SANDRINGHAM, 18 Neptune St: The dynamic duo, Hocking Stuart's Steve Tickell and Jenny Dwyer, tried hard but couldn't get this one over the line. Passed in, $1,300,000, no bidders

• Overall Bayside seems to be going backwards in terms of market dynamics, with the $M+ fringes (ie Beaumaris) having very mixed results
• Three vacant blocks of land, high on the Balcombe Rd hill, sold before auction for $1,400,000 each – that’s a total of $4,200,000.
• Another Balcombe Rd, Beaumaris property sold before it was due to go to auction on Saturday (Thomson), also in excess of $1,000,000.

BRIGHTON, 2C Dudley St: No one was hedging their bets on this property, Leigh Hallamore (Buxton), passed in $5,000,000, no bidders

HAMPTON, 56 Linacre Rd: Come on! Just one more! Mark Earle (Buxton) does his best to squeeze every last bid from the crowd. Bought under the hammer for $1,650,000, 2 bidders

Key Points:

• Clearance Rate for quality homes was stronger than our stats show today
• If you went to auction in Brighton, Brighton East or Hampton today you had a good chance of selling with clearance rates 81% (13 from 16). Further down the bay like Sandringham and Beaumaris really struggled.
• Hampton 7 Raynes Park Road with Stephen Wigley Hodges recorded a strong $2m plus result and a volcano (4 or more bidders) – a bit of a rarity for that neck of the woods – $2,204,000.
• Land Price Check with 29 Bay Street Brighton (Bert Stewart of Buxton) selling post auction over $3,550,000 and the final result put north facing (no view) Golden Mile land at over $3,200 per sq metre. That is a steady as she goes price similar to last year Golden mile (no view) buys. 7a Dawson with Nick Johnstone of JP Dixon confirmed this price by selling 762 sqm of irregular land for $2,500,000 at auction – almost identical psqm prices.
• And another $3m+ sale with a strange twist (all non bidders asked to leave) at 40 Drake Brighton (Ian Jackson).

Agent Q & A : How does current pricing compare with the same time last year?

Robin Parker, RT Edgar, Brighton: “The hot topic at the moment amongst many in the market is “what are prices doing”? Well, the short answer is it’s steady. Certainly the less attractive , or the inferior positioned properties, are finding it tough. However if you weigh up the prices of  desirable homes in desirable suburbs in desirable streets,compared to this time last year, then you start to realise it’s  “steady as she goes”. So if it feels right, if the times right, then go for it.”

Scott Hamilton, Buxton, Brighton: “Pretty similar.”

What are you talking about? - course the market's OK! St Kilda East 239 Alma Road: Phillip Kingston: Bought for $1,500,000: 3 bidders (Photo Kate Agnoleto)

At 6pm on Saturday, the James Clearance Rate on the 31 auctions we covered was 58%.

Bidderman, our demand indicator of average bidders per auction, had a small rise to 1.6 bidders per auction, in part due to four volcanoes (strong auctions) including one 7 bidder auction in 28 Barrington St Kew.

These figures indicate that the market has now cooled – not frozen or falling apart, just cooled. That means we have moved into a buyers’ market, perhaps until Easter and possibly until Spring.

Well-priced homes are still selling. And there have been some surprising above-expectation results, such as 28 Barrington Kew (Glen Coutinho) which sold for $2,230,000 and, last week,Victor Road Kew (James Tostevin) at $4.1 million. But if the market doesn’t agree with initial pricing then it’s a slow, torturous journey to get a result. See our special Pass-Ins and Stales Report below.

This week we also look at the returns of serve on The Economist’s article as the ‘Experts’ hit back against the “Overpriced” headlines of last week.

This Weekend’s Market Summary:

This weekend in most places, except Boroondara, there was limited $M+ stock on offer at auction. The individual council clearance rates we report on in our market wraps could be distorted due to a) lack of auctions and b) lack of overall quality in those auctions. But this is not to imply a lack of stock in general – there are high levels of $M+ stock available across the board and Boroondara in particular is almost awash with homes on the market.

Looking specifically for a moment at Boroondara (Kew, Hawthorn, Canterbury and Camberwell), while this market may be a little out of kilter with the rest of Melbourne in terms of auction numbers, in the past few years it is a market that has shown the strongest resilience against negativity. It was affected by the GST for the shortest time, and has had the biggest price increases since. This weekend too it seemed to have a little oomph and we expect the clearance rate for Boorondara $M+ homes to be in the high 50s to low 60s.

But it does have a fight on its hands right now, with the main demand drivers (overseas buyers) reducing greatly in activity and supply to the market continuing to arrive week after week. Which means that buyers who can look beyond the headlines will find opportunities, and with the right strategies you should be in a position to push back a little against the seemingly never ending sellers’ market.

The next few weeks will be better in terms of auction quality in the top of the Top End in Boroondara. As long as those properties sell and the clearance rates stay stable, and if new stock reduces post Easter, we could move back to a balanced market. But if stock continues to come on in big numbers then the market will almost certainly remain cool with a significant change in demand sentiment.

Most of the $M+ homes on offer that sold this weekend were in the early $1 million range.

