Bought at Auction $3,400,000
16 Charnwood: Adam Joske: Bought at Auction $6,060,000

Toorak
11 Cole: Ross Savas: Private Sale: Quote $8,000,000 plus reported as bought for above that figure
Undisclosed Rating: http://www.james.net.au/rating/11-Cole-Court-TOORAK
2/23 Tintern: Ross Savas: Private Sale: Quote $5,000,000 plus reported as bought for above that figure
Undisclosed Rating: http://www.james.net.au/rating/2/23-Tintern-Avenue-TOORAK
8 Macquarie: Jeremy Fox: Private Sale after auction. $6,400,000.
James Rating: http://www.james.net.au/rating/8-Macquarie-Road-TOORAK
4 Forrest Court: Peter Kudelka and James Scarff: Bought after auction $4,050,000: Bidderman 0
James Auction Report: Click here http://www.marketnews.com.au/auction-reviews/8829/4-Forrest-Court-TOORAK
1 Hopetoun: Justin Long: Bought after auction: Over $5,500,000: Bidderman 0
James Auction Report: http://www.marketnews.com.au/auction-reviews/8671/1-Hopetoun-Road-TOORAK/
803 Orrong: Warwick Anderson: Private Sale $4,500,000
Undisclosed Rating: http://www.james.net.au/rating/803-Orrong-Road-TOORAK
1a Como: Greg Herman: Private Sale: Over $6,400,000

Please Note: The $3m+ market can be a very shadowy one at times with regards to what is bought, if indeed it was actually bought and what price (cash and/or otherwise) was paid. At all times the prices we outline are never truly confirmed until they can be viewed six to nine months later at the Government stamp duties office – however we don’t publish without feeling there is a high degree of truth. This is why as buyer agents when pricing homes we never make decisions on one buy alone and why true land and building values plus an overall knowledge of all buys is vital in calculating correct market value.  At this price level it is also a very private world and we respect that when trying to balance market transparency v individual privacy. We accept we don’t get it right every time but we do try. We never discuss buyer/seller personalities; we do not reveal intimate details to the wider press and we do not disclose full details publicly where the source has asked us not to. Our sources are not just the selling agent, but underbidders, our own advocates, REIV, our auction reporters and other agents not connected with the sale/buy. If you aware of an error or omission please email mal@james.net.au and we will adjust – you will be treated confidentially if you wish.

Looking cool under pressure, Michael Nolan (Noel Jones) tries to encourage some bidding at 11 Scheele St, Surrey Hills. One bidder entered the fray, the property was passed in at $1,100,000 and bought afterwards for $1,150,000.

Key Points:

• Balwyn 23 Bevan, Richard James & William Chen. Quote $3,300,000 to $3,600,000. James Home Rating 742/1000. Bought After Auction Around $3,500,000. Bidderman 1. James Video Auction:  http://www.marketnews.com.au/video/?vid=316
• Hawthorn 24 Coppin, Jock Langley. Around $9,000,000 Private Sale. This basic house, on an acre on the river in Hawthorn’s river precinct, has been on the market for well over a year and had quotes at $15m then 12m and then…. A number of agents have worked on this. I went through this home last year and finally Jock has got a sale through under $10m. It’s a great block, and its only fault was its price tag.
• Kew 30 Wills, Scott Patterson. 3 bidders. $2,615,000. Under the hammer
• There were bidders at all 10 auctions we went to (although Aberdeen St Hawthorn East was bought immediately after auction, after no prior bidding)
• Clearance Rate of 78% on the 36 $M+ auctions we monitored

Agent Q & A: Premierships and Stock?
Andrew Gibbons, Marshall White, Hawthorn: “Oh … you would have to go the “CATS” my friend…back to back Premierships…they clearly are the most dynamic team in the way they handle the ball and play as a team. They are in fantastic shape with all the key players fit & healthy…they are HUNGRY!”

John Bradbury, Noel Jones, Balwyn: “You would have to say Collingwood, unfortunately. I would like to think the Saints could get up and win but after Collingwood’s defeat of Geelong, you’d have to go the Magpies.”

