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.

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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

SOUTH Yarra, 17 Acland St: The maestro, Gerald Delany (Kay & Burton) in action. Passed in, $3,250,000, no bidders.

Key Points:

• Toorak 17 Lansell with Lisa Jarrett of Abercrombys sold mid week after being on the market since late last year
• Toorak 16 Cole St with Nicole Gleeson of Kay and Burton sold mid week after being on the market since late last year

Agent Q & A: Has the market changed since before Labour Day weekend?
Lachlan Fraser-Smith, BenMac, Armadale:” The main change in the market since Labour Day is that the quality of buyers at open for inspections is very good, however the numbers of people through opens has slowed after a busier than anticipated start to the year. The reasons for this are: as the year settles down after a typical February spike in prices, people have found out at open for inspections and attending the early auctions what they wanted to know about prices and have assessed the market and either go to auction themselves or sit still and stay where they are. Numbers of properties on the market has increased as well but there are still some very active buyers out and about so they quality of buyers is certainly still there. We have been seeing some very strong results between $1 million and $2 million in Armadale and between $3 and $5 million in Malvern and Malvern East.  We will see a reduction in properties coming onto the market going into the traditional Easter, Anzac day and school holiday period. This will, I believe, underpin the market for the homes that come on post Easter in May.”
Iain Carmichael, BenMac, Armadale:“The Stonnington market in recent weeks has performed well given slightly diminished bidding activity at many auctions. Pleasing elements from a vendor’s point of view is that sales are being made and that clearance rates in Stonnington continue to exceed the Melbourne-wide figures by up to 10% each week end. The trend for buyers to hold off bidding is puzzling as the great majority of properties auctioned are still sold for solid prices at or immediately after auction.  Stock levels are reasonably full and the market will test both vendor expectations and buyer depth in the weeks leading up to Easter. It will be interesting to observe whether buyers will continue to run the gauntlet and back themselves into post-auction negotiations and, in some cases, private auctions or whether the true transparency of the auction system will give consumers sufficient comfort to bid with confidence and buy ‘under the hammer’ or become the highest bidder to gain an exclusive seat at the negotiating table.”
Andrew Hayne, Marshall White, Armadale:“No I don’t think things have changed too much. The market has been pretty price sensitive for a while now, so provided vendor’s expectations are in line with the market then there shouldn’t be any problems selling. I am a big believer in each property sets its own market so each one has to be treated on an individual basis rather than generalize about market conditions or sentiments.”

ARMADALE, 2 Avondale Rd: Warwick Anderson (RT Edgar), Passed in, $1,950,000 no bids.

TOORAK, 37 Lansell Rd: Andrew Macmillan (BenMac) passes in for $2,800,000, no bidders, but thanks the crowd for their participation with a wink or two.

Key Points:

• Off Markets, Forthcoming Auctions and Expressions of Interest are increasing as market stock levels begin to rise dramatically.
• Nobody bid at the 19 Kingston St Malvern East auction (Iain Carmichael) 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.
• 20 St Georges Toorak which has been on the quietly on the market for some time before a more public campaign this year has been bought for an undisclosed amount. 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.
• “Little brother” down the road at No 10 St Georges hasn’t sold at an already passed Expressions of Interest deadline – however it would be hats off if the agents got near their $10,000,000 ask, even if it is St Georges, considering the homes characteristics.
• 14 Bruce St Toorak late last month – and it has been bought for a reasonable margin over $3,000,000. Good result for an Expressions of Interest campaign and the man that sells a number of these very quietly – Marcus Chiminello.
• Overall a number of properties on the market at the $3m+ price level that have completed Private Sale or Expression of Interest campaigns with no result.

Agent Q & A:“What is your take on the Economist’s article that Australian house prices are overvalued by 56%?”
Justin Long, Marshall White, Armadale:” While I do not have a view on every sector of the Australian market, as for Melbourne I think the observation is complete nonsense and that by and large house prices for Melbourne seem to me to be reflective of people’s excellent earning capacity whilst still allowing, especially in outer suburbs, the opportunity for low income earners to get a foothold.”