Bayside, Port Phillip, Stonnington have been quiet, with only a handful of sales in the post auction wash up from March 19th  and likewise at auction this weekend. In Port Phillip this is understandable as the Grand Prix completely extinguishes the market for almost a month. Why auction numbers are down in Brighton, Toorak and Malvern is not completely obvious – well not to us anyway. April 9th is shaping up as a Super Saturday of some sorts with almost 120 auctions in Boroondara and Stonnington combined. $M+ auctions in Bayside are still light on at the top of the Top End with mainly $1 million to $2 million homes on offer for the next few weeks leading into Easter. Most of the top of the Top End in Bayside is not going to auction.

Agent thoughts: Has the market changed since before the Labour Day weekend?
Chris Barrett, Marshall White, Hawthorn:“There have been a lot of people in the media talking about a negative change in the market since Labour day weekend, I however have found this to be unsubstantiated. As long as vendors prices are realistic and the property is presented well vendors can expect solid interest in their home.”
John Clarkson, Hocking Stuart, Brighton:“Good properties near local attractions and amenities, schools, shopping and the beach are still attracting a high level of enquiry.  Since Labour Day weekend the message is clear: If you are realistically priced you have a very good chance of selling . If you are above market perception, enquiry is reduced to a trickle.”  * For John’s full comments please see the Bayside weekly wrap.

James Special Report: Pass-Ins and Stales – The Autumn overhang build up.

We went back and re-examined all the auctions we reported on this year in 2011 and we revisited all the pass-ins, using still advertised on the net to determine their still for sale status. Please note that the table below is only connected with PASS-INS, not the homes we reported as bought before, at or just after auction on the day.

The table does make for interesting reading on the fate of a home that the market does not consider to be priced correctly at auction.

The table below shows Adjusted Clearance Rates comparing”On the Day” Clearance Rates with “On the Day plus Bought since”. Back in February 19 and 26 Pass-ins were taken up fairly quickly. However the most interesting stat is the lack of take up on Passed-in homes over the last two weeks of auctions: only 3 in 26.

• 1 of the 13 unsolds from the March 5th pass-ins and
• 2 of the 13 from the March 19th pass-ins.

This we feel confirms the view that the $M+ market started the year as balanced, but around Labour Day took a cooling direction.

What's happening Nick? Bentleigh 7 Eddys: Bought $1,312,500: 3 bidders. (Photo: David James)

James Big Issue: Agents claiming there are 100% Clearance rates in this market are just as misleading as saying the market is in freefall – both are far from the truth. Klarity Kris and Architect Adam cover it in the James Big Issue Video. Here is a summary of what they say.

• Still some surprising results. Two in particular, both in Boroondara, that stand out are Victor Avenue in Kew with James Tostevin – which sold for a hard to believe $4,100,000. Nic Franzman, Mark Dayman and Nic Ptak also from Marshall White’s result at 22 Stawell St Kew for $3,300,000. That was also a most surprising result
• We are hearing from agents 100% clearance rates – mainly due to agents feeling they need to respond to the Negativity of The Economist’s article and the Earthquakes, which for the moment have contributed to dampening demand.
• An interesting stat is that only 3 of the 26 homes we reported as passed in after auction in the last two weeks of auctions have since sold.
• We could say that 3 from 26 is reflective of the market strength – a far cry from the 100% Clearance Rate stats, BUT 3 from 26 while true, is also misrepresenting the market just as is reporting 100% clearance rates
• The market was in a balanced state pre Labour Day and as expected it is now going into a cooling phase until Easter due to increased stock levels and drop in demand intensity.

The message for buyers

• You have choice in the $3m+ range but there are still a few surprisingly strong results
• You will still have to compete relatively strongly if the home is good and well priced in that $1m to $1.5m range
• And the middle range say circle $2m to $2.5m is a bit of moving beast – the trend is not crystal clear to us at this stage.

Click on the JAMES BIG ISSUE video with Architect Adam and Klarity Kris in the middle of the home page

Media Monitor: Are Melbourne homes overpriced?

The case for being overpriced arose from The Economist’s article – which we reported on last week.  And now this week the case against those seemingly extreme overpriced by 56% headlines.

Rob Brooker head of economics from the NAB

1. Current events such as floods and Japan are affecting Melbourne short term, but long term our fundamentals are very strong.
2. Not suggesting prices are going to increase rapidly as affordability is hard pressed right now but we do have a shortage of housing stock.

His comments can be found in the excellent Kay and Burton report – sure it’s a selling tool but we listen to the expert commentary each time it’s on It’s well produced, they have credible experts and it’s relevant to our high end Melbourne market. Check it out, at least the expert comment stuff. The home fluff afterwards is up to you: http://www.kayburton.com.au/kayburtonreport

Paul Bloxham – HSBC’s chief economist for Australia and New Zealand, and a former RBA economist savages The Economist’s article stating “it’s too naive to be useful”. His main points in the Business Spectator are

1. We have an undersupply in inner city areas (totally agree with this comment)
2. Our stock is very high quality and has improved considerably over the last 20 years contributing to the increases in price paid (totally agree with this comment)
3. Very strong and improving economy (beyond our level of expertise but sounds good)

For the full article http://www.businessspectator.com.au/bs.nsf/Article/Australian-property-prices-housing-bubble-pd20110317-F24WP?OpenDocument&src=sph This was supplied by Al Craig of Jellis Craig – thank you.

