There are enough quality stats out there to show that this year so far has been a great one for buyers. And it could become even more so, given the good post Easter stock levels and prices already around 10% lower than early last year.

But winter in 2011 is also bringing a certain level of uncertainty in the Melbourne property market. Will prices continue to fall lightly as they have been, or will we see an even bigger negative correction than is currently taking place? Could market prices rebound, led by healthy pockets of underlying unsatisfied demand once the May rush is over?

We just don’t know for sure. And uncertainty is something that home buyers don’t like. Sure they know there are opportunities, but there’s also fear.

It’s a bit like jumping off the Brighton Pier in winter, when it’s cold and you can’t see the bottom. You want to jump in because you know it’ll be a great achievement when you do, but you know it could also involve a certain degree of pain and also a fear of the unknown.

Fear of the unknown, of not being able to see the bottom, is an understandable, instinctive, emotional response.

Uncertainty can also be financially stressful, because of fear that you may be putting yourself into an elevated risk position. You might be buying a home that could be worth less next year than it is today.

But is that a risk that should put you off buying a property?

If you are buying a home to live in for say the next ten years, and history repeats itself, as it tends to do, and prices go up and down during that period, then buying in a “down” part of the cycle is no more risky than buying in the “up” part of the cycle.

Even if you are a short term buyer, is it any riskier to buy now when prices are lower, than it was a year ago? Not necessarily.

In fact, given that the top of the market was Anzac Day 2010, if you were a short term buyer and bought then with the plan to sell on Anzac Day 2012, then logically Anzac Day 2010 was a riskier time to buy than Anzac Day 2011.

If you’re a long term holder, it was even less financially risky to buy this Anzac Day than Anzac Day 2010.  Yet many more buyers were happy to buy in 2010 than 2011, as we can see from the sales volume stats.

The fact is that buying in a falling market doesn’t necessarily result in an elevated risk position.

Maybe if you are the kind of person who cannot stomach your home being worth less now in the eyes of the market than what you paid for it, then perhaps now is not the time to buy. The time for you to buy was at the start of a long term bull market, say Anzac Day 1999. (The trouble is that I was buying in that market and I didn’t know (for sure) that it was the start of a long term bull market and reading the press at the time neither did anybody else.)

And perhaps if you are a heavy borrower who is fully stretched you may have an elevated risk position if your lender makes a call. But how many actual forced sales occurred during a far worse decline in prices in Anzac Day 2008 during the time of the GFC?  Sure there were plenty of scary headlines, but few foreclosures.  And why? The fact is that it is rarely in the banks’ interest to foreclose in a falling market. They may get a lower price for the asset too, don’t forget.

Returning to jumping off the pier where you can’t see the bottom: you can survive and experience the pleasure if you take few precautions:  learn to swim , get some expert help and maybe have a back-up life buoy if you get into trouble.

Overall this market is better than a year ago to buy in. Will it be better than next year?  We can’t possibly know for sure. But buying now is not necessarily an elevated risk position. In fact you can further reduce those risks with some careful thought.

Mal James

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

BRIGHTON, 4 Iona Ave: A very dapper Peter Kennett (Hocking Stuart) basks in the autumn sun and sells the property under the hammer for $1,256,000, 2 bidders

Are we in for some Super Saturdays at the end of this month?

Jenny Dwyer, Hocking Stuart (Sandringham): “The market for the foreseeable future would suggest that a more balanced supply line is occurring at present – the days of “Super Saturday” may have come to an end until the Spring market appears for 2011 (unless we are in for an unexpected surprise!).  Stock levels are at a more sensible level with some owners considering private sale as a viable alternative hence lessening the likelihood of another 1000 plus auctions on the last Saturday of May.”

A few smiles were found on Saturday and here was one of them. David Hart (Buxton) with friend at 48 Regent St, Brighton East. Passed in $1,275,000, 1 bidder

At 6pm on Saturday, the James Clearance Rate for $M+ properties in Melbourne was 55% on the 29 auctions we attended. We covered around half the $M+ auctions this weekend. May is looking very lean for auctions and today was almost a non event auction wise

The Weekly Review Bidderman, our demand indicator, was 1.2 bidders per auction. Considering the low numbers on offer at auction this was not a good sign for sellers going forward.

The Perils of Emotional Bidding
The big auction issue for me this weekend was how bidders were bidding. I went to three auctions with a total of  nine bidders and saw some very surprising and costly bidding.

One example was the auction at 48 Emo Road, Malvern East. This is a lovely little single fronted in one of my favourite family and investment areas, the Ardrie Park precinct in Malvern East. Middle of the road quality, not bad for those just starting out in the home ownership stakes – plenty of space inside and outside and good flow. Good feel.

Anyway the auction is about to start and a nice healthy crowd of around 100 has gathered to hear the pearls from a not-so-old stager who rarely auctions these days – Peter Bennison.

Peter calls for an opening bid, to which one very enthusiastic bidder responds with a strong and emotional bid of $950,000. With repeated calls for further $10,000 rises unsuccessful, Peter takes a strategic half time break. On returning, he unsurprisingly declares that the property will be passed-in to the lone bidder if no further bidding. After a second bidder pipes in offering that elusive $10,000 rise, the original bidder responds emotionally and strongly with a crowd hushing $1,000,000. Perhaps the bidder should have asked the “Is it on the market?” question – because this was well above the original quote of $890,000 to $950,000.

What it also means is that the auction will now be completed behind closed doors with some argy bargy instead of cleanly in the street and under the hammer, which a good question could have allowed. The final result of $1,150,000 is decided inside a few minutes later. Wow! I know the buyer saved the fee of getting professional help and normally I am against such flexible post auction reserves but really if a  buyer wants to pay then they should be allowed to – it’s a free country. For the very experienced Mr Bennison this bidder was a gift, and he knew exactly how to work this  situation to the benefit of his client, the vendor (low quality agents may not have recognized the opportunity presented).

There are a couple of things that come from this as lessons to first home buyers and DIYers:

1) As a bidder, by all means look strong to ward off other nervous buyers. But it doesn’t help to look emotional – an experienced agent will pick up on that and it will cost you money

2) In this market you have to test every step of the way. Ask questions. There was nothing wrong with the opening bid but the winning bidder’s second bid could and in fact should have been presented in a very different way. Because it wasn’t, the post auction problems snowballed from this one decision.

3) In this market, on a $890,000 to $950,000 quote, and with no proven competition above $960,000 why would you be rushing up the pole to an incredible $1,150,000? If you have to pay it then at least take a few hours of testing to get there.

There’s no doubt that it’s a good home and I certainly would have recommended buying it. And maybe the result would have been no different if a professional was managing the buying side. But I think a number of safety procedures could have been implemented prior to agreeing to that amount.

There were further interesting results along these lines at the auctions at 13 Maskell St Brighton (Peter Kennett) and 7 McClaughlin Sandringham (Mark Earle). Please see today’s auction reports for more details.

Now back to the market – Future Stock:

Auctions – May is going to be very quiet compared to May 2010, when we witnessed well in excess of 1000 $M+ sales across Melbourne. Melbourne’s Inner East and Bayside represent a majority of  Melbourne’s Million Dollar Plus sales, and predicted auction numbers in these areas for the four weeks in May are as follows: this past weekend 45, next week 43, and the last two weeks in May, 105 and 106. Even though there were five Saturdays in May 2010, there would need to be an incredible number of private sales this year to get the final numbers of solds anywhere near last year, and that is not likely to happen with the current market mood.

Off Markets – According to agents there is a strong trend towards private and off-market sales. Nick Johnstone, of JP Dixon (Brighton) says: “We are seeing a definite swing towards private and off market sales which shows a transitional phase in the market.” 

Other agent comments:

David Oster, Jellis Craig (Ivanhoe): “The 28^th May will be a Strong Saturday. It is the last clear Saturday before School holidays.”

Richard Winneke, Jellis Craig (Hawthorn): “May 21, May 28 & June 4 are 3 bigger Saturdays and then many owners will hold off selling until August.”

Melbourne Wide April Wash Up :
Volume -  Has a lot changed in Million Dollar Melbourne between April 2010 and April 2011? Well, yes and no. April 2010 had around the same number of REIV reported $1m+ sales (there may be a 10% variance with the chance of late reported April 2011 sales to bring the April 2010 and April 2011 numbers closer together) but on a count of over 500 buy/sells, not much has changed in terms of volume.