PRAHRAN, 68 Wrights Terrace: Like many of today’s auctions, this one had good numbers in attendance, but unfortunately no sale for Justin Long (Marshall White), passed in $1,610,000, 1 bidder

Key Points: It’s all about the bigger deals this week:

• 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

Agent Q & A

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

Mark Wridgway, RT Edgar, Toorak: “Stock levels over the next 6-7 weeks leading up to Easter are likely to be above normal. This year Anzac Day falls the Tuesday after Easter Monday which leaves only 3 days of that last week, which happens to immediately follow the school holidays. I can imagine that some people will essentially extend the school holidays to almost 3 weeks. Most vendors will want to see that period through before launching a new campaign, so the option is to get your property onto the market in time for a  9^th April auction date or wait until 21^st May.”

Justin Long, Marshall White, Armadale: “ The 3 weekends leading up to the Labour Day weekend were heavily booked even before Christmas hit us, as those who had purchased in late 2010 made plans to complete their real estate transactions at the earliest opportunity. Those not forced into February action seem to have been delayed until the first few rounds of auctions were played out and, the results having been reasonably encouraging, those that have waited are now finally making their decisions. The long weekend has adversely affected stock levels for March and the first weekend in April as many vendors chose not to have that weekend in their programs but as a result, the 9^th April seems to loom as the BIG weekend before Easter. In summary: expect a late (but strong) pre-Easter run.”

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

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

Some interesting results to finish off the month:

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

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

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

• 

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

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

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

Kooyong – 711 Toorak – $3,190,000

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

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

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

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

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

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

Continuing with February Sales:

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

New and old Brightonians like to buy New in Brighton

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

This type of offering sold well over Summer

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

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

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

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

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

TOORAK, 7 Toorak Ave; Kevin Bartholomeusz (Carroll McKeddie) basks in the glorious sunshine and a successful sale. Under the hammer, $2,763,000, 2 bidders

Agent Q & A:“Do you feel there is currently a big difference in the results of sales of lower end ($1m) properties as opposed to those of higher end ($2m+) homes? Yes or no, and why?”
Brad Fleming, JP Dixon, Toorak:”Across the board the demand for properties under $1 million is and always has been stronger because of affordability for both the home owner and investors, which achieve higher rental yields and less mortgage stress. As soon as the buyer can afford properties at $2m+, normally the demand is driven by purchasers with higher incomes wanting to buy a home which suits their personal requirements, especially with families, for example, who are thinking long term with family needs as the priority. This group becomes more focused around accommodation, location including schools and school zoning if required.  Personally, l have found both markets strong thus far, however the source of buyer does change depending on situation of the given real estate environment at the time of buying.”

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

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

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

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

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

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

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

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

Bayside – Overall Clearance Rate solid for Brighton – 77%

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

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

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

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

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

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

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

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

We Only Buy Homes

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

Kooyong – 711 Toorak – $3,190,000

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

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

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

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

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

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

Continuing with February Sales:

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

New and old Brightonians like to buy New in Brighton

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

This type of offering sold well over Summer

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

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

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

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

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

MALVERN, 26 Cressy St: Andrew McCann (BenMac) watches as Iain Carmichael takes the helm. Passed in $1,560,000, no bidders

Key Points:

• You can only buy what’s on offer, and a 61% clearance rate in last year’s Stonnington terms was a solid start
• The market was only tested in the lower echelons of price and seems unlikely to really be tested at $3m+ for some time as there appears to be minimal action in this price range
• The biggest sale was at 29 Scott Grove, Glen Iris, Gowan Stubbings (Kay & Burton), $3,032,000, 3 bidders

Agent Q & A: How have you found non-auction sales so far this year?
James Connell, Marshall White, Armadale:“So far this year, there has been a good underlying market. We’ve found there is quality stock around and it seems buyers (and sellers) have a little more confidence this side of Christmas, compared to the latter part of last year.”
Peter Bennison, Marshall White, Armadale:“Private sales have been very strong this year.”
John Bongiorno, Marshall White, Armadale:“In fact, we’ve just recorded the greatest number of daily hits on our website.”
Simon Dale, BenMac, Armadale:“Private sales have been strong so far as have auctions. We sold six from six at auction last weekend.”