‘Round the Grounds Headlines:
Boroondara- Some solid results but the trend is down under weight of stock numbers.
Bayside- Little movement on a lot of the recent Auction pass-ins
Stonnington- Small numbers of $M+ auctions today – although plenty of Top End non auction stock available
Port Phillip-With the Grand Prix – only 4 key $M+ auctions – 3 sold
More detailed analysis on our Weekly Local Council Market Wraps

Biggest Sales we can report:

• Templestowe, 9 Edwin: On the market since October of last year with Jeremy Tyrell of Fletchers. Has been bought for in excess of $4,700,000
• Richmond 37 Docker: Ken Griffith of Jellis Craig. Bought at auction, $3,300,000 – $3,500,000
• Hawthorn 23 Lisson Grove: Michael Lui of Marshall White. Bought after auction $3,600,000 – $3,800,000
• Toorak 17 Lansell, Lisa Jarrett of Abercrombys. On the market since December of last year

Biggest Sale we covered after auction: 44 Mary St Hawthorn, Antony Woodley of Marshall White. Above $2,700,000 (Undisclosed): Bought after auction, 1 bidder

Biggest Sale we covered under the hammer: 28 Barrington Ave, Kew, Glen Coutinho (Hocking Stuart), Under the hammer $2,230,000, 7 bidders (WOW)
“This Kew property did attract a crowd of 80 people, with quite a few potential buyers in the mix. The auctioneer, Glen Countinho, had to field bids from a whopping seven different bidders! Despite the light rain, the flow of the auction was quite amazing and reached the final amount of $2,230,000 before the hammer came down.” (Sonia Matmati)

Biggest Pass In: 68 Studley Park Rd, Kew, Passed in, $3,700,000
“A very pretty setting for an auction. Standing on an elevated embankment, auctioneer Richard Earle literally oversaw proceedings. He began by highlighting the virtues of this property with energy and detail. No bids came forth, however, so it was passed in for $3,700,000.”

Auction Video: This week i’ts down to Brighton with Klarity Kris at 22 Oakwood Ave, a Hocking Stuart auction with Peter Kennett. Click on the live action.

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 Master Class: Klarity Kris discusses what’s necessary when buying a home when there are kids in the picture. Is it double storey single fronted or single storey double fronted!

Copyright: Mouldy Bread Picture from ChemistryWorldBlog.

We Only Buy Homes

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.

BRIGHTON, 33 Middle Crescent: Jason Swift (Hodges) - a great auction and a great result. Under the hammer, $4,300,000, 3 bidders

Agent Q & A:“Do you feel there is currently a big difference in the results of sales of lower end ($1m) properties as opposed to those of higher end ($2m+) homes? Yes or no, and why?”
Nick Johnstone, JP Dixon, Brighton:“The strongest market at the moment seems to be the $3m+, while the hardest is the $2-$3m. I think it’s because the (high end) properties and both highly sought after and they are tightly held.”
Errol Driver, Hodges, Beaumaris: “It’s probably true to say the result is driven by the quality of the property being offered. However a constant cry from buyers when we are discussing $2m plus homes is that they would rather buy closer to town (Brighton for instance). In general terms, buyers in Beaumaris seem comfortable paying up to $1.7/$1.8m but are expecting something pretty special for their money. Finance has become a bit more of an issue since the last interest rate rise in November and people are more cautious about committing their maximum dollar to a purchase. Overall, sales activity is considerably slower than pre Xmas.”
Halli Moore, Buxton, Brighton:”The market appears steady across all ranges. Buyers have taken some confidence from the stability of interest rates. It’s too early to call how the market is going – let’s look at things at the end of the quarter, say Easter, and decide where the market is going then.”

Feeling the heat: John Clarkson (Hocking Stuart) at 12 Maroona Rd, Brighton. Bought after for $1,580,000, 1 bidder, crowd of 45

Key Points:

• We covered 8 auctions in Bayside – not one was bought under the hammer but half sold after auction.
• The biggest sale was recorded at 4/23 St Ninians, Brighton (Stewart Lopez of Kay and Burton), which was bought for $4,825,000.
• The biggest pass in was at 29 Sussex, Brighton (Greg Costello, RT Edgar), $3,350,000, no bidders

Agent Q & A: If you were a buyer, how would you buy a house over the next two months, during the Christmas break?
Errol Driver, Hodges, Beaumaris:“Assuming we are buying a residential property in the suburbs (not holiday area along the coast) my impression is that there continues to be a growing list of houses for sale, including a fairly high number of passed in auctions. KNOWLEDGE is the key to the subject! Study the recent price trends in the suburbs you are interested in – put the effort into visiting all the open homes offering the requirements you have & follow auction sales results so you can make an informed decision on the amount you are prepared to offer.Forget asking prices & if you have sold & are cashed up understand your money now has REAL purchasing power that wasn’t there early this year. All sellers have different circumstances which won’t be apparent if selling through a good agent, however be prepared to make the offer at YOUR price, in writing and with no conditions and you could be surprised! Perhaps not bargain basement, but a number of very good buys may exist over the break. Good luck & Season’s Greetings!”

Hampton 25 Bolton: David Hart: 5 bidders: Under the hammer for $2,800,000

Key Points:

The Jekyll of Hyde of real estate – one day it’s OK and the next it’s not. This weekend, under pressure, Bayside was all over the shop. Not really, really bad but even the most optimistic agents would still only give it a bare minimum pass. Even so, with 24 buys over $1million, it wasn’t a complete disaster.

There were 22 auctions over a $million in Brighton alone.

The result was a coin toss – 50/50. Brighton East was poor but Hampton’s Golden Triangle put in some real impressive results

• 25 Bolton Avenue with David Hart of Buxton – $2,800,000. 5 bidders – very strong.
• 43 Margarita,  also David Hart and Mark Earle of Buxton, sold Saturday before Sunday auction for over $2,500,000 – solid
• Vacant land also in Margarita St, Steve Tickell. Sold for over $1,800,000 or north of $2,000 per sqm. 3 bidders.