However, even though the last market turned in April 2010, May 2010 was a boom month with well over 1000 REIV reported $m+ sales throughout greater Melbourne. Therefore May 2011 will be watched to see if it can get anywhere near those sorts of numbers, however we don’t think that will happen. We are still seeing a $M+ home bought every ninety (90) minutes somewhere in Melbourne and that was with Easter taking up a fair bit of the month.

Let’s look at a couple of suburbs which we randomly selected to give a spread of Greater Melbourne $M+ reported sales for the month of April 2011 compared to April 2010.

Price – In our opinion, backed up by REIV Median price results, we feel prices are definitely flat or falling and have been for the most part of this year and a lot of last year. When we say flat or falling we don’t mean plummeting – we mean a drop by as much as 10% over the last 12 months. However we are still seeing plenty of instances of the old property truism: If it is well located and has some WOW and the right price to attract multiple bidders then it is still possible for the ultimate buyer to be paying more than you would have expected last year.

Winter is upon us and buyers and sellers alike appear in a less enthusiastic mood than even a few weeks ago. Even so, we have bought more $1M+ homes this year to date than this time last year at the same time.  And why wouldn’t you buy now, unless you know something we don’t? Price and choices have been considerably better than last year.

$3M+ Market Report:
Back from a week or two off, this market now, has a fairly clear run till Christmas, with a only brief breaks for a couple of holiday weekends.

A couple of strong results today:

• Elwood 18 Normanby (Paul Sutherland) – Bought for $3,375,000, 4 bidders – see our video auction
• Camberwell 26 Alma (Alastair Craig) – Bought After – $Over $3,000,000 at asking – no bidders – there is that strange bidding thing again

Over the next four to six weeks we should see more choice and some reasonable activity (although not expected anywhere near the levels of last year), as the May market is a traditional agent preferred selling time. Why? Well there is a good stretch of time until Queens Birthday weekend to run an uninterrupted campaign. Stock Quality is the unknown.

Come July things will be relatively quiet as there is a general sellers’ feeling (rightly or wrongly) that good homes do not look their best at this time of the year and accordingly a number of high end selling agents take winter holidays in Europe and therefore do not program campaigns to be run in their absence.

In the post Easter week or so there have been ten or more high end sales including the representative  half dozen below

• 15 St Ninians in Brighton for between $8m and $9m – perhaps not a lot more than what is was sold for less than 2 years ago (need to look up sale time to be absolutely sure of date) – Justin Follett of Kay and Burton
• 255 New Brighton for between $5.5m and $6m – Regina Schmidt and Brian Devlin of Buxton
• 50 Hotham St East Melbourne which had been on the market for at least 6 months for $7million – Paul Richards of Hocking Stuart – on the market for a fair bit of last year and also a failed auction. Nonetheless a reasonable price – not everything the sellers wanted – but more than had been offered at times in the past by buyers. A good result for both parties.
• 150 Clarendon East Melbourne – the Salta apartments saw Anton Wongtrakun deliver another big sale at $5,200,000 for Unit No 4
• Out to the paddocks of Lower Plenty with a Marketnews favourite Rocco Montanaro of Morrison Kleemand who achieved close to $3m on an Expressions of Interest Campaign for a good home on 7 acres at 75 Cleveland.
• And we round up our selection of high end Easter Sales with a $6M+ sale at Mount Eliza 15 Freemans Road – Michelle Skoglund of Aqua

In summary over Easter the market at this level has not been dead, but definitely subdued – there is increasingly a dampening mood in terms of both buyer and seller confidence. Time will tell if this is a short or longer term phenomenon. Price will play a important part going forward as we seemingly move into more uncertain market conditions – i.e. ones that are not as clear as they have been in the past 2 years since we awoke from the GFC. Overall the market now and in fact all of 2011 has not been strong at the $3m+ level – but there are still enough transactions (especially in Bayside) of sufficient value to avoid holding a wake just yet.

With winter approaching and a fair amount of stock available we think it is a buyers’ market and the future is best described as – “uncertain times”.

Finishing on a positive note our James Investment Division has seen some solid interest with investors coming back into the market (rentals are improving) and one current flavor of the times is blocks of flats. Some examples of what we are talking about.

The Big Issue: Klarity Kris and Architect Adam discuss the big issue of the week – does this market, with prices currently dropping, have elevated risks for buyers ? See what the two have to say by clicking on the live action.

Auction Video: This week Cafe Guy heads to Elwood on what was a big auction day for the Port Phillip area. Watch  the auction video of  18 Normandy Rd (Sutherland Farrelly) by clicking on the live action.

Buyer Masterclass: Double-fronter or two storey, single-fronted cottage? Architect Adam explores this dilemma in this week’s Buyer Masterclass. It’s a great article check it out!

We Only Buy Homes and Happy Mothers Day Mum and in fact to all Mums – we love you all!

“No way mate - this market is fighting back– taking no prisoners today (April 9th).” John Bongiorno. Malvern 54 Stanhope. Bought $3,170,000. 3 bidders.

Week Ending 30th April: Back from a week or two off, this market now, has a fairly clear run till Christmas, with a only brief breaks for a couple of holiday weekends.

Over the next four to six weeks we should see more choice and some reasonable activity (although not expected anywhere near the levels of last year), as the May market is a traditional agent preferred selling time. Why? Well there is a good stretch of time until Queens Birthday weekend to run an uninterrupted campaign. Stock Quality is the unknown.

Come July things will be relatively quiet as there is a general sellers’ feeling (rightly or wrongly) that good homes do not look their best at this time of the year and accordingly a number of high end selling agents take winter holidays in Europe and therefore do not program campaigns to be run in their absence.

In the post Easter week or so there have been ten or more high end sales including the representative  half dozen below

• 15 St Ninians in Brighton for between $8m and $9m – perhaps not a lot more than what is was sold for less than 2 years ago (need to look up sale time to be absolutely sure of date) – Justin Follett of Kay and Burton
• 255 New Brighton for between $5.5m and $6m – Regina Schmidt and Brian Devlin of Buxton
• 50 Hotham St East Melbourne which had been on the market for at least 6 months for $7million – Paul Richards of Hocking Stuart – on the market for a fair bit of last year and also a failed auction. Nonetheless a reasonable price – not everything the sellers wanted – but more than had been offered at times in the past by buyers. A good result for both parties.
• 150 Clarendon East Melbourne – the Salta apartments saw Anton Wongtrakun deliver another big sale at $5,200,000 for Unit No 4
• Out to the paddocks of Lower Plenty with a Marketnews favourite Rocco Montanaro of Morrison Kleemand who achieved close to $3m on an Expressions of Interest Campaign for a good home on 7 acres at 75 Cleveland.
• And we round up our selection of high end Easter Sales with a $6M+ sale at Mount Eliza 15 Freemans Road – Michelle Skoglund of Aqua

In summary over Easter the market at this level has not been dead, but definitely subdued – there is increasingly a dampening mood in terms of both buyer and seller confidence. Time will tell if this is a short or longer term phenomenon. Price will play a important part going forward as we seemingly move into more uncertain market conditions – i.e. ones that are not as clear as they have been in the past 2 years since we awoke from the GFC. Overall the market now and in fact all of 2011 has not been strong at the $3m+ level – but there are still enough transactions (especially in Bayside) of sufficient value to avoid holding a wake just yet.

With winter approaching and a fair amount of stock available we think it is a buyers’ market and the future is best described as – “uncertain times”.

Finishing on a positive note our James Investment Division has seen some solid interest with investors coming back into the market (rentals are improving) and one current flavor of the times is blocks of flats. Some examples of what we are talking about.

Finishing on a positive note our Investment Division has seen some solid interest with investors coming back into the market (improving rentals as well) and one current flavor of the times is blocks of flats. Some examples of what we are talking about.

Week Ending 16th April:The $3m action this week was away from auctions.

The drought in the Balwyn Formula – big price, small land, new home – was broken again with Maurice Di Marzio getting 59 Hosken Street, Balwyn North away in the high $3 millions. That’s the third in a week on the back of the two biggies reported last weekend.

Canterbury, 11 Chaucer Close, with Boroondara doyen Peter Mitchell of Marshall White, got the same sort of high $3 millions price.