Michael Nolan, Noel Jones, Balwyn: “After (Friday night), Collingwood. They made Geelong look old!”

Daniel Bradd, Jellis Craig, Hawthorn: “The Bulldogs because it’s about time.”

Richard Winneke, Jellis Craig, Hawthorn: “The Saints because it’s about time.”

Daniel Wheeler, Marshall White:”There are few good houses coming on the market in the next few weeks”

Doug McLauchlan, Marshall White, Hawthorn: “Stock is extremely low at the moment and the concern is that potential stock offered in October will not come onto the market until much later in the year. These low stock levels could be in  part due to the exceptionally high stock levels on the market in the early part of the year. Added to this, an election that took 7 to 8 weeks to resolve wasn’t helpful. Uncertainty seems to be an issue.”

Bidderbuzz Auction of the Day: 2 Cusdin St, Glen Iris, Paul Williamson, Jellis Craig, Bought Under the Hammer, $1,300,000, 3 bidders.

“There was a good feeling at this auction. So much so, that agent Paul Keane had time to look after someone’s pet dog while they were doing a pre-auction inspection. This atmosphere continued as the auction gained some momentum and, after an initial vendor bid of $1,100,000, two bidders competed as if it was a two-horse race. Just at the pointy end of the auction, after eleven bids, came a bold and aggressive bid of $1,300,000, which blew the two other bidders out of the water – and the property was sold at this price.” (Guy Angwin)

Biggest Auction of the Day: 30 Willis St, Kew, Scott Patterson, Jellis Craig, Under the Hammer, undisclosed above $2,600,000, 3 bidders, crowd of 80 people.

“There was anticipation in the air as auctioneer Scott Patterson commenced proceedings with a vendor bid of $2,400,000. With the clouds clearing, things progressed rather slowly until a very determined bidder entered the fray, and the auction began to take shape. Three genuine buyers all fought to secure this great piece of Kew, which created a very exciting auction. After some boisterous back and forth bidding, the successful buyer secured the property for his client for an undisclosed amount.” (Dustin Cracknell)

Clearance Rates & Monitor Table:

Forward Auctions:

Glen Coutinho (Hocking Stuart) means business at 12 Beaconsfield Rd, Hawthorn East. Under the hammer, $1,256,000, three bidders

Key Points:

• We covered 11 auctions across Boroondara on Saturday. Of those, 4 sold under the hammer, and 4 were bought after.
• Bidders on all bar one auction.
• Big crowd increases.
• The biggest auction of the day was 42 Wattle Valley Rd, Canterbury (Richard Winneke of Jellis Craig), which had an after-auction sale price in excess of $3,400,000 and a massive crowd of around 250 people.
• 2 Berkeley St Hawthorn suprisingly sold – considering it was surrounded by for a number of overlooking flats – Robert Vickers-Willis of Abercrombys – good get at over $3,000,000

Biggest Auction of the Day: 42 Wattle Valley Rd, Canterbury, Scott Patterson, Jellis Craig, Bought after (undisclosed in excess of $3,400,000), 1 bidder, crowd of 250
“Like most people in Melbourne I love going to the football. Now, those reading this might say “what are you on about Guy? This is a property report”. Well, the picture I am trying to paint is the auction at 42 Wattle Valley Road was just like going to the football – the crowd has huge! Probably close to three hundred people. Inside the house there were queues to get into the bedrooms and trying to get upstairs was near impossible. This was anticipated as this was a very special house. You don’t get a James Buyer Rating of 805 unless it ticks all the boxes. Now back to the auction, what an anticlimax! If you were the vendor you would think there must have been a number of parties amongst the crowd looking to lock horns and fight to the death to buy this stunning home. Unfortunately there was little bidding action . After a vendor bid of $3,425,000, there was a very last minute bid of $1,000 just to secure right to negotiate after the auction.” (Guy Angwin)

Agent Q & A: What is your view on pricing?