Anyone? Lachie Fraser-Smith does his utmost to drum up some bidding at 86 Park St, South Yarra, but to no avail. Passed in on a vendor bid of $1,700,000, no bidders and small crowd of 20

Key Points:

• I personally went to 8 auctions in Stonnington today – five were bought. Bidderman at the auctions I went to (7, 3, 7, 0, 4, 0, 4, 3)
• Agent chatter has been more upbeat this week than at any other time this Spring
• 376 Glenferrie Road Malvern with Iain Carmichael of Benmac – bought on Sunday morning for $4,415,000

Tim Wilson and Jeremy Fox get ready to do battle at 2 Bromley Toorak, but in the end there were not in the trenches and they stood there as generals and watched 3 bidders slug it out to $5,600,000 - $800,000 over reserve.

Week Ending November 27th:

The high end ($3m+) which like the proverbial brides nightie (not sure if I can say that) is up and down at the drop of a hat. A fortnight ago it was up and last week it was down – this week it was up and in a big way – below are some of the results.

Highlights:

• Toorak 2 Bromley with Jeremy Fox of RT Edgar for 5,600,000 – 3 bidders (see report)
• Hampton 3 Lorraine for over $3,000,000 with Nick Johnstone of JP Dixon (Expression of Interest)
• Armadale Adelaide (Off Market)
• Hawthorn 41 Wattle Road – good home on the market for some time bought for well over $5,000,000 through Paul Keane Jellis Craig
• South Yarra 2/155 Domain Road Marcus Chiminello of Marshall White bought for in excess of $7,500,000 or $20,000 per square metre  (Off Market)
• Toorak 88 Mathoura Road for $6,500,000 bought before – also Marcus Chiminello
• Armadale 12 Munro with Tim Derham, passed in at auction last weekend at $3,000,000 and has been bought afterwards.

$3m+ not so highlights:

• Brighton 12a Manor: Passed In $3,800,000: Zero Bidders
• Hawthorn 5 Yarra: Passed In $4,500,000: Zero Bidders
• South Yarra 16 William: Passed In $4,200,000: Zero Bidders
• Canterbury 35 Logan: Passed In for $2,860,000: Zero bidders

South Melbourne 9 Anderson: An exciting auction which had a buzz from the crowd, trams, birds and sounds of people playing sport down the street at the Melbourne Sports And Aquatic Centre. Geoff Cayzer was auctioneer and, although soft spoken, he was very entertaining with his humour and pre-auction speech. This lightened the atmosphere and allowed two bidders to fight it out after Mr Cayzer's opening bid of $2,850,000. The battle wasn't long though as after some 5 bids the hammer was brought down and the property sold for $3,250,000, which brought cheers and jubilation from the winning bidder's party. A great, fun and entertaining auction to watch.

Week Ending November 20th:

This market seems clear as mud in terms of short term directional pointers. Some good ones sold, some good ones didn’t and all on a turnover down on this time last year and down on September of this year. But the market hasn’t stopped completely in its tracks eg 50 Charles Kew with Paul Keane of Jellis Craig – going nowhere for some time then some interest, then bang a boardroom auction and well north of $4,200,000 was achieved on the night. On the quiet side, a second off market north of $13,000,000 in recent times – actually it was over $15million and in establishment Toorak – Mike Gibson from Kay and Burton the selling agent.