Hawthorn, Harcourt St, was a hot place to be this week with Nick Ptak getting 79a away for just under $3.4 million (we think) and one of the results of recent times. Peter Vigano of Jellis Craig  got $3.625 million for 42 (we did not see that price coming)

Speaking of good results, Marcus Chiminello got a price in the high $3 millions for 2/264 Walsh St, South Yarra. It’s not our job to talk agents up but in a slow apartment market Marcus has got a number of solid results.

St Kilda West, 10 Loch St, with John Holdsworth sold for $3,650,000.

Andrew McMillan from Benmac got 367 Beaconsfield St, Kilda West away in the $4m to $5m range after a very lengthy campaign (probably due to previous asking prices).

At Auction today 68 Hopetoun Rd,  Toorak with Jellis Craig’s Steve Abbott, sold afterwards for $3.05 million. That was up a few hundred thousand dollars on the last time it sold around a year ago.

Week Ending 9th April: The strongest week this year for the $3m+ Top End market:

South Yarra 43 Marne St: Nicole Gleeson of Kay and Burton: Well over the $12,000,000 quote range making Domain Precinct land values at $8,000 per sqm for the bigger blocks.

Hawthorn 51 Berkeley St with Tim Blackett also of Kay and Burton: North of $7,000,000 on Scotch Hill for a good home that needs some reworking and a tennis court.

While still in Hawthorn Mr Nice Guy and Very Effective Tim Picken of Jellis Craig got away the quinella with 25 Mary St (Modern in Grace Park) being bought for a credible $4,300,000 and 1 Hilda (period in Grace Park) for $2,800,000. Both a little down on ambitious asks but nonetheless solid prices for what they were.

But wait there’s more and was it us who cried out the death of the Balwyn formula- new build, small block, overpriced. Well on a technicality were are still credible as it’s neighbouring Kew; but with 21 Macartney (Walter Dodich of Marshall White) and 5 Mawson (Peter Dixon of Jellis Craig) both selling at auction today for $4 million’ish, the death of this market maybe a little exaggerated. However please it is only two sales, but they were biggies.

The news doesn’t stop for sellers there with period home successes at 50 Wattle Valley Canterbury (Duane Wolowiec and James Tostevin) selling under the hammer for a strong $3,465,000; 54 Stanhope Malvern with Rae Tomlinson also under the hammer for $3,170,000 and 13 Rubens Grove Canterbury with Fletcher’s Jeremy Desmier bought before for over $3,000,000.

Bayside has recorded a few strong sales as well 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 over $3,200 per sq metre. That is a steady as she goes price similar to last year Golden mile (no view) buys. And another $3m+ sale with a strange twist (all non bidders asked to leave) at 40 Drake Brighton (Ian Jackson).

While on land sales 1073 Malvern Road Toorak (Justin Long) passed in at $3,225,000 and a reserve was offered – not taken up – two new bidders appeared and a second auction took place resulting in a sale well over the pass in figure.

Why all this activity? Pass-ins are still languishing in large numbers without much interest. However its all about quality and new stock and buyer confidence. All three things happened this week -

1. buyers felt better in themselves (confidence);
2. buyers felt this week had some real quality offerings (quality)
3. and buyers couldn’t see a lot of stock coming one (limited new stock)

Post Easter is no Buyer lay down misere after today’s results.

BRIGHTON EAST, 6 Northern Ave: Leigh Hallamore (Buxton) gets the ball rolling and finds two bidders in the crowd. Bought under the hammer for $1,290,000

Quiet day for us all this weekend at the million dollar level. Has been a great year for buyers so far, long may it continue. Have a safe and happy Easter and enjoy the time with your family – Kristen.

John Clarkson, Hocking Stuart, Brighton: “Certainly buyers will not feel as dominant post Easter due to stock levels decreasing to a normal level. There has been a fair bit of choice in the first quarter for the market post Christmas. That rush or backlog has disappeared as a result of being sold or withdrawn from the market. There will be a fair balance post Easter. For all the dooms-dayers who are waiting for the market to fall in a hole, they will be disappointed. Bayside sellers can have confidence that as long as schools, Church St shopping, transport and the beach don’t disappear, there will always be demand. For local buyers waiting for a good time to buy competition will continue to come from the leafy suburbs of Albert Park, Middle Park and Elwood. The infrastructure, amenities and family lifestyle will continue to keep demand at a very healthy level for Bayside. Whilst I don’t see a huge spike in prices if buyers see a property that is 7 out of 10, they should consider it very closely. If they are waiting for the market to implode they may regret sitting on their hands!”

“Oh Yeah Sure Buddy - you are joking, aren't you?” Sold for an undisclosed amount, $500,000 over reserve. 4 bidders. Ivanhoe East 32 Warncliffe. David Oster.

At 6pm on Saturday the James Clearance rate for $M+ was 71% on the 34 auctions we attended. WOW – 71%, a big change from last month.

Bidderman, our demand indicator of bidders per auction, was at 1.8. So on our biggest $M+ auction weekend so far this year, when you would expect buyers to thin out and Bidderman to drop, it actually went up on the trend of the last few weeks.

It may be just one day but it was strong out there this weekend. For the first time since late February our advocates reported feeling feeling genuine price pressures whilst bidding.

Market Summary: The big question is whether this is a statistical blip or whether we are a seeing the trend return towards a balanced market. If so, why?

1. Buyers feel a little better than they did last month and confidence came back into the market as a result. Our enquiry rates are certainly up.
2. The overall quality of homes on offer was up on previous weeks and they were plentiful in number. We saw lots of 700+ James Home Rating (quality) homes go to auction this weekend.
3. Last week as buyers looked into the future they saw that the cupboard of  post Easter offerings was bare – and so they adjusted their game plan accordingly.

Whether this is a blip or a trend change will largely be determined by what discretionary sellers do in May. If they are encouraged by this weekend’s results to put their properties onto the market, then prices may stay softer than last year. If those sellers stay out and demand continues as is, then the overhang of stales will begin to be mopped up and the good buying conditions of the last months (price and choice) will dissipate.

This weekend, again, we saw the overall power of the Melbourne market and the power of demand and supply. There is an underlying strength in Melbourne homebuying (based in immigration and lack of homes), that has slackened off in recent times as buyers become more circumspect with concerns about overseas events, jobs, and who knows what exactly. As well there has been plenty of choice. BUT as soon as there is a hint of a quality stock shortage the market responds, particularly with regards to well-located quality family homes, on land and of a period flavour. And it responds strongly.

More insights

• It wasn’t just the consistent $1m to $1.5m range holding up its end in isolation, this was also the strongest single week this year for $3m+ buys.
• It was the second strongest clearance rate of the year, despite an almost Super Saturday (140 $M+ Auctions – Inner East and Bayside)
• We saw consistent bidding across the board, with over 75% of monitored auctions having at least one bidder.
• The big question going forward after our Easter market break is whether nervous sellers will re-enter the market on one week’s good showing.
• Prices are generally down on this time last year (there are exceptions), so good homes are attractive right now. And while new choice may become limited,  some existing choice (overhang) still remains.
• Top End rentals are getting considerably more rent than expected as supply in relation to demand is tightening. This observation from two agents needs more examination at a later date. We’re interested in how widespread this may be, why it is happening and what effects it may have on the buying market. (Are borderline investors perhaps re-entering the Top End?).

Wild and Wooly - the weather that is, not Rob Vickers-Willis. Toorak 3 Denham. Passed In $2,010,000. 2 bidders.

The $3m+ Market’s strongest 2011 week so far (some examples):

South Yarra 43 Marne St: Nicole Gleeson of Kay and Burton: Bought well over the $12,000,000 quote range, putting Domain Precinct land values at $8,000 per sqm for the bigger blocks.

Hawthorn 51 Berkeley St with Tim Blackett also of Kay and Burton: Over $7,000,000 on Scotch Hill for a good home with tennis court that needs some floor plan reworking.

While still in Hawthorn, Mr Nice Guy and the Very Effective Tim Picken of Jellis Craig got away the quinella with 25 Mary St (modern home in Grace Park) being bought for a credible $4,300,000 and 1 Hilda (period home in Grace Park) for $2,800,000. Both prices were a little down on ambitious asks but they were nonetheless solid prices for what they were.