Scott Patterson, Jellis Craig, Hawthorn:“The  market is patchy at the moment and we are seeing mixed results. The homes with the ‘wow’ factor often attract concentrated bidding at auctions and with the properties that don’t need work, there is always more interest in those as many people don’t have the time to fix them up. As for the homes with poor floor plans, it certainly affects their appeal. I would say there is a 20 per cent difference in price to those with good floor plans.”

Glen Coutinho, Hocking Stuart, Hawthorn:“Now that the government is sorted out, the market should remain healthy between now and Christmas. There is a shortage of good houses. Apart from the usual disruptions of the AFL and the racing season, there are still some good selling days.”

Bidderbuzz Auction of the Day: 34 Kinkora Rd, Hawthorn, David Oster, Jellis Craig, Under the hammer $2,690,000, 6 bidders
“Auctioneer David Oster led a ripper of an auction in the highly sought-after Grace Park Estate. There was interest from the get go with an opening genuine bid of $2,000,000, promptly followed by two others from the crowd of around 150. As the price rose so did the bidder numbers – 6 in total, joining the quest to secure this Hawthorn home. The determined bidding of one at $2,500,000 saw the property go on the market soon after at $2,506,000. At $2,690,000 five bidders bowed out to the unwavering bidder left standing. The crowd erupted in applause at this strong result and quickly disappeared, most likely for a coffee at nearby “Liar Liar” to recall the entertaining spectacle of this Spring mid-morning auction.” (Julia Atkinson)

Clearance Rates & Monitor Table:

Forward Auction Stock Levels

Not everyone in Melbourne was home watching the football on Saturday. Around 250 people watched Scott Patterson (Jellis Craig) in action at 42 Wattle Valley Rd, Canterbury. Passed in $3,425,000. One bidder. Bought after, undisclosed.

We only buy homes

First cab off the rank: 10am auction at 12 Barry St Kew: and a range of emotions for Alastair Craig, Chloe Quinn and Richard Winneke, all of Jellis Craig, as they sail through the reserve at $1,650,000 and on to an impressive $1,950,000. 5 bidders. (Photo Amy Wong)

At 6pm on Saturday, the James Million-Dollar-Plus Clearance Rate was 72% for the 36 auctions we attended on a wild and woolly Melbourne Saturday afternoon. It was a tricky day for auctioneers, spectators, reporters and photographers, with cosy indoor or wet outdoor auctions the norm.

Bidderman, our Demand Indicator, was at 1.6 bidders per auction.  We think Bidderman was almost as strong as last week, despite dropping a little this week. Today, only one in six auctions had no proven bidders; with a few selling afterwards despite no bidding at auction (Reed St Albert Park, Hopetoun Road Toorak, and Oakwood Avenue Brighton). To further support our claim of a stronger Bidderman, only two of the auctions we attended today had five bidders or more; meaning there was an even spread of bidders across most properties offered. Also we had a focus (possible statistical distortion) on $3 million-plus auctions today where you would expect less bidders per auction. Overall Bidderman was solid.

Overall Market: Right now, the market may be better than you think … and for some, it may be poorer. The million-dollar-plus market we cover is a tale of two cities.

By the Bay, a few are talking the market up and they are doing so without supporting numbers (except in isolated pockets eg $3 million last fortnight). In the East, a number of market watchers have been talking the market down but they too are not supported by recent numbers of the past fortnight.

The overall market went through a flat spot from May to early August (flat or plateau is agent code for falling prices), due initially to larger than normal stock numbers (supply), which was not matched by demand and then the winter hiatus tapered things off. However, over the past two weeks, the numbers have been stronger for sellers as the market has been strengthening. It’s early days though and October is the real test.

At marketnews, we have a few measurements that give us perspective snapshots of what the overall million-dollar-plus market is doing.

Market Strength – we measure number of bidders per hundred auctions / clearance rate per hundred auctions and the past two weeks have been 160 (bidders per 100)/72 (clearance rate) and 190/65 respectively – it’s a measurement just like your blood pressure. To give you some perspective: in the heat of the Spring 2009 and Autumn 2010 markets, we had some 300/80 weekends and in the depths of the GFC we had 80/40 weekends. On the 19 June 2010 auction weekend, just as we were going into winter, we had 110 bidders per hundred auctions/50% clearance rate or 110/50. Our yardstick for a strong and possibly price increasing market is 200/70; that is 200 bidders per 100 auctions/ 70% $M+ clearance rate, providing this can be sustained for four to six weeks and the market is of a reasonable size.