Biggest Sale and Bidderbizz: Hampton, 25 Bolton, David Hart, Buxton, Under the Hammer, $2,800,000, five bidders, crowd of 100 people
“A fast and furious auction, led by David Hart of Buxton. Bidding was so fast Mr Hart didn’t have time to announce when the property was on the market. Bought under the hammer for $2,800,000 in front of a big crowd of around 100 people.” (Kristen Hatt)

Biggest Pass In: Brighton, 34 Head St, Peter Kennett, Hocking Stuart, Passed In, $2,650,000, 4 bidders
“It took what seemed to be an eternity for auctioneer Peter Kennett to extract every bid he could from the interested parties at this auction, who were all very keen to keep their hands firmly in their pockets. The first bid of $2,400,000 was a good starting base and over the next forty minutes Mr Kennett kept the crowd amused with one liners like ‘The grass grows quicker than your bidding’ and “If you keep smoking like that, it’s going to kill you”, before he finally reached a pass in bid of $2,650,000. A long auction but very entertaining.” (Guy Angwin)

Agent Q & A:

What are stock levels looking like post Melbourne Cup Weekend?

Errol Driver, Hodges, Beaumaris: “After a relatively quiet start to the Spring market, the Beaumaris real estate market is showing a definite improvement with a substantial lift in houses listed for sale during November.  A number of potential sellers are tossing up whether to list now or wait till the new year. Last Jan/Feb was unusually busy and there could be a repeat of this pattern, however, as I mentioned last time, the interest rate environment holds the key to what will happen. My advice to those in a quandary is, list NOW to avoid any pre-xmas activity slowdown and consider buying in the New Year.”

Halli Moore, Buxton, Brighton:”Things are looking pretty good post cup weekend with a reasonable amount of auctions booked for the end of November. I believe that it may  be a late end to Spring with vendors also looking to auction into the first 2 weeks of December as well. (There has) also been reasonable inquiry from people looking to lock in dates for February next year.”

Results:

Brighton, 8 Windermere: A lot of people turned up to do nothing. Passed In on a vendor bid.

Key Points:

• We monitored six auctions across Bayside, with only one selling under the hammer.
• A massive six bidders at 34 Regent St, Brighton East – but no bidders at any of the other auctions we attended.
• Off Market at 19 Victoria, Brighton was bought quietly during the week through Julian Augustini of Hodges for just under $3,000,000
• Counterpoint was again the low stock quality on offer this weekend
  

BidderBuzz Auction of the Day: Brighton East, 39 Regent St, Stewart Lopez, Kay & Burton, Bought Under the Hammer, undisclosed, 6 bidders
“It was cold and the crowd was small – but the action was hot. Six bidders jumped in for this classy block of land and auctioneer Stewart Lopez was rubbing his hands as much in anticipation of the final result as to keep warm. There were still five bidders above $1,800,000 so the final number was market. Well done to the buyer – a good block with a classy shell. Five more bidders still looking for another in Brighton East.” (Kristen Hatt)

Private sales above $3m

• 7 Maysbury Ave, Brighton, David Wilson, JP Dixon, undisclosed

Agent Q & A:

What advice would you give a buyer wanting to purchase a property between now and Melbourne Cup Weekend?
David Hart, Buxton, Brighton:“From a stock point of view in Brighton, buyers will probably have their largest selection of property over the next few weekends. The weekend of the 23rd/24th October in particular, will be a huge auction weekend. I would advise buyers to have a good go at what is out there now, as long as the property suits most of their requirements. The majority of vendors selling now are doing so for genuine reasons, and we don’t expect the traditional late surge of property coming on post Melbourne Cup.”
Sam Paynter, Hodges, Brighton:”The Spring rush from Grand Final to Melbourne Cup is a great time to be in the market. It’s currently a good commercial environment where vendors in general are being pragmatic about price and want to meet the market and sell. With higher volumes of property available it always pays to attend as many auctions as possible for properties that are in your range. Be ready to get involved! Do your home work, have a limit and bid! If you buy a house the hard work will have paid off! Don’t lose heart if the price goes too high! If the property passes in and the price is in your range be prepared to negotiate.”
Robin Parker, RT Edgar, Brighton:”Buying a home to live in, as opposed to an investment, is a huge decision. The endless searching and often the disappointment can shatter even the hardest of characters. Often you will meet buyers  who say ‘’we have just started looking, so we want to look a bit longer before we buy’’…However, “Time and Tide waits for no Man.” [or Woman] If it feels right, do it.”

Land Value
A couple of land value sites in North Brighton – Male and Asling Streets – failed to attract attention at auction. Unlike the Regent, Brighton East sale which puts quality wide and north facing land around $2,000 per square metre

Brighton 75a Cole: Adrian Jones for Open Living: No bids: Passed In $1,450,000

Key Points

• Bidders went very cold on this weekend’s offerings

Biggest sale and only auction we saw with bidders

6 Linacre Rd, Hampton, Mark Earle, Buxton, Bought after $2,350,000, 2 bidders
“A perfect Spring day welcomed this Hampton auction. A crowd of 60, many of whom were neighbours, eagerly awaited the auction with much chatting to be heard. Mark Earle was down to business and the auction was under-way with an opening bid of $1,875,000. The bidding was slow and Mr Earle, despite his best efforts, passed in the property at $2,160,000. Bought after for $2,350,000. A strong result.” (Kate Agnoleto)

Agent Q & A:

October 23 is Super Saturday – What can we expect?