$3M+ Highlights

• Malvern 116 Stanhope: Paul Keane of Jellis Craig. Bought for just under $3,500,000
• South Melbourne 9 Anderson: Geoff Cayzer. Bought under the hammer for $3,250,000: 2 bidders
• Ivanhoe 9 Nyorie: David Oster of Jellis Craig. Bought after auction for $3,100,000: 2 bidders

$3M+ not so Highlights:

• East Melbourne 105 George: Passed In on a vendor bid for $4,500,000
• Malvern 1 Wilks: Passed In on a vendor bid for $3,000,000
• Armadale 12 Munro: Passed In on a vendor bid for $3,000,000

Great Expectations but in the end it was more like Bleak House as 50 Hotham Melbourne East failed to sell under the hammer. Passed In for $7,000,000. Glen Coutinho of Hocking Stuart

Week Ending November 13th:

………But this new state of affairs does not apply so much to the $3m+ market which was a little less shiny today after shining like a beacon 7 days ago. In fact there were a number of significant pass-ins at this level this weekend.

So in a nutshell: last week’s doom and gloom on low quality stock and a negative feel mid-week at open-for-inspections was followed by a bit of a bounce-back this weekend – with more homes selling than expected. But that’s not to say it’s a strong sellers market by any stretch of the imagination. At present the market is, in our opinion, between cool and warm, depending on the quality of the stock. We await with interest next week’s instalment as to where our late Spring market is heading.

Highlights

• 32 Linlithgow, Toorak (Jeremy Fox of RT Edgar) was the biggest sale of the day (see report below)
• 4 Snowden, Canterbury (James Tostevin and Duane Wolowiec of Marshall White), Bought after at an undisclosed price of more than $3,000,000.
• 35 Cole St Brighton (Ian Jackson of Kay and Burton), Bought at auction for a shade over $3,500,000 – after not selling at an Expressions of Interest campaign earlier in the year

Lowlights

• The weather
• Biggest Pass-In was at 50 Hotham East Melbourne, a great home with an 800+ James Rating. It failed to attract any bidding near the reserve and was passed in at $7,000,000
• $3M+ pass-ins at 188 The Esplanade Brighton, 3 Buley Hawthorn East, 18 Heyington and 12 Merriwee Toorak

Camberwell 18 Currajong: 3 bidders, 3 advocates and one great auction: Maurice Di Marzio: Bought under the hammer for $3,375,000

Week Ending November 6th:

What a difference a month and some increased stock levels make. If you have a look at our $3m section in October and compare it to our September report you will see a big difference in activity, especially when you consider the market had a clean run in October with no election and limited footy interruptions, and had five

Click on video to see $3m auctions live

auction Saturdays. This market is as fickle as the horse race we love to watch. In Winter this market was down, in September it definitely perked up and now the $3m+ and off-markets would appear to be edging downwards again. But again the statistics are hiding the full story: there were in fact a few sales over this level we have been asked not to report on, and we ourselves have purchased four off-markets over $1million in the last month, in Brighton, Clifton Hill, Hawthorn and Caulfield. Plus look at this weekend’s $3m+ results! The fact is, there is still plenty of activity – just not as public as in September. There are good homes available for sale off market if you know where to look.

• Elwood 45 Dickens: Jason Scillio: Under Hammer: $3,535,000:  3 bidders
  A large crowd gathered in the front garden of this magnificent property to hear Jason Scillio provide a well prepared preamble prior to inviting bids from a large crowd on this beautiful afternoon. After the usual hesitation, strong bidding emerged from three buyers and it was on the market at $3,450,000. The house was soon bought with a strong bid $3,535,000. (David James)

• Carlton North 810 Drummond:  Tom Roberts:  Under Hammer  $3,450,000:  3 bidders
  What a home. This is the best example of the saying ‘don’t judge a book by its cover’.  It is an ugly duckling from the street, but when you walk through the door you’re hit with one of the most stunning living area renovations I have seen in Inner Melbourne. The auction itself started with a pretend bid at $2,000,000 that was immediately countered by auctioneer Tom Roberts with a vendor bid at $3,000,000 and she took off from there. Three bidders and on the market at $3,300,000 before settling at $3,450,000 in front of a crowd of 125.