Market Size: So to check the size of the million-dollar-plus market within our focus areas, we also look at numbers of million-ddollar-plus auctions. Again 100 is the number. 100 million-dollar-plus auctions (Boroondara, Bayside, Stonnington and Port Phillip combined) is a strong weekend. Perspective:  at the peaks in May, we were over 150 auctions per weekend; however, by early August, we had dropped to 60 auctions, each of the first two weekends, with the election and almost no auctions on the third weekend. Since the election, we have had 103 and 91 auctions - (remember 100 as a good-sized weekend).  This shows that both weekends have been good-sized markets with reasonable bidder strength and solid clearance rates meaning for us – an improving market.

$3M+ Market: This market continues to blossom likes the new buds of spring – it’s not on fire, price or number wise, but it is starting to emerge from its winter doldrums – an increase in October stock may of course stop it in its tracks – let’s wait and see. See our full $3m+ report this Monday (below Buyer Masterclass). Some highlights: 6 Head St Brighton (beachfront Golden Mile), which looked liked global warming may get it before a buyer did, was reported sold this week for we believe around $7,000,000 – Jeremy Fox RT Edgar. Add in 1a Como over $6,000,000 - Michael Ebeling and RT Edgar is also showing the $3m+ market has some legs. Today’s auction results confirm this as an early trend.

Please note this is our overall opinion across Melbourne on our sampled data and it’s a snapshot only. Furthermore, if you were just focusing on Boroondara you would say the market is actually at the tipping point of price improvement for sellers. If your buying focus is Bayside, then you would call us spin doctors if we proclaimed the overall market as strong. It’s only two weeks of Spring data and October really is the big Spring test but, for now, it seems a strengthening market and a tale of two cities.

Highlights:

• 49 Harcourt St, Hawthorn East: James Tostevin of Marshall White 2 bidders  (over $7,200,000)
  James Auction Report: Did you hear that the $6m+ market is a little quiet in Boroondara? Oh you did – well, James Tostevin and his two Harcourt bidders hadn’t. Look, it’s a really good home, but I thought a vendor bid at $6,800,000 courageous – then again, what do I know! I was even more surprised when a first, and then a second, bidder joined in over $7,000,000. Passed in and bought after, believed to be in excess of $7,200,000. That by any stretch was an above average result.
• 1 Myamyn St, Armadale  Andrew Macmillan of Benmac 2 bidders $3,215,000
• 6 Bonview Rd Malvern – Peter Bennison  of Marshall White (more than $3,700,000) 3 bidders.
• 19 Acland St, South Yarra - Greg Herman and Warwick Anderson of RT Edgar $3,600,000 and 4 bidders
  James Auction Report: After a day of pass ins and relatively low attendances, it was nice to attend an auction with multiple bidders all looking to secure a fine property in a much sort after area. Four keen bidders kept auctioneer Warwick Anderson’s attention as they showed their interest early, bidding strongly and quickly looking for that knock-out blow. It came fifteen minutes later for a price of $3,600,000. (Guy Angwin)
• 1 Hopetoun Rd, Toorak – Justin Long of Marshall White (undisclosed over $5,500,000): 0 bidders – bought after.

Lowlight:

• The continuing poor performances in the Bayside markets for sellers.  With most results in, we are looking at 33% (Port Phillip) and 50% (Bayside) clearance rates. This is only compounding the overhang problem that still exists from the May stock oversupply which resulted in a number of Winter stales (unsolds). There has to be opportunity here for fringe buyers of fringe homes and possibly for good buyers of good homes, especially if October brings more stock but no more bidders.