Jason Gill, Hodges, Brighton: “The larger numbers may result in thinner coverage at auctions, but the quality properties will still attract the interest they deserve.”

Michael Cooney, Hodges, Beaumaris: “Saturday the 23^rd will be a great test of buyer confidence on the back of the unexpected mini break in interest rate rise speculation. Best advice for mid and high end property sellers is if you receive an offer in your selling range, don’t hang out, sell and move on. There will be good buying opportunities in late November/December.”

Errol Driver, Hodges, Beaumaris: “Finally, after several months of disruption in the local market with a confused federal election campaign, school holidays and two football grand finals, the sales action is scheduled for 23 October. Anticipated results will be mixed with sensible reserve prices making the difference between success and failure.  Recent auctions have attracted multiple bidders but sales success is noticeably price sensitive and current stable interest rates is a plus, but for how long?”

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:

Brighton 14 Edmanson: The miserable weather made for a challenging auction. Surrounded by an umbrella-laden crowd of 25, David Hart of Buxton forged ahead with determination. The auction commenced with a vendor bid of $950,000 and with no bidders on the day, the property was passed in by Mr Hart at this same figure.

Bayside this week had a clearance rate of 7 from the 11 monitored properties this week – or 63%. This was up on the 40% to 50% of the last few weeks in May, but it was on a smaller turnover.

Bidderman, our demand indicator, was 1.3 bidders per auction – which is still lowish if we are in an improving market.

Having said,  turnover is now getting back to levels each week where we can gauge meaningful levels.

For instance: the 4th week in May 2010 produced 23 reported private, post auction and auction sales in Bayside. This the 4^th week in July we are looking at 14 reported sales – or about 60% of the corresponding week in May. However, overall we are well done on month to date comparable sales; this is seasonally normal and expected.

Agent Comments:

Stephen Tickell of Hocking Stuart: Prices only drop when vendors say so – i.e. when they accept the reduced prices – and that was happening in May. The market made the adjustment and now we are back to, well Mal where we always are every week, supply and demand. Supply is the main guider of the market of the market at present and there is not a lot for buyers in the $1million range in Sandringham and Hampton.

Julian Augustini of Hodges: There are two markets at the moment in Bayside. Median Bayside around $1 million going well. Double Median such as $3.5 million in Brighton and say $2.5 million in Hampton is struggling a little due to minimal demand for what is on offer and there is a reasonable depth of offering. Price is the key here.

Sturt Hinton of Kay and Burton: Good clearing of stock level. It’s been a good two months with quiet sales both private and off market ranging between $2 million and $6.5 million. We are seeing quieter stock numbers coming on now.

Of the 14 reported $M+ sales for the week the highlight was:

23 Murphy St Brighton – James Home Rating 767 out of 1000
James Home Rating: Great street and this property is appealing from the outside. Excellent land content here and a west facing rear is great for afternoon light. Some may have question marks about the floor plan – while the main bedroom suite is very good the separation to other bedrooms is not ideal and the kitchen and stair placement could be better. The cellar is one of the best I have seen and another big plus is a self contained unit at the rear. A good all round family home.

James Auction Report: In cold, drizzly conditions Nick Johnstone of JP Dixon worked hard to bring the bidders out from under their umbrellas. The result was rapid-fire bidding, culminating in a sale price of $3,350,000 in less than 15 minutes. 2 bidders.

James Post Auction Analysis: Strong but not completely unexpected result.

All other reported sales were in the $1m to $2m range.

Land sales

17 Hornby Beaumaris (towards the Black Rock area) with Peter Hickey of Buxton was at $1450 per sq metre for a larger block of land over 900 sq metres.

27 Plantation Ave Brighton East – certainly in Brighton East’s top five streets, again with Nick Johnstone of JP Dixon. 640 sq metres of land achieved $1,326,000 (see our auction report) or just over $2000 per sq metre.

And finishing off with a couple of smart little single level townhouses for the downsizers:

16 Lynch St Brighton (Sabrina Merrick of Hodges) $1,370,000 at auction (see report) for 452 sqm of land or just over $3000 per square metre

The little gem of the week was 16 Collins St Brighton (Chris Carrington of Buxton) – a single level townhouse in need of a reno in central Brighton. It surprisingly sold beforehand for $1,450,000. That was a rare opportunity and well done to whoever bought it.

This coming week we are monitoring 19 auctions.

We only buy homes

23 Murphy St Brighton: Solid result though Nick Johnstone of $3,350,000. See report above. 2 bidders

What is it with redheads? They're running the country - and now they're taking over the auctions. We counted six in this photo in amongst auctioneer Phillip Kingston from Gary Peer. 7A Nightingale St Kilda East. Bought After $1,200,000. 1 bidder.

At 6pm Saturday the James Clearance Rate on the 22 $M+ Auctions we covered was 59%.

Our Demand Indicator Bidderman was 2.2.  Hmmm – an interesting increase but it was off a very low turnover.