• Toorak 6 Benson: Gowan Stubbings: Bought around $3,000,000: 3 bidders
  A great auction to watch. Auctioneer Gowan Stubbings led the way, offering a vendor bid of $2,400,000 after a member of the crowd offered an initial bid of $2,350,000. With three bidders overall, it became a battle between two very confident, strong parties, both determined to fight it out to the very end. One bidder offered increments of $10,000 and even $100,000, while the other settled on $1000 increments each time. Ultimately, the $1000 bidder won, walking away with the property for an undisclosed amount close to $3,000,000. A very entertaining auction with a crowd of around 60. (Jen Milligan)

• Some solid results outside Saturday’s auction:
  Toorak 63 St Georges: Andrew Baines of Kay and Burton: Expression of Interest for just under $8 million. Went through this home and tennis court.It had a good feel and, just as the ad says, an exclusive street address. At around $4,000 per sqm it was a win for the buyer and seller.
  Two blocks of flats sold at mid week auctions: South Yarra 28 Tivoli ($4,825,000)  Philippe Batters: 46 Ulupna; Ormond ($3,700,000) Andrew Chisholm.
  Brighton 11 Kent Campbell Cooney was bought post auction for $4,100,000, which put south-facing, non beachfront land on the Golden Mile at $3,800 per sqm

• It was gratifying to see the number of professional advocates acting for buying clients this weekend. The Bidderbuzz auction at Currajong auction had three advocates, and there was one each on Benson, Drummond, Elwood. While the advocate didn’t win the chocolates for their clients every time, at least it shows more $1m, $2m, and $3m+ buyers are making informed decisions.

Give me one more bid: Elliot Gill, Bennison Mackinnon, tries to coax some bids from the small crowd at 15 Soudan St, Malvern. Bought after auction, $1,600,000, 1 bidder

Key Points: Slightly healthier clearance rate in Stonnington this weekend with 63% on reported $1-million-plus auctions. However, we only saw 1 property sell under the hammer out of the 8 auctions we monitored, with 2 bought before, 2 bought after auction and the other 3 passing in.

A cold start weather-wise to October, but the $3 million and more market is warming up (a bit). Bring on Super Saturday. 100 Victoria Albert Park - Andrew Stuart - bought in the rain for $3,270,000 - 3 bidders:

End of October Report: October seemingly not as strong as September in these markets.

What a difference a month and some increased stock levels make. If you have a look at our $3m section in October and compare it to our September report you will see a difference in activity – especially when you consider the market had a clean run in October with no election and limited footy interruptions – plus there were 5 auction Saturdays. This market is as fickle as the horse race we love to watch. In Winter this market was down, September it definitely perked up and now the $3m+ and off markets appears edging downwards again. But please it still has some oomph as there were a few sales over this level that we have been asked not to report on and we ourselves have purchased 4 off markets over a million in the last month – Brighton, Clifton Hill, Hawthorn and Caulfield. Plus look at the first weekend in November $3m+ results – BANG. There is activity it’s just not as much or as public as it was in September. Some good homes are available for sale off market if you know where to look.

Mid October Report: There is off market stock that is genuinely for sale in the Top End market at present. Yes there is always a lot of stock sitting there quietly, but usually from sellers who prefer to dream rather than deal. However currently some of this quiet stock seems more attractively priced than in past months. That is possibly because buyers have lifted their sights a little and last weekend’s results (9th October) brought into focus for sellers that a down market is a possibility post Melbourne Cup. All this helped create the environment for a number of  matching opinions between buyers and sellers. There were six matching opinions in fact, with six homes reported as bought at this level in the last week.