Kew – Was it us who cried out the death of the Balwyn formula – i.e. new build, small block and overpriced? Well technically we are still credible, because these were in neighbouring Kew: with 21 Macartney (Walter Dodich of Marshall White) and 5 Mawson (Peter Dixon of Jellis Craig) both selling at auction today for $4 million-ish, the death of this market may be a little exaggerated. It was only two sales, but they were biggies.

Malvern and Canterbury -  50 Wattle Valley, Canterbury (Duane Wolowiec and James Tostevin) sold under the hammer for a strong $3,465,000; 54 Stanhope Malvern with Rae Tomlinson also under the hammer for $3,170,000 and 13 Rubens Grove Canterbury with Fletcher’s Jeremy Desmier bought before for over $3,000,000.

Bayside has recorded a few $3M+ sales as well, with 29 Bay Street, Brighton (Bert Stewart of Buxton) selling post auction over $3,550,000. The final result put north-facing Golden Mile land (no view) at more than $3,200 per sq metre. That is a “steady as she goes price” similar to last year’s Golden mile (no view) buys. Another $3m+ sale with a strange twist (all non bidders asked to leave auction) was at 40 Drake Brighton (Ian Jackson of Kay and Burton).

Toorak While on land sales, 1073 Malvern Road (Justin Long) passed in at $3,225,000 and a reserve was offered which was not taken up by the pass-in bidder. Two new bidders appeared and a second auction took place resulting in a sale well over the pass-in figure.

For full details each week of what is happening in the Top End $M+ market see our regular $3-Million-Plus Market Reports.

Round the Grounds – Price this year v last year and a word on Post Easter stock levels.

Malvern John Bongiorno, Marshall White: “Price is a little softer on certain homes but on high quality homes they are still rocking, granted buyers are more discerning. Stock levels are not as strong as last year. Rentals at the top end are exploding in the middle and top end market. Big news is rents have increased, possibly making investments more attractive at the higher end. There is such a shortage of homes to rent.”

Caulfield Rodney Morley, Woodards: “I think the negativity means less stock is coming on in May and Winter. Everybody wants records that are not coming at the moment. The market is definitely softer than this time last year in price. Buyers (then) were buying anything. Right now, buyers do not feel that urgency. No question that the market is softer.”

Brighton Bert Stewart, Buxton: “I think the market is around 10% down on some top end homes. Stock levels and therefore buyer choice after Easter are not looking good.”

Camberwell Geoff Hall, Noel Jones: ”Prices are down around 10% on this time last year, with some exceptions for quality homes, and stock post Easter is just not coming on like it did last year.”

Hawthorn Richard Winneke, Jellis Craig: “Big drop in new buyer enquiry this week. Probably due to the holiday factor but it was a noticeable drop. Rentals are definitely getting more than I expected price-wise and this may stimulate investment into Top End homes. East of Burke Road (Camberwell and Canterbury) has not performed as well as Hawthorn and Kew this year to date. I think prices are still relatively solid around that early million dollar mark but softer higher up.”

Carlton Tom Roberts, Nelson Alexander:  ”Stock levels Post Easter are tightening with only the sellers that need to sell going to market. Good homes still going exceptionally well but those results are in amongst the not so good going not quiet so well as last year. Prices are down a smidgen.”

Playing for Keeps here. Big 150 plus crowd. 29 McKinnon, Carlton. 3 bidders. Bought for a whopping $1,417,000 (462 sqm). We thought it was justified, but it was still big. Nick Renna, Peter Sinclair and Melissa Ryan of Hocking Stuart

Biggest Sale we covered: 21 Macartney Ave, Kew; Walter Dodich (Marshall White): After auction, undisclosed around $4,000,000
“Being in the coveted Sackville area this auction attracted a large crowd of about 100. The crowd were well spread out and even blocked the road in front of the property as they heard auctioneer Walter Dodich open proceedings. The auction began in Mr Dodich’s own words with a ‘traditional’ vendor bid at $3,700,000 as no one was willing to start things off. However this was the trigger that allowed two bidders to start the battle off for the property. Initially there were meant to be three bidders however the third bidder couldn’t get his bid in as he always cut off by the other two. When he finally got one in there was applause from the crowd and a cry of joy from the bidder. As the auction went on, the climax built and the crowd held their breath as the price rose and rose yet there was still no indication from Mr Dodich about whether the property was on the market or not. At $4,000,000 Mr Dodich passed the property in and after lengthy negotiations the property was bought after for an undisclosed amount.” (Josh Bong)

Biggest Pass in we covered: 72 Kerferd St, Malvern East, John Bongiorno (Marshall White); Passed in, $2,800,000, no bidders
“With 300 people having viewed this property and 100 or so crowded into the garden of this Gascoigne Estate home, auctioneer John Bongiorno was confident of a sale. But it was not to be with a vendor bid of $2,800,000 the only one of the day and the property passed in. However, with one interested party heading inside, it may not be long before this stunning property is sporting a ‘sold’ sign.” (Debbie McTaggart)

The Big Issue: Architect Adam and Klarity Kris discuss whether they believe buying conditions will be as good post-Easter as they are now.

Auction Video: This week Jen Milligan, our Market News Co-ordinator, fills in for our advocates who were busy with other auction commitments. 15 Epping St, Malvern East, a BenMac auction with Iain Carmichael. Click on the live action auction video.

Buyer Masterclass: Conditions are great for homebuyers – so where are they?

We Only Buy Homes

New Subscriber System: Over the next few weeks we will  introduce a free subscription model giving you greater access to our council-specific wraps, which include auction results, news, opinion and analysis on a micro level. This subscription model helps us improve your browsing experience as clients or general subscribers by delivering more relevant content to you on the site and in your email newsletter. Sign up by clicking Subscribe at the top right of the website. If you experience any problems as we are testing and implementing this new improved system please let us know at enquiry@james.net.au

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.”

SANDRINGHAM, 12 Georgiana St: Concern is written all over Julian Augustini's (Hodges) face. Passed in $1,675,000, no bidders.

Key Points:

• Brighton is like Stonnington at the moment, if it’s good its selling. The market has eased, but unlike last year a number of vendors have responded. However nobody says things are moving upwards yet. What are stock levels going to be like Post Easter – will the significant overhang be taken up, removing oversupply, especially at the Top End? Let’s wait and see. I think Peter Kennett’s comment below is the best of the week.
• Over $2m seems a road to far for many at present as 10 of the Brighton dozen were under $2m and the other 2 were under $2.2m.
• Price check on small land – Were St Precinct. 36 Lynch St (Mark Healey Buxton) was bought  for $1,220,000 privately which equates to $2,687 per sqm.
  

Agent Q & A: Is it a buyer’s market and, if yes, what are the best opportunities for buyers?

Peter Kennett, Hocking Stuart, Brighton: “Yes.  Great opportunities (and) fair choice but the window won’t last long… (with) school holidays and winter coming means less stock available for buyers… (Therefore currently there is) the most stock available for buyers. The best opportunities for buyers are at the top end.  There are great negotiation opportunities at the top end.”

Julian Augustini, Hodges, Brighton: “No.  It is a fair market for both buyer and seller…. It is a neutral marker for both sides…. Current success rate for Bayside is 70% and most are selling and those that are passed in are selling within a reasonable time period.”

New Subscriber System: Over the next few weeks we will  introduce a free subscription model giving you greater access to our council-specific wraps, which include auction results, news, opinion and analysis on a micro level. This subscription model helps us improve your browsing experience as clients or general subscribers by delivering more relevant content to you on the site and in your email newsletter. Sign up by clicking Subscribe at the top right of the website. If you experience any problems as we are testing and implementing this new improved system please let us know at enquiry@james.net.au

See it's not all bad news! ST KILDA, 30 Crimea St: A happy couple embracing. John Carter (Hocking Stuart), under the hammer $1,450,000. 4 bidders.

At 6pm on Saturday the James Clearance Rate for the 35 $M+ auctions we covered was an almost icy 51%. Bidderman, our demand indicator showing average numbers of bidders per auction, remained at a market-cooling 1.4 bidders per auction. We seem now to be firmly in the grip of a Winter chill.

Market Summary:

March 2011 has seen a $M+ auction clearance rate averaging in the high 50s.

As the market continues in its cooler mode, an overhang of unsold homes continues to build. Two-thirds of homes passed-in are still for sale. Add to this the Expressions of Interest campaigns ending in no result and there seems little doubt we are in a softer, cooler, lower market than a month ago – especially at the high end.

Last week we produced a special report on the fate of $M+ properties that had passed in at auction this year and found that only 3 of the 26 $M+ pass-ins we monitored had since been bought a fortnight later. Seven days on from that report only a further two of those pass-ins have been reported as bought. Some of these properties went to auction 3 weeks ago. Of the 13 properties that we monitored last week as having passed-in, four have since been bought.

It seems it’s a tough gig right now for sellers whose property passes in at a price over the market.

Buyers – this is opportunity! You may think it will get worse (or better depending on your point of view). But what is likely is that after Easter sellers simply won’t put their homes on the market, creating a shortage of stock choice resulting in firming prices. We are not economists but the bad news does not seem to be anything other than transient to us right now – especially when the media are carrying credible news stories on housing shortages (supply) and increasing internal and external immigration (demand)

The $1 million to $1.5 million market is different to the rest and is still rocking along. The best description we feel is not ‘cool’, but ‘balanced’ –  leaning in fact slightly to ‘warm’ for this dollar segment. This is the ‘hottest’ market at present and still has a reasonable depth of bidders. Prices are not shrinking as much in this price range.

The one thing that differs in this market segment from this time last year is the number of volcanoes (runaway 4+ bidder auctions). Today we saw 3 volcanoes from 19 auctions on properties between $1m and $2m we covered. This time last year (March 27^th 2010) there were  9 volcanoes from 14 such auctions. That is a volcano rate of 16% today compared with 64% this time last year in that $1m to $2m range. So, even the early $1m+ market has slowed.

Back to to the Overhang or Hangover:  If you accept we are in a Buyers’ market until Easter, then the question for those who haven’t gone into mental lockdown is:

What is happening to price?

That depends on the quality of homes you are looking at. If you just took your information from the results on sales of Red Hot Homes, you could interpret we are in an improving market. These top quality homes seem to be going even better than last year, as we show in the diagram below. (Although it is important to remember that these homes are understandably the focus of the selling agents – given they are marketers).

It is possible to read positive agent news, see some red hot results and look at selected median price changes and see a different story to what is happening to a lot of the market since the Labour Day weekend.

But for many homes where the vendors have circled $3 million as their hoped for price tag, the end result has been below rather than above $3 million.

In a slowing market with dropping prices as well as a fall in turnover (actual deals done), when the median price falls it does so in smaller doses than does the TOP of the TOP END market, because the TOP END tends to fall to the middle while the bulk of the lower end sales tend to hold up the median price. The reverse is not true when a rising price market comes with big turnover increases, because this tends to exaggerate the increases. This is not to say median prices are not useful – they are.

We are not saying the market is bad – we are saying it is good, in fact very good. You as buyers have opportunities to buy well – either by buying at a lower price or by securing a better home than you could have afforded this time last year, maybe even this time six weeks ago.

To buy better you need to be able to

1. Act not freeze.
2. Calculate correct market price ranges in this new market, i.e. when researching past prices it shouldn’t be an automatic plus 15% on last year.
3. Remain flexible if your targeted home is high quality. The market may view it as a red hot and these are still going well and selling occasionally for better prices than a year ago.
4. Adopt strategies to lower the price, or if that is too difficult for you then look for the buys that present opportunities to sell at a lower price without you asking. An alternative is to get a professional who can assist you in price strategies or take advantage of the opportunity to buy a better quality home than you thought possible.

Lower prices and choice can’t be a bad thing for buyers – even if only temporary.

If now is good news for buyers, how will the post Easter market be?

The important issue is stock supply, and to give us an idea of how this is going here are some thoughts  gleaned from our ‘Round the Grounds agent opinion about upcoming stock levels:

• There is not a lot of new stock on offer in Port Phillip due to Grand Prix interruptions. With Easter approaching it is lean times for new offerings.

• Stock in Stonnington is now starting to dry up as Easter interrupts the market. With the vibe dropping since Labour Day we may well see limited stock in the discretionary upper end market coming on post Easter.  19 Huntingfield Toorak (Justin Long) was a classic example of a limited offering that captured the market’s attention. Even allowing for building value at $2,000,000 (and that is generous) that meant that land value with a north orientation was  around $5,000 per sq metre – not exactly a giveaway price, and certainly higher than 2010.

• Peter Kennett, Hocking Stuart, Brighton, believes the window of opportunities and fair choice in Bayside won’t last long. “Currently the best opportunities for buyers are at the top end.  There are great negotiation opportunities at the top end. (But) school holidays and winter coming means less stock available for buyers… “

• In Boroondara there has been tremendous change within the business of real estate. The May and Winter markets will all be determined by stock levels – the size of the overhang, how it’s mopped up and whether or not we will see nervous vendors putting their quality stock up for sale post Easter. For buyers, now may simply be a window and not a trend.

Runaway of the Year to date:
208 Drummond Street Carlton: James Keenan of Nelson Alexander: Terrace home, quality and around 255sqm.  This was quoted and on the market at around $1.5million and two bidders fought it out until, wait for it, around $2.5 million (undisclosed final price). WOW!

$3M+ Market:
STOP PRESS: March, while not huge in numbers, did finish the month with three solid mid-week $3M+ buys – including four bidders at $7 million or better at two auctions.

• Toorak Ottawa Avenue : Jeremy Fox of RT Edgar – quiet sale off market in the mid $8 millions
• Toorak 19 Huntingfield: Justin Long and Peter Bennison of Marshall White – mid-week auction, 3 bidders and on the market at $6,700,000. Bought under the hammer for $7,060,000.
• Canterbury 13 Rubens: Jeremy Desmier Fletchers and Tom Ryan, Sold before Auction: Over $3,000,000.

A sea of umbrellas and a solid result for Justin Long (Marshall White) SOUTH YARRA, 66 Hawksburn: Under the hammer, $2,440,000, 5 bidders

Biggest Sale: $7,060,000: Toorak 19 Huntingfield: Justin Long and Peter Bennison of Marshall White – Mid week auction, 3 bidders and on the market at $6,700,000. Bought under the hammer for $7,060,000. James Connell said afterwards that this market was not all bad news and he added Huntingfield proved that.

Bidderbuzz Auction: 66 Hawksburn Rd, South Yarra, Justin Long (Marshall White); under the hammer, $2,440,000, 5 bidders
“Despite the abysmal weather, a crowd of no less than 90 people attended this South Yarra auction. Auctioneer Justin Long did his best to entice an opening bid from the crowd, but to no avail, and instead decided to make a vendor bid of $1,800,000 to break the silence. Mr Long did not have to wait long for his first legitimate bid from the crowd, which came within moments of his vendor bid. Four other bids soon joined in the mix pushing the price past $2,000,000, then $2,100,000, and finally slowing at $2,400,000. Sensing the conclusion of the auction, Mr Long cannily attempted to extract one or two last bids from the interested parties. The home was eventually bought under hammer for $2,440,000 and applause were heard for the winning party.” (Daniel Ehrenreich)

Biggest Pass In we covered: 79a Harcourt St, Hawthorn East, Mark Dayman (Marshall White); passed in $3,300,000; no bidders
“No shoes were allowed in this property, which happens from time to time. What I wasn’t prepared for were the sixty pairs of shoes that made it difficult to access the front door! The attending crowd of over 130 surely gave auctioneer Mark Dayman some confidence that there might be a genuine buyer amongst the group.  With a succinct preamble it was now up to the crowd to play their part, however the silence led to a vendor bid of $3,300,000 . Still nothing and half time was called. After the quickest half time I have ever experienced, Mr Dayman didn’t mess around and the property was passed in.  Negotiations were commenced with interested parties.” (Guy Angwin)

New Subscriber System: Over the next few weeks we will  introduce a free subscription model giving you greater access to our council-specific wraps, which include auction results, news, opinion and analysis on a micro level. This subscription model helps us improve your browsing experience as clients or general subscribers by delivering more relevant content to you on the site and in your email newsletter. Sign up by clicking Subscribe at the top right of the website. If you experience any problems as we are testing and implementing this new improved system please let us know at enquiry@james.net.au

Auction Video: Klarity Kris reports from leafy Malvern on the Jeremy Fox (RT Edgar) auction at 4 Beamsley. Click on the live action.

Buyer Masterclass: What should you look for when buying a home when there are kids in the picture? Klarity Kris discusses this scenario in this week’s Buyer Masterclass.

We Only Buy Homes

Do you know where all the bidders have gone? Sorry Nathan no! GLEN IRIS, 1/292 Tooronga Rd passes for $975,000 in front of a small crowd.

STOP PRESS: March, while not huge in numbers, did finish the month with 3 solid mid week $3M+ buys – including 4 bidders at $7 million or better at 2 of them.

• Toorak Ottawa Avenue : Jeremy Fox of RT Edgar – quiet sale off market in the mid $8m’s
• Toorak 19 Huntingfield: Justin Long and Peter Bennison of Marshall White – mid week auction, 3 bidders and on the market at $6,700,000. Bought under the hammer for $7,060,000. James Connell said afterwards that this market was not all bad news and Huntingfield supported that.
• Canterbury 13 Rubens: Jeremy Desmier Fletchers and Tom Ryan, Sold before Auction: Over $3,200,000
• South Yarra – The Caroline Coachhouse – they were looking for $3m ish for a very long time (eg in the years) and now Mike Gibson – Kay and Burton has got it away.

South Yarra 17 Acland St: Gerald Delany. Fairly typical of the market for the slightly overpriced or slightly less than perfect. Passed-In with no bidders and now for sale at POA.

New Subscriber System: Over the next few weeks we will  introduce a free subscription model giving you greater access to our council-specific wraps, which include auction results, news, opinion and analysis on a micro level. This subscription model helps us improve your browsing experience as clients or general subscribers by delivering more relevant content to you on the site and in your email newsletter. Sign up by clicking Subscribe at the top right of the website. If you experience any problems as we are testing and implementing this new improved system please let us know at enquiry@james.net.au

Week Ending 26th March: The Market at this level was fairly quiet this week with the good sales, price wise but not too many of them.

• 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 and selling for circle mid $3′s

Armadale 1026 Malvern Road: The recipe was there for a good auction - quality period home on big land - however the market is a different beast from some time ago at this price level and a quiet auction took place with Jack Bongiorno in charge. Opened on a bid of $3,400,000, passed in to that bidder and was bought after for an undisclosed amount. Crowd of 40.

Week Ending 19th March:

Off Markets, Forthcoming Auctions and Expressions of Interest are increasing as market stock levels begin to rise dramatically. However some big sales including a $13,000,000+ in Toorak and a $7,000,000+ in Brighton along with a few other $3m+ buys indicate the market hadn’t completely gone to sleep .

James Tostevin: “Overall a good day. The $3m+ market is hard to read and we are not getting huge numbers of bidders at many auctions;  so there is a case to say the results may be looking healthier than the market actually is – but from a purely stats points of view (clearance rates) today was a good day.”

In Boroondara:

• Balwyn 34-36 Linckens:  (Toby Parker of Hocking Stuart) – a $3m+ auction slotted in for auction this weekend has been bought before.The quote was over $3.7m and if, as we believe, it was bought for close to $4 million then it was a strong sale.
• Kew 41 Victor Avenue: (James Tostevin) – Two strong bidders and sold under the hammer for $4,100,000.
• Canterbury 17a Alexander Avenue: Passed In $3,200,000. No bidders
• Kew 22 Stawell: Passed In $3,000,000. 0 bidders.

In Stonnington:

• 19 Kingston St, Malvern East, Iain Carmichael (BenMac); After auction in excess of $4,600,000
  “Auctioneer Iain Carmichael was in charge of proceedings for this picture perfect home.  A large crowd of over 80 packed in to the beautiful mature gardens surrounding the house, as the sun shone to show this property at its very best.  The initial vendor bid of $4,250,000 didn’t seem over the top given the location of this park-adjacent idyll.  Despite the auctioneer being confident of a sale, no further bids were forthcoming and, after referral to the vendor, the property was passed in. (Debbie McTaggart)
  Footnote: Nobody bid at auction at $4,250,000 but 2 bidders emerged post auction and fought it out afterwards to a price well in excess of the reserve and well in excess of $4,600,000. Go figure.
• Armadale 1026 Malvern: James Redfern of Marshall White: Passed in $3,400,000 and bought afterwards. 1 bidder.

In Bayside:

• Brighton 29 St Ninians: As always, auctioneer Jonathan Dixon opened proceedings right on time and the preliminaries were soon completed. This property has a supreme and uninterrupted view of the Bay from the City to Royal Brighton Yacht Club and the potential for future development was clearly explained by Mr Dixon. Nevertheless, no bids were forthcoming and the property was passed in on a vendor bid of $7,300,000.
• Brighton 18A Martin: Passed In for $3,300,000. 1 bidder.

Labour Day Weekend March 12th: As expected minimal activity over the weekend; well no auctions that is – a heap of new stock was listed to go onto an already over supplied market.

Brighton 2 Shandford: Bought Post Auction for over $7 million or in around $10,000 per sq metre - meaning Melbourne absolute waterfront is amongst the most sought after land in the world. Regina Schmidt and Brian Devlin from Buxton.

On a buying note, the Golden Mile in Brighton is still alive and well with Regina Schmidt and Brian Devlin from Buxton getting 2 Shandford away post auction for an undisclosed amount over $7 million and in fact over Shandford’s other $7 million sale of a few weeks ago. This home had some positives and will possibly be retained but with two blocks totaling around 1400 sqm going for nearly $15,000,000 this shows that Melbourne absolute waterfront has some of the most sought after beach front in the world on a dollar per sq metre basis.

Another quieter one in the Golden Mile just before the long weekend – 11 Kent Avenue (Stan Fisher of Biggin and Scott) – was reported as bought again for an undisclosed amount having been sold only last year for a tick over $4 million. The rest of Melbourne may be a little quiet, but Golden Mile Brighton is relatively hot for land sales (compared to previous years).

In the heart of the Bagel Belt at 85 Lumeah Road Caulfield North (Gowan Stubbings of Kay and Burton) a large block of land (around 1800 sqm) with a tired home on it was sold for an undisclosed amount for over $4 million, under the hammer, having been on the market at $3.5 million – 3 bidders. That makes it number two along with Langdon Road at or over $4m in the last fortnight in Caulfield.

In Stonnington 20 St Georges has been bought for an undisclosed amount. The property had been quietly on the market for some time before a more public campaign this year. The asking price estimate was $12,000,000 to $15,000,000 and it is believed to have been sold in the middle. Andrew Tolson of TBM was the selling agent. We went through it a few times on behalf of different clients and found it to be a home of some class with good light and a nice flowing floor plan – slight negatives were a less than full-sized tennis court and some overlooking at the rear (although it was not significant and, if you lost the tennis court, planting could remedy that). Being St Georges it commanded a premium – although to date its “little brother” down the road at No 10 hasn’t sold at an already passed Expressions of Interest deadline. However, considering the home’s characteristics, it would be hats off to the agents if it got near their $10,000,000 ask, even if it is St Georges.

Also went through 14 Bruce St Toorak late last month –  it has been bought for a reasonable margin over $3,000,000. Again showing the power of good architects and in particular Wayne Gillespie. Difficult block and orientation and a market place that has competition for supply, so this was a good result for an Expressions of Interest campaign and the man that sells a number of these very quietly – Marcus Chiminello.

‘Hoping for $3m in a different market but didn’t quite get there’ stories: In Port Phillip, 7 Pilley Street in St Kilda East, which was originally marketed at an ambitious around $3 million, has been bought for around $2.6 million - Jeremy Fox of RT Edgar. All things considered, this was still a very good result for the area. In Malvern, 5 Gaynor Court with Rob Vickers-Willis got to $2.73 million and a three storey terrace home in Carlton with Anthony Gattuso of AG Property got around the same amount. All solid results.

Overall still a lot of properties on the market at this $3m+ price level that have completed normal auction and Expression of Interest with no result.

Malvern 66 Claremont: Iain Carmichael: Bought for $3,700,000: 3 bidders: At this point, someone yelled "is it on the market?" and the BenMac team hastily retreated inside to speak to the vendor. Upon his return, Mr Carmichael said yes indeed it was on the market and it was here that the bidding really took off. After the price hit $3,625,000, one of the bidders went bang - $3,700,000 - and knocked everyone else out of the competition. A great finish to a great auction

Week Ending 5th March: All the bigger deals were basically in one spot, Stonnington.

Actual Boughts in Stonnington:

• Malvern 19 Hamilton – Justin Long – At Auction – $4,357,000
• Malvern 66 Claremont – Iain Carmichael – At Auction – $3,700,000
• Toorak 9 Ross – Justin Long – Auction – over $3,600,000
• Toorak – 3 Teringa – Andrew(s) McCann and Macmillan of Benmac – post last weeks auction – over $3,500,000 – nearly $5000 per sqm for rear south facing land
• Toorak – 611 Toorak Road – Expressions of Interest – Greg Herman of RT Edgar – $3,500,000
• Toorak – 231 Kooyong Road – James Redfern – Post last Saturday’s auction – over $3,500,000
• Malvern East – 127 Finch St – Rob Vickers-Willis – $3,300,000

Bayside: A Key land Indicator

• 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.

Boroondara: Action at the Top End almost non-existent

• 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.

Port Phillip: The overpriced are as cold as ice in Port Phillip right now. No bites, no action – as evidenced by the pass-ins of yesterday and the first two weeks of this market.

• I went to a Beaconsfield auction yesterday – the offering slightly less than perfect but still a great spot – however the start was a $4million vendor bid and then a $4,250,000 vendor bid. I may have to eat humble pie when the result comes in but for me the four sales on this strip over $4m last year seemed different offerings.
• 49 Howe Crescent, which was advertised in an Expressions of Interest campaign for later this month, sold last week well over its $5m+ guideline for more than $6m (we believe). A very rare large land size at 915 sqm with a double fronted Victorian on it shows the pulling power of large land so close to the CBD in the St Vincent Garden precinct (or just off it). Michael Coen of Hocking Stuart was the dealmaker on this one. Good job.

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

BRIGHTON, 6 Bolton Ave: Steve Tickell (Hocking Stuart) studies the crowd before passing the property in on a vendor bid of $3,200,000.

Key Points:

• Little movement on a lot of the recent auction pass-ins
• Brighton 32 Bay, Regina Schmidt and Brian Devlin – the unit site cnr of Bay and St Kilda was bought for $2,875,000 – before auction.
• Brighton 50 Martin with Nick Johnstone of JP Dixon, sold mid week
• Brighton 6 Bolton Avenue broke that Hampton Golden Triangle run of big auction results in the area – but stay tuned

Agent Q & A: Has the market changed since before Labour Day weekend?
John Clarkson, Hocking Stuart, Brighton:“We are  currently operating in normal market conditions. It is certainly not boom or bust conditions with properties achieving not runaway but realistic results. It is a price driven market for buyers. If vendors are not on the same page, quite simply, the buying market is prepared to walk away. The last three auction weekends have been full of activity . Two of the three weekends have been very positive with last week in Bayside being flat. Stock levels are manageable at this stage . It is unlikely to increase significantly prior to Easter. Buyer enquiry remains steady. It is interesting that for the first time for an extended time, economic forecasters are predicting a potential fall in interest rates next month. That would be a significant influence on activity as we are operating in an interest rate sensitive market.  The $2 million plus market is a tad more reserved. Good properties near local attractions and amenities, schools, shopping and the beach are still attracting a high level of enquiry. However, the buzz word still remains with offers on properties. Many times the  purchaser’s first offer is often the best.  There are some high profile vendors who are still bemoaning the fact they have let a ripper offer go South. The next  party (second highest interested party) is often daylight away.  That is something buyers and vendors are becoming increasingly aware of.  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 at trickle.”
Stan Fisher, Biggin & Scott, Brighton:“I think it is a bit flukey at the moment. At one point, it didn’t matter if a property had something slightly wrong with it. For example if it was near a train line or had an unusual floor plan. But now that’s really not the case. I mean properties right next to the beach will always sell, but at the top end – between $2.5-$5million, there’s a lot of houses that have been on the market for a while now.”

If you're looking for something that doesn’t need a thing done to it, you could have done a lot worse than the house at 109 Willis St, Hampton, which sold recently for $1.88 million

The inner suburbs of Bayside, such as Elwood, Albert Park and Port Melbourne, are great places to live when you are footloose and child-free. But what if you’ve got plans to have kids down the track?

Being able to walk to the local Turtle cafe in Elwood and take a short tram ride on No 79 through Richmond to St Kilda may be worth the sacrifice of a tiny backyard, or having to walk up three flights of stairs, or parking out in a busy street. But when you’ve got a tiny baby or toddlers to think about, that inner urban environment mightn’t seem quite so charming. And once those littlies turn into teenagers, your main desire might be to put as much room between them and you as you can.

Does that mean you have to move right out to the ‘burbs though? After all, you’ve established a life in your suburb, you’ve probably got friends there and maybe family nearby, as well as shops and other facilities you’re familiar with. And those inner suburbs are always going to be in demand, so a house there may well be a good investment.

Inner-city family living depends how much you’ve got to spend and what you’re prepared to trade off. Family homes on a decent-sized block come at a premium in places like Richardson St, Middle Park, Chomley St, Prahran and Addison St, Elwood precincts. So if you want to stay close in, you may need to make a compromise between land size or quality: between a house on a family-sized block that needs work to get to a liveable standard, or a better quality house on a smaller block.

Each option has its drawbacks – living through a renovation can be stressful, especially when children are in the picture; and what might seem cosy when the kids are small could become unbearably cramped when they grow into teenagers. Relocating is another option, but that can be expensive and unsettling too.

Then there’s the question of whether you’d be better off with double storey single-fronter or a single storey double-fronter. For young children, a single-level double-fronted probably works best – but once you’ve got hormonal teenagers, you might crave the bedroom separation of a double-storey home.

Even if it seems years ahead, you might also want to be thinking about schools. Living near your children’s schools has the benefit not just of reducing their travelling time to school, it also means they are going to be nearer their friends and after-school activities. As a parent, especially if you’re both working, the last thing you want to be doing is forever taxi-ing your kids halfway across the city. This is one of the reasons why suburbs like Brighton and Malvern and Camberwell are popular family suburbs – generous land sizes, pleasant quiet streets, good public transport and close to schools.

So let’s say you’ve got $2 million to spend and you want a family home – what are your options?

112 Ruskin Street ELWOOD | James Home Rating (718/1000)

If you definitely wanted to stay somewhere like Elwood, for under $2 million you’d be looking at a place like one we rated recently on James Home Ratings. 112 Ruskin Street was in a great position on one of Elwood’s premier canal streets, and on a good sized block for the area at 507sq metres. It came in at $1.75 million. The house needed a bit of tarting up, but after that it could work okay for a few years with a small family. If you wanted to expand, you’d probably need to go upstairs, unless you’re prepared to lose a lot of that backyard. But that could work well for dealing with the teenage years.

Then again if you were prepared to leave the buzz and lights of the inner city behind, say to Brighton or Hampton, you could see that $2 million go a lot further.

39 Regent Street BRIGHTON EAST | James Home Rating (749/1000)

Take a house like that at 39 Regent Street, Brighton East which sold for just on $2 million late last year. On a north-facing block of 900 square metres, and set on one of Brighton East’s premier streets, one house down from the park, this was a well-laid out family home with a huge backyard and pool. All the living areas looked out over the backyard, great for when you’ve got littlies, but the layout of the house – with the bedrooms up the front – means it will also be handy for when the kids get older and you need some separation. This place will work for some years, and, if you decide to do the big renovation, you’ve got a lot of space to work with.

If you’re looking for something that doesn’t need a thing done to it, you could have done a lot worse than the house at 109 Willis St, Hampton, which sold recently for $1.88 million.

109 Willis Street HAMPTON | James Home Rating (780/1000)

This was a beautifully renovated, family size period home, close to the action of Hampton Street, schools and transport. The backyard wasn’t huge, but the house was fantastic for kids – from littlies through to teenagers – with four big bedrooms, a good separate kids wing upstairs, complete with rumpus room.

So under $2 million does give you plenty of choices. Whether you stay in closer to town, or move out a suburb or two, the important thing is to understand the trade-offs, and what they may cost you and your family over the long term – in terms of money, time and happiness. Go in with your eyes open and you’ll make decisions you’re less likely to regret.

BRIGHTON EAST, 77 Comer St: It looks like every man and his dog was at this Brighton East auction; but everybody came to just watch. Stewart Lopez (Kay & Burton) passed the property in, no bids and a crowd of 65.

Key Points:

• The level of market softness outside the heart of Brighton surprised most
• Brighton 29 St Ninians: Passed in on a vendor bid of $7,300,000.
• Brighton 18A Martin: Passed In for $3,300,000. 1 bidder.
• On a buying note the Golden Mile in Brighton is still alive and well with Regina Schmidt and Brian Devlin from Buxton getting 2 Shandford away post auction for an undisclosed amount over $7 million and in fact over Shandford other $7 million sale of a few weeks ago. This home had some positives and will possibly be retained but with two blocks totaling around 1400 sqm going for nearly $15,000,000 this shows that Melbourne absolute waterfront has some of the most sought after beach front in the world on a dollar per sq metre basis.
• Another quieter one in the Golden Mile just before the long weekend – 11 Kent Avenue (Stan Fisher of Biggin and Scott) was reported as bought again for an undisclosed amount having been sold only last year for a tick over $4 million. The rest of Melbourne maybe a little quiet but Golden Mile Brighton is relatively hot for land sales (compared to previous years).

Agent Q & A:“What is your take on the Economist’s article that Australian house prices are overvalued by 56%?”
Sam Paynter, Hodges, Brighton:”There is a great report by economist Paul Bloxham called “House prices are high but we shouldn’t fear a bubble” in which he says that yes, house prices are high, but for good reason. One is that the quality of the housing stock in this country is high. Secondly, well located dwellings are in limited supply, and thirdly public transport from outer suburbs in the country’s major cities is generally of low quality, limiting the distance people live from the city and lastly that there is a lack of affordable land at the fringes of the major cities, thus increasing demand for inner city properties. He goes on to say that with strong prospects for the Australian economy we can expect housing prices to continue to grow at a modest rate and that the risk of a sharp fall in housing prices was low. I think that says it all.”
Jenny Dwyer, Hocking Stuart, Sandringham:”The view of ‘The Economist’ that house prices are overvalued by 56% may be accurate in certain geographical locations across Australia, however it does not apply to the Melbourne residential market particularly in blue chip areas such as the bayside suburbs.  The consistent pressure being bought in bear in this city in terms of migration to Melbourne reflects a high level of interest to acquire real estate that is centered around transport hubs, schools, shops and in the case of the bayside suburbs an enviable lifestyle to match. As the saying goes “they’re not making any more land” and whilst we are seeing more stable market conditions across the market place we continue to see strong buying activity across all pricing spectrums and this shows no signs of abating in the forseeable future.”

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.”

More big crowds this week, such as this one at 27 Auburn Pde, Hawthorn East, which stopped traffic! Under the hammer, $1,360,000, Peter Batrouney (Jellis Craig), 4 bidders

At 6pm on Saturday the James $M+ Clearance Rate on the 32 auctions we covered dipped to 59%. For the second week in a row there were around 150 new $M+ listings in our main coverage area of Bayside and the Inner East. Buyers have firmly said to sellers – “if it ain’t priced right we ain’t bidding, because we can see plenty of other homes coming on”. This attitude was particularly evidenced by the ‘duck’ rate (auctions with no bids and no sale afterwards) which was almost 1 in 3 this weekend  – well up on last weekend.

However there were exceptions – such as in Stonnington at the top of the Top End where there was almost no stopping the market and it made its strongest statement of the year so far.

Where is the Market At?

Last week there were indications the early $million+ market could be warming up a bit. But a second strong week of listings has taken some heat out of the market.

The strongest “take notice of me” stat was this weekend’s Bidderman dropping back to 1.5 from a more healthy 2 last week. What that tells us is that buyers are seeing stock choices going forward and the urgency has dimmed on some homes.  If Bidderman continues like this to Easter, prices are unlikely to rise.

This weekend we did see price pressure on quality homes, with quite strong bidding at a number of auctions (including several $3m+ auctions) and five ‘volcanoes’ of 4+ bidders per auction.

What we’re saying is that this first market period, up to Labour Day, has started healthy and balanced. But the second market (up to Easter) is no longer a shoo-in positive for would be sellers.

For buyers, this two week stock surge presents an opportunity for good prices on some good homes that the market may miss – at least until Easter. But things can change quickly – while May last year saw oodles of stock coming onto the market, that may not happen again this year. Given we’ve got such a late Easter in 2011, we may already be seeing the stock surge we saw in May last year, which could mean we don’t get strong stock levels this May.

Crowd Numbers: Again we had big crowds at many auctions, indicating a strong level of interest in results. This weekend we reported one in three auctions with 80 or more people in attendance. All others had good numbers watching.

Our $M+ Supply Indicators:

New Stock: This has been the second huge week in a row for listings with around 150 $M+ homes newly listed for sale in the Inner East and Bayside areas that we cover. There were around 200 $M+ listings across Greater Melbourne.

Actual Numbers Sold: There are solid numbers of $M+ homes changing hands, which is in part why we are not yet buying into any  cries of  a “weak market”.
Agent Market Comments:
Gerald Delaney (Kay & Burton): “I can’t see anything wrong with the market at the moment. We have seen good interest on good properties. I definitely think the market is a healthy one.”
Justin Long (Marshall White): “I feel the market has a bit of upward pressure at the moment. The well priced properties are going beyond expectations and the overpriced or not so good can be very hard work.”

James Marketnews Big Issue:
A few Expressions of Interest and Forthcoming auctions are coming back – a possible sign the pre-Easter auction market is viewed as oversupplied. Watch the discussion on Market News TV.

‘Round the Grounds Snapshots
Boroondara -  Stock Surge in Boroondara – Clearance Rates are definitely not as good as we are used to, but nearly 40 homes at $M+ were bought this week
Bayside – Bayside still shining the brightest – more stock coming on pre Easter will re-test its underlying 2011 strength
Port Phillip – So-so weekend, but stock wasn’t that exciting. Wow on Howe – Big $6m+ sale.
Stonnington – Where the big action was this weekend.
Rest of Melbourne – Just not a lot of $m+ auction action happening so we held over this week’s report
More Detailed Analysis in our Weekly Local Council Market Wraps

$3M+ Markets:
New Homes: Definitely weaker than last year particularly in the Balwyn and North Balwyn heartland.
Period Homes: Solid interest continues
More News and Specific Results can be found in $3-Million-Plus Market articles on the home page

MALVERN, 66 Claremont Ave: Iain Carmichael (BenMac) led a cracker auction - on the market at $3,300,000 and selling under the hammer $3,700,000, 3 bidders

Biggest Sale: 19 Hamilton Rd, Malvern, Justin Long (Marshall White): Under the hammer $4,357,000
The auction opened on a bid of $3,820,000, was on the market at $4,250,000 and bought under the hammer for $4,357,000. There were two bidders and a crowd of around 150. A solid result for this 1930s reproduction home on 668sqm of land.

Biggest Pass-In: 279 Beaconsfield Parade, Middle Park, Gerald Betts (RT Edgar): passed in $4,250,000
“Auctioneer Gerald Betts opened with a vendor bid of $4,000,000 and closed with a vendor bid of $4,250,000 in front of 40 seemingly uninterested observers.” (Mal James)

Bidderbuzz Auction: 11 William St, Brighton, Rod Richardson (Hocking Stuart): Under the hammer $3,100,000, 5 bidders
“The epic 45 minute auction of 11 William Street had a mix of elements to entertain those spectators watching on – intensity, drama and tension with a few awkward silences thrown in.  In the end it was a battle of the property developers for this generous block of land, in the heart of bayside Brighton.  Auctioneer Rod Richardson showed composure in the face of heckling and the patience of a saint during this long auction, working tirelessly to achieve a solid result for the vendor from the opening bid of $2,710,000 to the winning end at $3,100,000.  All in all, it was an entertaining auction to witness!” (Nikki Hills)

Auction Video: This week Architect Adam heads to Hawthorn to witness James Tostevin and the Marshall White team auction 66 Manningtree Road. 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 Masterclass: A change of pace with Architect Adam telling us why we love Victorian homes – with plenty of facts and figures.

No Marketnews next week with Labour Day Long Weekend.

We Only Buy Homes