A little bit different(1): In-house auctions.
Last Wednesday at 6pm, Peter Batrouney and Richard Earle of Jellis Craig auctioned six blocks of land (Walpole St Kew) at the QPO coffee shop  in Kew. This is rare in residential auction terms in Victoria as it was not on location. It’s not so rare in other states  or in the commercial auction world where many auctions are carried out in a big auditorium away from the property. It was interesting to note this form of auction was a complete success with five from six selling under the hammer and the final one the following morning. Five of the six were reported as being sold to Asian buyers and new homes will go on all six blocks. Price ranged from $1631 per sqm facing Peel St to $2121 per sqm facing Walpole St. All blocks were sold between $1,250,000 and $1,625,000. As we keep saying, nothing wrong with the Boroondara market this past month or so.

Editorial: No auction lover would like to see Melbourne’s unique street theatre evaporate – more go to auctions than a game of AFL footy. So please not too many of these – they’re boring.

A little bit different (2)
Remember the 70s TV show called The Persuaders with Roger Moore and Tony Curtis?  How apt a title for these two. It should not be hard to believe and apologies for the lack of focus but Alastair “Tony” Craig (Jellis Craig) and James “Roger” Connell (Marshall White) share a lighter moment at the Harcourt St Hawthorn East auction – who said they’re all enemies.

Shoe Sale at 2 Crest Avenue Balwyn - buy any pair over $2,600,000 and you get a free home says Doug McLauchlan of Marshall White. One bidder took up his offer post auction.

John Bongiorno of Marshall White “With 19 from 23 sold today (MW) we now seem into a very normal market and it was bordering on strong today – for us this is a far cry from election and mining tax interruptions of a month ago. We are still 15% down on stock on last year but just as you thought the pendulum maybe swinging the wrong way - it didn’t.”

Mark Rathgeber of Noel Jones “The market is solid in and around a million dollars. Once you get towards two million dollars in Balwyn you need to be new and French Provincial or something else and discounted. The Asian market is no longer paying anywhere near new home prices for second hand stock.”

Richard Earle of Jellis Craig “The numbers speak for themselves  with 27 from 35 auctions (JC) sold today. Yes buyers are shying away from overprice and poor homes but nothing new there. We are in lower stock level territory now and the market is reflecting that by strengthening – October will be an interesting congruence of vendor expectation and bidder demand and how they react with the anticipated stock increases – assuming the election doesn’t continue to drag on.”

BidderBuzz Auction of the Day: 68 Head St, Brighton, Leigh Hallamore, Buxton, 5 bidders:
“A 100 strong crowd, many of whom were interested onlookers, awaited this Brighton auction. There was a chatty convivial vibe despite the poor weather. Leigh Hallamore was energetic in his approach and with a bid of $1,500,000 from within the crowd the auction was off to a flying start. Five bidders were vying for this property with Mr Hallamore getting an aerobic workout as her swivelled from one bidder to the next, spread out in the crowd. The property was bought under the hammer for $2,255,000 to a round of applause. A great result.” (Sue Agnoleto)

Issue: Stock Levels.
The last few weeks the marketnews has been reporting a lean September and a stronger October stock wise and the graph below confirms this with low stock levels leading into the election a good burst for the last fortnight and now declining numbers until the first week in October.

Marketnews TV: This week Klarity Kris questions the Ladies in Red – Jenny Dwyer and Barb Gregory of Hocking Stuart – about Quoting and Reserves – check out the agent opinion videos to the right of this article. Next week Andrew McCann from Benmac responds to selling agent comments and criticisms of his company’s ”reserve within the quote range” point of difference policy. Marketnews TV is good TV this and next week.

Video Auctions: This week we have videos from Architect Adam at 4 Reed St, Albert Park and Klarity Kris is at 6 Bonview Rd, Malvern. Check them out on Market News TV.

Buyer Opinion: Buyer Masterclass tackles “Negotiation is all in the mind(set)” and on Wednesday look out for “Negotiation through Cultures”. All this is building towards our “Backward Bidding” article coming to you Grand Final week.

We Only Buy Homes and Go Pies – how good are we looking!

Anybody care for a dance? Tim Fletcher said yes and three bidders came with him. 15 Louise Avenue Mont Albert: Bought under the hammer for $1,825,000. (Photo Amy Wong)