Early October Report:

Country Offerings: This is a time of the year when I love my job and so does my wife (she doesn’t see me). It’s a beautiful time to be driving to Mount Macedon or down to the Peninsula or out to the Yarra Valley. In the last fortnight 20 to 30 new country estate offerings have hit the public market and there are one or two very attractive propositions. Kay and Burton, RT Edgar and Abercromby’s have the pick of them.

Super Saturday the 23rd of October has some ripper homes over $3million on offer and will be a true public test as to the ongoing strength of the post Melbourne Cup/pre Christmas $3m+ market.

Toorak 68 Hopetoun: Geoff Hall and David Gillham: This classic art deco home on the corner of Toorak road has been back to the market again and resold. It was last on the market in March 2009 where is was bought for a tick under $2,900,000. This time around Noel Jones slapped a sold sticker on it last week prior to auction.

Malvern East 98 Finch: Ross Savas and Nicole Gleeson: I remember going to this home many years ago when it was just a shell and describing it as a grand lady with all its family (land) gone. Last century this would have been the centre point of a major estate. This time around 98 Finch has been renovated to an extremely high standard, turning it back into the grand lady she once was. The vast land (19th century opulence) has been replaced by a grand design (21st century opulence). The effect of the revamp and the quality of what was on offer was demonstrated by the fact that it was snapped up after the second open for inspection. No long and laborious negotiations post the expression of interest deadline here. The ink is still drying but the exchange figure would seem to be well in excess of the $6,000,000 suggested starting point.

Two land sales showing vastly differing Melbourne land values

a) Land at 101 River Avenue Plenty (39,500 sqm), which can be subdivided, was auctioned by Rob Stefanovski of LJ Hooker Greensborough and  bought for $3,830,000 or $96 per sq metre

b) A large land parcel (1,813 sqm) at 3-5 Heath St Sandringham sold after a failed auction by Bill Jowett of Buxton for $2,800,000 or $1,544 per sq metre

There will be a fair bit more to report in the next week or so – once we catch our breath.

Latest Auction Coverage

Albert Park 100 Victoria: Andrew Stuart of Hocking Stuart: Under the Hammer $3,270,000: 3 bidders:

Andrew Stuart led off with an opening vendor bid of $2,750,000 in front of a huge crowd of 120 for this classy Victorian. A minute of two later, after getting a little confused with his maths, he accepted a rise of $25,000 from Bidder 1 – proclaiming it a “bloody good bid”. A second strong bidder joined in and together they pushed the price up to $3,000,000, at which point we had the half time break. Upon resumption the property was declared on the market. Later bidding stalled and it looked all over and a win to Bidder 2 at $3,220,000, until a late bidder joined in – every auctioneer’s nightmare. He wasn’t actually a late bidder, rather an almost late bidder. And he wasn’t able to break Bidder 2 who prevailed a few bids later at $3,270,000. It may have had something to do with the phone clapped to his ear. I can’t remember the last time a person with a phone to their ear has won. The phone bidder always looks weak. Anyway, well done to the winner, Bidder 2: I liked your style. And Bidder 3: Why do it? Andrew will give you a fair go if you don’t play games.

Toorak 10 Merriwee:  Jeremy Fox of RT Edgar: Passed In $3,200,000

Unfortunately for Jeremy Fox and the RT Edgar team, there wasn’t much action at 10 Merriwee Crescent on Saturday afternoon. The sun stayed out during proceedings and Mr Fox tried to excite the crowd by suggesting that the parting of the clouds on such a miserable day was a good omen. But it was not to be and hands stayed firmly in pockets. Mr Fox kicked things off with a vendor bid of $3,200,000 but, with no genuine bids coming from the crowd, he was forced to pass the property in for the same amount.

We only buy homes

Some of our buyer prayers have been answered

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

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

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

This Week’s Highlights:

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

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

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

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

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

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

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

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

Special Report on the $3m Market

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

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

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

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

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

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

Agent Comments on the current $3m+ market

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

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

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

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

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

Reported Results: