A much loved character in South Yarra real estate, Phillipe Batters from Williams Batters didn't have anything going to plan at his Leopold Street South Yarra auction today (no bidders); but he still managed to get it over the line post-auction at $1.73 m

It’s 6pm and the James Clearance Rate stands at 63% for Melbourne’s million-dollar-plus homes. It’s down from last week, but it’s a stat that doesn’t truly reflect the market right now, as the market hasn’t dropped its intensity of the past few months.

All markets reflect human needs, wants and desires. Today’s drop from last week merely reflects vendors who had good homes but a different opinion on price from any buyer who turned up. For example, 65 Finch Street East Malvern should have sold and north of $2.5 million.

Bennison Mackinnon’s Andrew McCann (who sold a classic home in Stanhope St Malvern mid-week before auction) stated that Benmac sold eight from eight today, including 39 Erica Ave Glen Iris, an “Inform” home, for an undisclosed figure (which we feel could have been in excess of $2 million). Andrew, who was also surprised by the Finch St non-sale, said inspection numbers at OFIs are up 30% on last year and, while he feels Stonnington has yet to experience Boroondara’s level of overseas interest, the market overall, in Stonnington, is very strong because of local buyer demand.

You may think that we are talking the market up above what is actually happening. Here again are the powerful stats from Kristen’s Sunday Reflection article of last week, which show how quickly things change in six months:

15 November to 6 December 2008 – four auction weeks
James $1m+ Clearance rate: 35% on 53 auctions
Average bidders per auction: 0.8 per auction
No Bidder Auction rate: 47%
3+ Bidder Auctions we saw: 3
5+ Bidder Auctions we saw: nil

April / May 2009 – last four auction weeks
James $1m+ Clearance rate: 75% on 80 auctions
Average Bidders per auction: 1.875 per auction
No Bidder Auction rate: 28%
3+ Bidder Auctions we saw: 25
5+ Bidder Auctions we saw: 6

Another real news story is how overseas buyers, mainly from Asia, are flooding into the Boroondara market since the Foreign Investment Review Board rule changes relaxed the restrictions on overseas people buying property in Australia. The photo above right is part of the 120+ crowd who attended the Jellis Craig 58 Argyle Road Kew auction. Adam Woledge reports:

A very large crowd of 120 people turned out to see Maurice Di Marzio conduct considerable traffic for this well-elevated block of land in a good Kew street. Opening with a genuine bid of $950,000, things crept along to be on the market at $1.1 million. Intense bidding from five bidders saw this sell very strongly at $1.631 million. A great result for vendor and agent alike. Land in this council area and in the right condition is certainly coveted at the moment.

That’s right: 58 Argyle Road Kew sold $531,000 over the reserve.

I asked Robert Ding from Jellis Craig (I seem to be a bit of a Jellis Craig groupie today) about the FIRB effect on property prices in Boroondara. He stated that his quick stats show that 47% of all Boroondara homes he has sold this year were to overseas people from Asia, and the number of buyers from there is increasing. Robert does have a strong advantage, as he is able to speak Cantonese/Mandarin.

17 Grange Road Kew, which we gave rated at 897/1000 – one of our highest 2009 James Home Ratings – is being managed by Sean Cussell of Marshall White and 30 of the 38 groups through this property last Saturday had an Asian connection.

Overseas demand is, in part, what is pushing residential prices upwards at present.

Bayside and Stonnington have had an increased overseas interest but not as much as Boroondara.

While on the subject of overseas, I would like to congratulate a client on his foresight mid-week to show me just how important currency risk is in a negotiation where a buyer or seller is overseas. I like to think that at James Buyer Advocates, we look at all angles but this is one we hadn’t considered. Our client had considered it and made a powerful argument that quite possibly got the deal over the line. Well done.

We never cease to be amazed at just how many new things our company learns each week, not only from high-quality selling agents but also from very smart clients. Coincidentally, we are involved on the other side of currency risk as a buyer right now and this client has also sent us a currency chart. It is a big deal if you can present your case well.

We really don’t want to start putting up graphs that look like economists’ charts, as this is not the flavour of James Market News, but, in some extreme cases, a suitable settlement can sweeten the deal to the tune of $400,000 on a $4 million deal where either a buyer or seller has to move dollars in or out of Australia.

This week in the James Market News:

We have launched our pre-auction show, with a new edition live on the site each Tuesday. Each week, Mal, Adam and Kristen will discuss homes of interest that they’ve viewed and highlight forthcoming auctions. Any feedback is greatly appreciated.

For the first time, we’ve put up a video of a live auction on the site. We’ve videoed live auctions before but this is the first one we’ve made available to the public. The auction we attended was 25 Mary Street St Kilda West, which hadn’t sold at the time of publishing. Most auctions we’ve witnessed the past month have not panned out like this but we report it as we see it, and Mary St was randomly chosen for our first video. This also shows that, even though the market has some heat, as a buyer you should not assume that everything is going to go hard at any price. Thank you to Justin and Gerald from Marshall White for giving us some of your time (unfortunately not all of which got onto the site, owing to some technical difficulties).

David Gillham of Noel Jones said that we had better put Burwood on our auction visit list with a million-dollar sale at 9 Kilsyth Avenue Burwood ($1,005,000), after a pass-in at $960,000. That is a good result.

Architect Adam has another good article on Mary Street Hawthorn and Grant’s Sunday Reflections looks at the Jason and Kylie Love story, which is oh so true, in oh so many ways.

Our thanks to Hocking Stuart’s Marshall Rushford for his time and insights on Caulfield and Elsternwick, which feature in this week’s Another Point of View. He is also a Collingwood supporter – what a wonderful agent!

Buy Well