Today’s Highlights

1)      Bidders were present at 18 of the 22 auctions we covered –  and at three auctions there were 6+bidders

• 23 Sunburst Avenue Balwyn North (Doug McLauchlan of Marshall White)
• 12 Lennox St Hawthorn (Russell Turner of Christopher Russell)
• 7 Monomeath Avenue Toorak (Justin Long of Marshall White)

2)      The Pies are top of the ladder – and the election is on

We couldn’t find many $M+ auctions worth covering and only one of the auctions we covered went over $2m this weekend. So with the small numbers – just coming out of  the winter hiatus – it was like a first back training run before we get into the winter season proper over the next few weeks.

Agent Quotes

Scott Patterson of Jellis Craig: “Sold 12 from 16 today throughout the company. Opens and auctions were well attended…those who wish to sell in next month or two could enjoy quite solid results due to lack of supply, because demand seems reasonable… August 28 is looming as big weekend, particularly as it is now the week after the election…only thing is that Hawthorn vs Collingwood might affect crowd numbers etc…’

Hamish Tostevin of Marshall White: ”Opens were steady without being over-run with buyers. Certainly a lack of property at the moment in terms of supply. Should be a solid spring, particularly when the election is out of the way.”

Now, where were we before we were so rudely interrupted (by the school holidays)?

It has been a month since we last reported, and we have seen more Top End activity at Tullamarine than in any other suburb. Was it sales? No. It was our selling agent brethren jetting off to Europe to recharge their batteries. This poor humble buyer agent can only give you a travelogue on the Dubbo Zoo so I won’t bore you with tales of kids and a 12-hour car drive or the fact it ain’t a patch on the Werribee Zoo.

The world is a different place since our last report: back then Kevin ’07 was in charge, Masterchef was still a competition to find the best amateur chef in Australia, not the luckiest cook as it is now, and our $M+ market had prices cooling quicker than a Melbourne winter, after a blistering start to the year (although there were still an incredibly high number of buys).

A month ago we reported that the early 2010 gains had evaporated in the five auction weeks of May due to the sheer number of listings. May’s record supply finally stopped what had, since March 2009, been a rising market, driven initially by international buyer demand and then solid local demand.

So what is happening in our Winter Market (June to August) right now?

To be frank we don’t know for sure yet. But here are some of our thoughts.

1. Prices Now
2. Stock Quality Now
3. Method of Sale Now
4. Risk v Reward Now

Prices Now
Selling agents love to use the ‘p’ word plateau (rather than the four letter ‘f’ word)  to reflect on, or deflect away, thoughts of a declining price market. Right now, we actually agree with the ‘p’ word – especially if you accept that prices fell significantly in May and June. (By the way, the ‘f’ word that selling agents don’t like to use is fall.)

Some reasons prices may be plateuaing are:

• Seasonally reduced action (winter)
• An election on the horizon –  so some buyers and would-be sellers will pause to wait for the result.
• We had a big price fall in May and  for most of us market watchers the way forward is still unclear. Will we see more price drops or …. who knows? Like many, we are waiting for a sign.

Demand in Relation to Price

• This weekend Bidderman was at 2.2 – but, please note, this is based on very low auction volumes and therefore statistical distortions are possible.
• As a buying company,  we have had commitments from a significant number of new clients over the past few weeks.
• We feel it’s better to reflect overall demand as more cautious rather than dropping – however another month or two may tell us a different story.
• Right now, buyers still do have the rare luxury of having their cake and eating it too – if they choose to. Prices have fallen in May/June, and in July we are in a market of reasonable choice. Hooray for buyers!

Private Sale Clearance Rate – the number of Proven Sales is only 11 from 50 – or 22% – over the past six weeks.

Six weeks ago we randomly selected a basket of 50 higher end Private Sale and Expression of Interest properties, right across our $M+ Melbourne market. We did this with the aim of  checking  what was bought 6 weeks later (roughly the same time as a “go to whoa” auction campaign), and to therefore calculate the clearance rates  to see how Private Sales and Expressions of Interest were really going.

We thought this snapshot would provide the best reflection of private sale market activity and confirm or question comments by some selling agents that: “Oh yes, auctions were not as good as March, but we are selling a heap via private sale”. The results proved that while in May agents were selling a heap, it wasn’t so much the case in late June to early July. However,  it could have just been that many agents were away.

• We have made an effort to contact those that were withdrawn without a sale price, and we may have missed a few sales – but overall the non-auction homes are NOT running out the door any faster than the auctions. In fact you could make a strong argument that, as an effective method of sale, auctions are still outperforming private sales in many cases – despite the declining clearance rates, given that only 1 in 4 private sale properties have been bought in 6 weeks.
• These figures must surely help smart buyers put together an offering strategy. It’s certainly prompted us here at James Buyer Advocates to change how we buy in the last two months.

Today’s final word on price – are you a glass half empty of half full person?

If you feel the double-dip recession is fast approaching and the world as we knew it is about to end, then, by all means, don’t buy – and in fact sell (and please give us a ring if you have a good home to sell).

If you feel Julia (Gillard) won’t be changing the legitimate immigration numbers any time soon (demand) and Justin (Madden) won’t be able to release large numbers of housing blocks in Inner Melbourne because they are not there (supply), you may wish to ignore the doomsayers and take advantage of this current price breather combined with good stock offering. The GFC lasted less than a year  (for us) and in July 2010 Melbourne $M+ home prices are still 20 to 30 per cent above 2008 GFC home prices. Remember the 2008 ‘bulls**t’ rumour of the year, which said the NAB and other banks were about to foreclose on 200 homes in Toorak alone – it never happened. Yes we are biased and make a living by encouraging buyers to buy – but the facts are still very positive for buyers.

Stock Quality Going Forward
Spring quality and auction numbers are the variables we don’t have a clear handle on as yet. Right here and now in July, we have a market with excellent stock numbers for buyers – if you know where to look and you actually act correctly (please see the following paragraph on methods of sale). We also think the quality is good. Going forward, quality stock levels are not clear to us, because traditionally when quality sellers see a declining market they are loathe to put their home on the market on a speculative basis (in that, if they don’t have to sell, they won’t). This obviously leads to less stock on the market, which may affect price but, more importantly, it affects choice. Good buying decisions are more likely when, along with good advice, you, the buyer, have good choice.  You have that now.

Method of Sale
As we said, there is choice now if you know where to look, whom to ask and how to deal. Look at the above private sale table – there are some good homes there. We keep overhang lists (stales and unsolds) and there are also a number of off-markets and quiet pre-releases available. Granted, some of the vendors are still in their price cocoons but  quality sellers who have adjusted their price expectations may have homes worth considering. The off-market (unadvertised properties) may well be the market of choice for a number of buyers and sellers in the next few months.  But, please note buyers, you will have to sharpen your negotiation strategies to take advantage of all that is on offer.

Risk v Reward
To digress – Risk v Reward is where Masterchef’s Adam and Claire had it all over Jono. While Jono was going for the big dish on every occasion – and you have to admire him for that – he wasn’t playing the game to the best of his abilities. Adam is the quiet master at the Masterchef game. He sees a situation and says: “Yeah, I want to try and make a dish that will impress the judges and maybe get me a shot at immunity – the reward – but I don’t want to push the boundaries that far that I risk getting in the elimination round if I fail.” Good Home Buying and Negotiation is absolutely the same as this. Why is that? Because in the first instance the strategy should be to get yourself into a strong position and not risk all for the pot of gold. Once you are in that strong position, then you can make a run for the prize. Another analogy is acclimatising at base camp before you make the assault on the Everest summit. This is Risk v Reward.

A full James Buyer Opinion on Risk v Reward in today’s Market will be published here on Tuesday – so look out for it this week. At the moment you will find our biggest ever ‘clicked on’ James Buyer Opinion article – The Learning Fee - right next to this article.

It’s good to be back

We Only Buy Homes

Mal

Balwyn North 23 Sunburst. Big Crowd for Doug McLauchlan of Marshall White - 125 in fact. Seven bidders. Bought under the hammer for $1,567,000.

Bidders were a bit cold, a bit wet and not in the buying mood at 15 Kirkwood Sandringham. Passed In. One bidder. (Nick Johnstone, JP Dixon)

A bit of gloom maybe an understatement.  We covered 10 properties auctioned in Bayside today over $1,000,000 and saw a clearance rate of  zer0!  That’s right, nothing was bought under the hammer today.   6 bidders in total, and Park Road, Sandringham had two of them.   That’s Bidderman at 0.6. 

Properties to pass in today on vendor bids  included 3 Wellington , Brighton at $4,000,000, 5 Avondale, Hampton at $1,650,000, 66 Littlewood, Hampton at $1,220,000, 42 Holyrood, Hampton at $1,820,000, 15 Kirkwood, Sandringham at $2,400,000. (See live video of this auction on the  Market News home page).

Some of the bought properties include 28 Keats Street, Sandringham which Jenny Dwyer and auctioneer, Stephen Tickell, at Hocking Stuart bought post auction for  $100,000 above the pass-in price, for $1,650,000.   326 Beach Road, Black Rock (Mark Earle, Buxtons) was bought today for $2,450,000 and 5 Rippon Grove, Brighton which Justin Follett of Kay & Burton sold mid-week  around $3,500,000 after initially passing in at auction.

Speaking with Gail Pullen of Kay & Burton today, she thought the number of buyers around for this time of year was exceptional, but so were the number of properties currently for sale – perhaps evenly matched, and although properties may not be selling at auction, transactions were still happening.  This supports our view that alternative methods of sale in the $2,000,000 plus market will continue to increase over the next few months.

Leigh Hallamore of Buxtons still believes that the auction system brings price to a head and that vendors should consider the price at the time of auction as it may not be present when they come to the realisation that they should have taken it on the day.  He added that vendors need to recalibrate on price to comfortable levels and that some current prices are in no-man’s land whilst the market is in transition.

Clearance Rates Bayside – 35 monitored – 14 bought – 40% (last week 46%)

Expressions of Interest
Kay and Burton are the masters of this form of selling and with the current market and clearance rates it is as expected coming back into vogue. Four interesting homes that Mal has been through recently and rated highly are

• 9 Martin St Brighton (Gail Pullen and Ian Jackson) north facing golden mile land with an art deco maybe.
• 3/9 Glyndon Brighton (Alex Schiavo and Stewart Lopez) – golden mile apartment in the traditional style
• 2a Seacombe Grove (Sturt Hinton) – left field golden mile townhouse  worth a look
• 31 Martin St Brighton (Sturt Hinton and Stewart Lopez) – really good home in that Elwoody North Brighton, Beachy precinct.

Miriam Carraro of Hodges and one of Brighton’s quiet achievers says this about EOI’s. There is an increase in EOI as it suits vendors who would like to sell privately but wish to have an end date to the process (which auctions give you): the vendors selling through EOI can get the best of both worlds using this method. 

If as a buyer, you would like to know more about how to work your way through the EOI method of sale, please give us a ring.

Happy Wife Happy Life

Indoor Auctions were the order of the day. Stephen Tickell and Jenny Dwyer pass in and sell after for $1,650,000. 1 bidder.

One of the nice guys; nonetheless a man on a mission. Mission Accomplished for Bill Jowett of Buxton. Black Rock 63 First: Bought After $1,610,000: 1 bidder

Eight bought at auction and 12 passed in (10 on a vendor bid) – that’s a James $Million+ clearance rate of 40%. Having said that, 7 $M+ homes were sold mid-week in Bayside so the market isn’t in hibernation.

As more $3M+ auctions fail and vendors ask the question `why spend $30,000 on a failed auction marketing campaign ?’, you will begin to see more and more Expressions of Interest. Expressions of Interest and Off Market sales are increasing with JP Dixon and Kay and Burton. Two more $4M+ auctions that failed to fire today are 19 Wellington and 23 St Ninians.

Buyer behaviour  appears to have changed in the past month.  This may be due to increased stock levels providing more choice for buyers and/or buyer’s becoming more discerning.  However, according to our research, there have still been 57 sales over $1,000,000 in Bayside this month.  That’s over 2.5 sales per day!

Some interesting issues:

1. The bought afters on the day are now a big part of current Bayside auction life. Auctioneer, Bill Jowett of Buxtons has since sold 63 First Street, Black Rock  for $1,610,000,  Mark Earle of Buxtons sold 148 Thomas Street, Hampton after auction for $1,570,000, 11 Passchendaele, Hampton with Julian Augustini of Hodges sold after for $1,290,000,  Errol Driver of Hodges sold 7 Hilton Street, Beaumaris after for  $1,385,000.  Julian Augustini of Hodges auctioned 6 Higinbotham Street, Brighton.  A genuine bid of $1,650,0oo (not accepted)  was followed by another  vendor bid and passed in.  The property has since sold for $1,800,000.
2. Not all sold afters have big jumps in price.
   7 Hilton Beaumaris – $5,000
   63 First St Black Rock – $100,000
   148 Thomes St Hampton – $34,500
   11 Passchendaele Hampton – $90,000
3. No auctions over 2 bidders today and Bidderman was a lowly 1.2.
4. 125 Male St Brighton resold yesterday with 2 strong bidders (Lambros Bollas of Buxton) for 1,275,000. Last sold in August 2007 for $1,005,000 so that’s only about a 6% return pa after stamps. Better than many shares – but ….

If you don’t know how to play the Expressions of Interest game then you may well learn at your peril.  Perhaps give us a ring for some insights.

Happy Wife Happy Life

Another Pass In with a really good crowd (100): 19 Wellington Brighton: Kay and Burton Pass In $4,210,000: 1 bidder

Hampton: 28 Amiens Street: Auctioneer Peter Kennett working on his beard. Hmmmm. Bought post auction north of $2,375,000. Bidderman 1.

Discussions this week with Robin Parker of RT Edgar Real Estate included the  firm’s initiative to disclose the reserve price at the commencement of the campaign of 12 Cowper Street, Brighton. Throughout the campaign,  Rowan Thompson (the auctioneer), advised prospective buyers that property would be on the market at $1,425,000.   Buyers were informed and it paid off.  Mr Thompson successfully auctioned the property, with 4 bidders and almost 50 bids, to successfully sell the property for $1,641,000.  Their forward thinking to disclose the reserve price to buyers from the commencement of the campaign, not only encouraged people to bid, it advised prospective buyers that if they did bid at that level and they were the last one standing, they would buy it.  On a day where pass-in numbers were higher than we are currently used to seeing, this strategy worked and it worked well.  Declared Reserves  a winner for both buyers and sellers.

Still on land sites or major renovations, the potential new home site at 76 Carpenter Street, Brighton, auctioned by Campbell Cooney of Hodges, saw 4 bidders again draw the price to a close at $2,220,00.   A strong result with the property calculated at a little over $2,600 sqm.   The large land sale further south, however, at 5 Rippon Grove, Brighton remains unsold passing in at $3,252,000.  There were still 3 bidders  on that property, and given it’s location, is sure to sell soon.  Another with 3 bidders,  also passing in, was 9 Jillian Avenue, Highett. Lack of bidders was not the problem on all properties.  Perhaps some vendor expectations are still rising when the market is not.  Of the 10 Bayside properties we covered, 7 passed in, one sold prior and two under the hammer.  There were bidders on all but two 65 North Road, Brighton – well sized home on low maintenance block and 35 Reid Street, Beaumaris a large family home in a great location.  Others passing in with one bid apiece were 17 Connor Street, Brighton East and 4 Smith Street, Hampton.   However, Jenny Dwyer of Hocking Stuart, again showed her skills, successfully negotiating the sale of 28 Amiens, Hampton.  A great family home in the Castlefield Estate, initially passing in for $2,275,000, eventually selling north of $2,375,000.

Another result from an expressions of interest campaign for Ross Savas and Stewart Lopez of Kay & Burton, selling a block of land in Mulgoa Street on Brighton’s Golden Mile,  for more than $4,000,000.

Definitely poor selling results this week.!  Were they due to the upheaval seen on the stock market on Friday, the quality of property, the Vendor expectation or reduced buyer interest.  Bidder man was still at 1.8 on the 10 properties we covered.  Perhaps the next few weeks will tell.

Happy Wife Happy Life

Brighton East: 17 Connor: Leigh Hallamore passes into a lone phone bidder at $2,125,000