Prahran, 4 Grandview, Jeremy Fox, Under the hammer, $4,570,000. 3 bidders

Saturday March 31st: Solid finish to the month – partly as a result of vendors lowering their expectations as they feel the market may get worse before it gets better, partly due to some good stock and partly because buyers can’t really see anything of note on the market after Easter.

But to keep some perspective if you read our archived $3m+ reports of previous years you will see the same buoyant activity leading into Easter -  its after Easter that gets interesting.

Big Day at Auctions for the Top End

• Prahran, 4 Grandview, Jeremy Fox,  under the hammer $4,570,000, 3 bidders. This was a Super Saturday sizzler! Three determined bidders contested for this breathtaking property after auctioneer Jeremy Fox kicked things off with an opening vendor bid of $4,000,000. It was a little slow at first but the action heated up as the third bidder chimed in. He eventually secured the property for $4,570,000 and that sparked applause from the 130 onlookers.
  James Home Rating 865/1000 “I found it hard to find fault with this home – its WOW all over – the flow works brilliantly, locale for Prahran is in THE street and garaging, kitchen, laundry set up is efficient and classy – the north light is brought in nicely into living areas. The bedroom set up works and the reflection pools aren’t twee they are classy. Do I sound over the top on this? This home will fly and I mean fly unless the RT boys cook the quote or the vendor is dreaming. Best guide is 51 Murray St Prahran in May 2010 (See our rating and auction report, over $3,700,000) and the recent sale of similar land size without the same WOW by same company a couple of weeks ago at 22 Murray St (north of $3,400,000). Our suggested strategy to buy – dig deep on the day or go hard and early now!  ” Mal James

• Armadale, 3/50 Hampden, John Bongiorno, under the hammer, $3,360,000. 2 bidders.  Last sold for just over $2,500,000 in 2005.
• Toorak, 27 Selborne, Jeremy Fox, after auction,  $3,300,000, 1 bidder

Pass-Ins

• Toorak 49 Irving, Passed In on a vendor bid at $4,500,000
• Camberwell, 12a Royal, Passed In on a vendor bid at $4,100,000

February Top End Pass-Ins still really struggling a month later!

But it’s not all good news at this level if you don’t get the price right. A month ago we reported on ten auctions over $2.5 million. Two sold on the day and eight passed in. Since then only a further two have sold and both were below the pass-in price. Although the stat is on a small sample it says at this level 40% clearance rate after a month.

Friday March 30th: 2a Chelsea St Brighton with Sturt Hinton of Kay and Burton got away after an eternity on the market for an extremely healthy result of $3,600,000 (according to another agent).

Thursday March 29th: Expressions of Interest still working with Michael Armstrong moving 11 Moralla Road Kooyong – over $5million.

There has definitely been a resurgence in Bayside in the last few weeks at the top level and one new company that is giving the big boys a run for their money is Nick Johnstone of Nick Johnstone real estate – as you know we have a fair bit of time for him, as he actually gets off his back side and shows you homes, suggest alternatives, tells you asking prices (which a number of others for some stupid reason think should be a complete mystery) and follows you up. Good real estate at the Top End is not for rocket scientists – we know because we aren’t. Turning up with a sprinkling of facts and treating people with a certain level of decency is ¾ of the job. Anyway let’s look at Nic’s circa $3m sales this month alone in Brighton

• 1 Norwood – North facing land one back from the beach
• 20 Birdwood – James Home Rating of 714/1000
• 13 Halifax – ripper property see our James Home Rating 661/1000
• 19 St Ninians – heart of the Golden Mile see our James Home Rating 588/1000

And while on the subject of smaller boutique companies we have always liked the work of Paul Richards who sold 53 Barnard Kew for we believe over $6,000,000 earlier this month and we were amazed to see another company claiming the deal – anyway Bekdon Richards with Evan Lykourinos is a young company who also speaks reasonably accurately, gets out of bed early and pushes through some big deals quietly over the line.

And one for the big boys – Justin Long of Marshall White moved 8 Harvey St Malvern on Monday for we think over $4million – went through it late last year and thought it may take some time to shift – a credit to his persistence and if achieved anything over $4m in this market it would have been a good result for both parties.

Another one quietly gone in the Gascoigne (Kay and Burton) at circa $3m price level and the big one in Boroondara should emerge soon to give some small confidence at the Top of the Top End. Not trying to be tricky but we do respect privacy when asked.

Mortgagee Auction: 8 St Ninians Brighton, David Hart, Under the Hammer, $4,900,000, 3 bidders

Saturday 24th March: It is neck and neck for the strongest areas in the $3 million segment for March: so far Brighton has sold 7, Hawthorn, Kew and Canterbury also 7 and Toorak 6 for the month so far – daylight the rest.

• Brighton, 8 St Ninians, David Hart, $4,900,000, 3 bidders.
• East Melbourne, 125 Gipps St, the newly married Nathan Waterson should pay for the wedding with a private sale at slightly below $4,000,000. A great terrace home and a good result, but below initial ask and took a fair while for the vendors to come into line. Next door’s ask now seems even more courageous than when I first heard it. But I have had the taste of humble pie once or twice this month so will wait and see.
• Kew, 5 Tregarron Avenue, Sam Wilkinson – Expressions of Interest in the mid $3 millions. Now with Sam who has deservedly a good reputation at this level on these homes. Is he not the spitting image of young Brains on Thunderbirds!
• Hawthorn East a quiet one away for Nicholas Franzmann and hopalong Walter Dodich in the over $3m category. New home build – good result in the end.
• McKinnon, 41 Rose St – yep its not a misprint – McKinnon – Adam Joske and Phillip Kingston under the hammer at $70,000 short of $3,000,000. 3 bidders and a crowd of over 200.

Top  Pass Ins

• Brighton, 11 Alverna Grove,  passed in, $3,000,000, no bidders
  A big crowd turned out to have a look at this impressive 7 year old home overlooking parkland at the end of a dead end street….(See more in Auction Reports)
• Balwyn, 26 Metung, passed in, $3,000,000

The New Way to do Business at the Top End - An Abercrombys Private Auction - 11 Bates St Malvern East selling over $6 million – Jeff Gole and Tim Derham

Thursday 22nd March: The Abercromby Private Auction – possibly the new Expressions of Interest. Private Auctions are where a home is advertised usually for a mid week auction and only those who register interest are allowed to attend.

11 Bates St Malvern East was a great example of how it works. A number of pre arranged private inspections are organised during the course of an advertised auction campaign. A few days before the Private Auction (Thursday), all potential buyers register interest and are required to indicate a starting bid. In this case the written starting bid was $5.9 million (I’m not sure what that proves, but anyway).

They are by invitation only (and I saw some people being  turned away at the door). At 11 Bates three parties turned up. Two bid – well I think it was two – the spiel was given by Tim Derham and he declared that there were two pre recorded bids. One bidder asked to see them and she was duly shown the written bids. What surprised me was that she accepted them without asking Tim to point out who the actual written bid was from. But we move on. Anyway this feisty lady tried in all manner of ways to lower the bids (and good on her) until a $50,000 bid was accepted after Tim had cheekily asked for a $200,000 rise (well he tried hey!). The property was eventually passed in to the lady. A deal was done behind closed doors over the magic $6 million mark, post auction. Surprisingly despite the written bid, no-one else bid, including the writer of the bid. Mmmm!

Digressing slightly, this was in our opinion about the right money for this very rare and truly great home, given we figured it was worth $3m for the land and $3m for the home and the rest was going to be emotion. Read our James Home Rating if you wish.

But back to the Private Auction. Not only is it a civil way to conduct proceedings at the Top End but it also probably circumvents the new cooling off period laws – if an auction by invitation only still constitutes a public auction. That’s one for the legal boys.

This is the third of its type we’ve been to over $3m in recent times and all have worked (for the seller). As a buyer the normal rules apply as at a public auction – do your homework on value, have representation to protect your privacy and manage the bidding; and of course have a suitable post auction strategy to prevent the irresistible force of “Slapper” in full voice running you up the flag pole above fair and reasonable.

The more we see the Abercromby guys in action, the more impressed we are with how they do business at the Top End. Yes Tim Derham can hit you between the eyes when you least expect it and Jock can chew your ear off on why a home is worth such and such without necessarily dropping a fact into the conversation (he gets some very big deals over the line); but when you look at their line-up, which includes Rob Vickers Willis and Andrew Harlock, this Top End boutique agency is truly the hired gunslingers (with some morality) who are knocking the Top End around a bit right now. No we don’t get anything from them, but we at James like the way they are doing business right now with the Private Auctions (it’s innovative and its working) – has a relative degree of transparency about it (although you do need pre auction preparation and post auction pass-in skills if you are to give as good as you get – they are working for the vendor not you the buyer) and they are actually pleasant guys (not working for you but pleasant). Jeff Gole is a solid, ethical and experienced addition to the Abercromby family. Liking your work right now boys.

35 Stonnington Off Market - Over $6m

Off Market: 35 Stonnington Place Toorak also Jeff Gole and Tim Derham (they’ve had a good week these old blokes). Went through this off market home about a month ago. Pretty well the Toorak new build formula – big, thoughts of pretension, all the features but lacked a little soul when you lined it up against the calibre of 11 Bates St above. Was around the $6m mark the right money? I feel so and that represents a 25% rise on its last buy price during the GFC. Yes we may be in a market that may fall some more but we also may be in a market that has corrected and will begin to rise again. If you know for sure where we are in the cycle can you let us know please – we agents out here are waiting for that sign from God!

Tuesday 20th March: Another half dozen buys at the $3m+ level this week, with Bayside showing the most consistent activity

• 55 Sussex St Brighton (Jonathan Dixon) finally gets way after beginning its sale campaign with another agent in the stratosphere and selling at what now deemed to be market value.
• 27 Chelsea St (Danielle Martin of Barleys) organises the ink after a long but ultimately successful campaign on a solid block with a home that needed some work.
• 29 Seymour Avenue (Ian Jackson) forever the consummate professional brings two parties together, no not at the initial courageous $5m+ ask; but at the still pretty impressive mid $4 million mark. With land being bought in the early $2m’s a few years ago; holding costs and a pretty solid build ( lift, basement and other features) the buy, build and sell quick is not proving to be the absolute goldmine it once was – but nobody’s saying this was not an acceptable result – just tight.

Monday 19th March: Reprinted from The Weekly Review – “The market can be so fickle at the top end”

So you’ve heard there’s a bit of life at the Top of the Top End – that is the $3 million price bracket. Is it true? Well, yes and no.

After taking forever to get out of the blocks in 2012, the starting gun finally seems to have fired for the $3 million plus market. But the big question in this Olympic year is whether this is a false start or the beginning of some sustained running.

The thing is, that at this price level markets are very fickle and rise and fall quite dramatically within short periods of time. Its sub markets, such as land only or trophy homes or new builds, go up and down with even more elasticity, as demand for these is far more variable than for say a median priced inner suburban home.

Even so, the Top End can have some oomph even while operating a lower price level. It’s a bit like a footy team that is outside the top eight and then gets it act together to make a run at the eight, even if it may not be operating at the levels of the top four.

So where are we now in Mid March 2012 in the Bayside and Inner East Market above $3million?

The current market does have some oomph but it is nothing like the halcyon high turnover days of 2007 and 2010. While there is some good stock on offer, there is also plenty of rubbish. Also worth remembering is that we saw signs of life like this at around the same time in 2011, only to then see momentum die away after Easter. The market did come up for some air in September but then it sank again for the rest of 2011 (except for one or two notable exceptions).

Last year was a classic stalemate market – with many vendors barking orders down to their agents and many buyers looking up at the prize, offering a limp handshake and then walking away unsatisfied when it wasn’t taken up.

So far this year things seem a bit more lively. When pushed some buyers are putting in a second effort, helping to push some prices up. Sellers seem more prepared to meet the market rather than sticking stubbornly to their asking prices as they did last year. However, this does not add up to uniformly increasing prices. In fact a number of homes have transacted at lower prices than the previous peaks or when they last sold.

Let’s get specific

What has been selling?

• Hawthorn East, 2 Buley St, Jason Scillio (Kay & Burton), Sold after auction above $3,700,000, 2 bidders:
• Sandringham, 47-49 Victoria St (Julian Augustini) – Big parcel of land, on the market since late last year and sold in the mid $3 millions – a solid result.
• Camberwell, 19 Waterloo, (Rob Vickers-Willis, Greg Toogood) Bought under the hammer in front of a crowd of 80 people. Bidding opened at $2,700,000. On market at $3 million. 4 Bidders

What has been selling, but at lower than previous levels?

• Hawthorn, 33 Kooyongkoot Road (Tim Picken and Scott Patterson) – A huge block (2800sqm) in THE street on the crest of Scotch Hill. Sold for around the quote price of $8 million, lower than it sold for in the 2007 peak. This was a good sale just at lower levels.
• Malvern, 9 Woodmason St, (Jeremy Fox), Sold after auction, above $3,530,000, with 3 bidders. This was only bought a few years ago and we believe at a higher price. This was a good sale just at lower levels.
• Brighton, 47 Champion St (Ian Jackson) – Had been on the market (with another agent) for an eternity, considering its quality, with an asking price initially over $3.5m – Bought mid week for we believe just under $3m. This was a good sale just at lower levels.

What has not sold at auction?

• East Melbourne, 125 Gipps St – passed-in $3,850,000
• Williamstown, 27 The Strand – passed-in $3,000,000
• Toorak, 24 Heyington – passed-in $2,900,000

And there are plenty more of these out there, as you’ll notice if you do a search on homes over $2.5 million on any real estate portal. Last time we did that, up came 250 homes, which should tell you that despite a dozen or so buys/sells in the last week there are still many “wannabe” sellers out there who may not have got their pricing correct.

19 Waterloo Camberwell hits $3,045,000 in a Rob Vickers-Willis mid week auction

Thursday March 8th – Camberwell, 19 Waterloo, (Rob Vickers-Willis, Greg Toogood) Bought under the hammer in front of a crowd of 80 people. Bidding opened at $2,700,000. On market at $3,000,000. 4 Bidders (Architect Adam Auction Report)

James Home Rating 810/1000: 19 Waterloo is a very good property, and one that which should defy any  negative market conditions  as  it is a unique offering . We see this type of property only about six times a year and,  if vendor expectations are reasonable and the agent manages the campaign well, then a strong result generally comes about….. (see James Home Rating for full details)

Wednesday March 7th – Hawthorn, 33 Kooyongkoot Road (Tim Picken and Scott Patterson) – the big one on Scotch Hill – 2800sqm in THE street on the crest of the hill was bought today for we believe around the quote price of $8,000,000. This shows their is a market for sensibly priced Top End homes – meaning it had a lower quote than what it was last bought for in the 2007 peak. James Home Rating 752/1000 – see rating for full details.

64 Sutherland Road Armadale – (Jock Langley) – Inner city larger terrace home was bought in a private negotiation and 16 Monomeath Avenue Canterbury (Doug McLauchlan) which passed in on Saturday for $4,700,000 was cleaned up in post auction negotiations for an undisclosed amount – the quote was $5,000,000 plus.

Biggest Sale of 2012 so far 33 Kooyongkoot

Tuesday March 6th – Kay and Burton Trifecta

• Toorak, 46 Canberra Road, Michael Armstrong and Ross Savas – bought before auction around $4 million.
• Camberwell, 69 Broadway, Michael Armstrong and Ross Savas – was quoted between $6,000,000 and $7,000,000 and had been on the market since last year with another agent and we believe was sold in the last day or two for an undisclosed amount.
• Portsea, 3831 Point Nepean Road – Liz Jensen, Kay and Burton, $3,200,000 – bought before auction.

Hawthorn East, 2 Buley, Jason Scillio, Bought After, Over $3,700,000. 2 bidders

March 3rd: We had the first signs of life in the Inner East this weekend and it now seems the Bayside Top End may be dragging itself out of its Summer slumber. After last week’s Sandringham Top End action, we saw sales this week at:

• Brighton, 192 Church St (Ian Jackson) – On market for some time at over $4m – Bought mid week just shy of that
• Brighton, 47 Champion St (Ian Jackson) – On market (with another agent) for an eternity, considering its quality, with an asking initially over $3.5m – Bought mid week for just under $3m.

Biggest Auctions:

• Hawthorn East, 2 Buley St, Jason Scillio (Kay & Burton), after auction above $3,700,000, 2 bidders: Jason Scillio was our master of ceremonies here and he led the way strongly and professionally, politely refusing low increment bids and keeping the auction moving along smoothly and quickly…(see more in Auction Reports)
• Malvern, 9 Woodmason St, Jeremy Fox (RT Edgar), after auction, above $3,530,000, 3 bidders: Interested to see how this recently on the market and sold quality home goes at this indoor auction in front of crowd of around 40…(see more in Auction Reports)
• Toorak, 33 Evans Court, Gowan Stubbings, After Auction, around $3,400,000, 1 bidder: This beautifully presented property attracted a sizeable crowd on a gloomy day. An opening bid from the crowd of $3,260,000 was trumped by auctioneer Gowan Stubbings ..(see more in Auction Reports)
• Brighton, 3 Tennyson St, Leigh Hallamore (Buxton), under the hammer, $3,270,000, 3 bidders: Indoor auctions aren’t always that exciting, but this bucked the trend and was fast paced, entertaining and high energy all rolled in to one…(see more in Auction Reports)
• Brighton, 19 St Ninians Rd, Nick Johnstone (Nick Johnstone), after auction, $3,150,000, 1 bidder: The loud chatter of the crowd, with umbrellas in hand, who stood in a series of small huddles, made the weather seem much less dreary….(see more in Auction Reports)
• Fitzroy, 112 McKean St with Shayne Mooney of Nelson Alexander – just over $3million

Biggest Pass-Ins:

• Canterbury, 16 Monomeath Ave, Doug McLauchlan (Marshall White), $4,700,000, no bidders: Outside, and under a substantial porch, a crowd of 80 gathered. Doug McLauchlan opened with a vendor bid of $4,500,000, adding another at $4,600,000…(see more in Auction Reports)
• Albert Park, 79 Beaconsfield Parade, Geoff Cayzer, $3,300,000
• Elwood, 8 Dickens St, Marshall Rushford (Hocking Stuart), $2,950,000,  2 bidders: This great old dame attracted a lot of curious bystanders – even (I was told) a former owner of this amazing old mansion, who had come along to see just how much it was worth in today’s market…..(see more in Auction Reports

However, there is still a lot of property at this price level on the market in Bayside and the Inner East that is simply sitting there doing nothing.

Overall the $3M+ market is seen by optimists as treading water and by realists as still edging backwards.

BRIGHTON, 5 Bemmersyde Ave; Nick Johnstone (JP Dixon) is the picture of concentration as he searches for a bidder. Passed in $1,900,000, but bought after for an undisclosed amount.

Key Points:

Two Big Sales this week away from the auctions:

• Brighton 179 New Street – Chris Carrington of Buxton -  close to $5,000,000
• Brighton 5 Mulgoa Street – Kay and Burton – over $4,500,000

Crowd numbers are down across the board in Bayside, averaging at around 30. It could be the weather.

Properties are still selling. The data shows 171 properties over $1m have sold this year, but only 83 at auction. That’s less than half.  A recent Herald Sun article (by John Dagge – Sunday Herald Sun , April 17, 2011) indicated that Beaumaris had clearance rates at 35% for the year.  As a buyer that means you need multiple bidding and dealing strategies. Click on the Big Issue video for some tips

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Now back to the market – Future Stock:

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

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

Other agent comments:

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

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

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

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

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

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

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

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

A couple of strong results today:

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

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

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

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

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

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

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

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

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

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

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

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

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

Key Points:

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

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

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

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

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

Some interesting results to finish off the month:

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

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

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

• 

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

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

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

Kooyong – 711 Toorak – $3,190,000

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

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

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

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

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

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

Continuing with February Sales:

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

New and old Brightonians like to buy New in Brighton

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

This type of offering sold well over Summer

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Bayside – Overall Clearance Rate solid for Brighton – 77%

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

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

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

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

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

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

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

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

We Only Buy Homes

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

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

A few of the biggies that were bought

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

Some of the biggies that missed the mark

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

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

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

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

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

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

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

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

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

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

Kooyong – 711 Toorak – $3,190,000

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

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

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

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

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

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

Continuing with February Sales:

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

New and old Brightonians like to buy New in Brighton

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

This type of offering sold well over Summer

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

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

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

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

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

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

Welcome to Million Dollar Melbourne in 2011

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

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

What’s been happening so far in 2011?

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

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

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

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

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

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

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

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

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

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

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

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

CAV slackens off on Conflict Of Interest issue

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

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

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

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

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

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

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

Buy Well.

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.

Some of our buyer prayers have been answered

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

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

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

This Week’s Highlights:

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

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

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

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

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

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

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

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

Special Report on the $3m Market

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

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

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

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

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

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

Agent Comments on the current $3m+ market

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

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

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

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

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

Reported Results:

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

September Executive Summary:

Demand: Solid and increasing

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

Supply: New Stock Low

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

Price: Firming

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Malvern 24 Somers: Jeremy Fox of RT Edgar: Bought for $6,160,000 under the hammer: 3 bidders: Crowd of 90.

Special Report on the $3m market: The $3m+ is back, after its self induced May hiccup which lead to a very quiet winter.

There have been over 50 buys in the month of September at this level and the buyers are coming from all quarters. Lets 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 on land sizes over 1000 square metres  – two were post auction (eg after a pass-in) and one was off market (Black St Brighton). However the interesting thing was the buyer profile. One was a change of life family; one had a growing family and needed space and one was an expat family returning from overseas. If you look at our client lists this is a fairly accurate representation of whom we are looking for. In the last case – expats returning from overseas – Brighton high end agent Peter Bourbaud thinks “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, we conducted very little in business terms last year for expats, however there has been a distinct pick up in action from expats returning home in 2010.

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 these charts below (using 2007 to 2010 VG, REIV and James Databases) of some value as they help to show how the overall $3m+ market works.

• The two powerhouse $3m+ suburbs are Brighton and Toorak (see 2009 results graphed below); however they behave quiet differently from each other (see median graph). But 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 you pay top dollar and 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 eg sub $3m.

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

Agent Comments on the $3m+ market

• “Prior to the school holiday period there was some renewed strength in $3m+ market due to stabilisation of things after the election and 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 buy October will be a strong months of sales.” Andrew Hayne of Marshall White Malvern
• “The 3 mill plus market is strong, we are expecting a big finish to spring in the 3 plus 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 my busiest auction sign up day for me in 10 years”

We only buy homes

Crowd moving into position at 49 Harcourt St Hawthorn East - Bought Afterwards in excess of $7.2million. James Tostevin of Marshall White.

Another strong (well stronger than Winter) fortnight for auctions and private sales over $3m. Rather than wax lyrical lets look at some facts. See below for results, reports, ratings and analysis.

42 Wattle Valley Road Canterbury: Richard Winneke of Jellis Craig

Full Auction Report: Click here
http://www.marketnews.com.au/auction-reviews/8807/42-Wattle_Valley-Road-CANTERBURY

Auctioneer Jeremy Fox presiding in front of a crowd of 90 people at 24 Somers Ave Malvern. On the market at $5,650,000 and selling strongly under the hammer with Bidderman at 3.

Full Auction Report click here:
http://www.marketnews.com.au/auction-reviews/8705/24-Somers-Avenue-MALVERN

4 Forrest Court Toorak: Peter Kudelka Kay and Burton

Full Auction Report: Click here
http://www.marketnews.com.au/auction-reviews/8829/4-Forrest-Court-TOORAK

49 Harcourt Hawthorn East: Sold After in excess of $7,200,000

Full Auction Report click here:
http://www.james.net.au/rating/49-Harcourt-Street-HAWTHORN_EAST

1 Myamyn St Armadale: Andrew Macmillan of Benmac: $3,215,000: 2 bidders

Full Auction Report click here:
http://www.marketnews.com.au/auction-reviews/8670/1-Myamyn-Street-ARMADALE/

6 Head St Brighton: Jeremy Fox of RT Edgar: Around $7,000,000

Full Rating click here:
http://www.james.net.au/rating/6-Head-Street-BRIGHTON

Sold Afterwards in excess of $3,600,000: John Bongiorno: Marshall White: 3 bidders

Full Video Auction Report: Click here
http://www.marketnews.com.au/video/?vid=305

19 Acland St South Yarra: Greg Herman RT Edgar: 4 bidders: Bought under the hammer: $3,600,000

Full Auction Report: Click here
http://www.marketnews.com.au/auction-reviews/6886/19-Acland-Street-SOUTH_YARRA/

44 Elizabeth St Malvern: Gerald Delany and Michael Armstrong of Kay and Burton: Passed In at $3,250,000: 0 bidders

Full Auction Report: Click here
http://www.james.net.au/rating/44-Elizabeth-Street-MALVERN

106 St Georges Rd Toorak: Mike Gibson: Kay and Burton: 0 bidders: Passed In $5,500,000

Full Auction Report: Click here
http://www.marketnews.com.au/auction-reviews/8555/106-St_Georges-Road-TOORAK/

61 North Road Brighton: Nick Johnstone of JP Dixon:

Full Auction Report: Click here
http://www.marketnews.com.au/auction-reviews/7552/61-North-Road-BRIGHTON

22 Tennyson Brighton: JP Dixon - Marcus Gollings. Believed to be in excess of $5,000,000. Private Sale

22 Tennyson St Brighton:

• 16,640sqft/1,546sqm
• floodlit tennis court and
• heated pool
• 5.5 bathroom floorplan
• hydronic heating
• space for six cars including triple garaging behind the two sets of auto-gates.

63 Walpole St Kew: James Tostevin: Marshall White: Believed to be in excess of $3,000,000. Sold Before Auction.

1a Como Toorak: Over $6,000,000 Greg Herman of RT Edgar: Private Sale

Leigh Hallamore (Buxton) didn't have to appeal to the heavens for bidders so it must be an attempt to ward off the rain! 68 Head St, Brighton, 5 bidders, bought under the hammer for $2,255,000

Key Points:

• If you remove the biggest result (68 Head St, Brighton, Leigh Hallamore, Buxton – five bidders, bought under the hammer for $2,255,000) we only had one live bidder at the other 5 auctions we attended.
• However mainstream Brighton and Hampton are performing better than fringe $M+ Bayside such as Beaumaris and Sandringham
• One saving grace is the stock quality is low – the most common James Home Rating on the homes auctioned today was in the 500′s/1000 which is a below average score. See how ratings works: http://www.james.net.au/ratings.php
• Golden Mile beachfront: The big one at the end of Head Street (no 6) was finally bought for around $7,000,000 through Jeremy Fox of RT Edgar. James Rating 822/1000. Check out our full comments and June auction report at http://www.james.net.au/rating/6-Head-Street-BRIGHTON

Analysis: It’s all about overhang – reduce the stales (unsolds) and the market can improve – if the market doesn’t do this and October sees another burst of stock then it will be unpleasant for sellers and good for buyers.

Agent Comments:
Nick Johnstone, JP Dixon, Brighton:“Things have been a bit tough, but as we head in to Spring buyer inquiries have increased and interest overall has increased so you could say that with the onset of Spring, I have seen a turn in the market.”

Sturt Hinton, Kay & Burton, Brighton: “We have had good sales, but there is less stock coming onto the market at the moment for Spring.”

Julian Augustini, Hodges, Sandringham: “There are lower levels of family homes coming on to the market at the moment, and some solid sales as a result.”

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

Clearance Rates & Monitor Table: This week we are highlighting the tale of two cities: Boroondara v Bayside

We Only Buy Homes

Big crowd but not the results Mark Earle (Buxton) and his team were looking for. 31 Tennyson St, Sandringham, passed in $2,300,000. No bidders.

David Oster (Jellis Craig) stands high at 59 Studley Rd, Ivanhoe. The historic property sold under the hammer for $4,300,000. Two bidders and a crowd of around 80.

At 6pm on Saturday the James Million-Dollar-Plus clearance rate was 65% for the 43 auctions we attended. Of those, 15 were bought under the hammer.

Auction numbers were up across the board, but results were very mixed. Fringe $M+ areas such as Moonee Ponds, Bentleigh and Eaglemont performed very well, but Bayside put in an all too familiar poor performance – and Port Melbourne through to Elwood had a bigger shocker than Collingwood. Boroondara was steady as she goes.

Overall we saw strong results this weekend, all things considered.

Bidderman, our Demand Indicator, has increased to nearly 1.9 bidders per auction. This is significant, especially when across the board 3 in 4 auctions have at least one bidder. If Bidderman continues like this we could see a market gaining momentum. Bidderman has been on the up for 3 weeks – if next week it cracks 2 bidders per auction and the predicted September stock levels remain tight, then there is a case for saying the market will improve for sellers. However if this was just an exceptionally good stock week after a non stock week last week (because of the election) and Bidderman falls going forward, then the market is likely to be as “softish” as it has appeared for the past few weeks.

Market: Positive – Maybe?
Last week we said market watchers would move from Stock levels to Demand indicators. Thus we wanted to get out this weekend to see what the election aftermath was doing to the market (if anything).  What we can report to you is that after 43 auctions (drum roll)  …..we’re none the wiser. If anything the demand signs this week were as positive as they have been since June.

This felt like the first up week in around 10 weeks. However not all agents thought that, and if you were a seller in Bayside under $3m you would have said it was faulty to say demand was solid. But sellers over $3m in Brighton would agree there is demand (7 bought last week and counting). Meanwhile Port Phillip was a buyer-free zone – in fact there were less buyers in the whole of Port Phillip than at the one auction we got beaten at in Milverton St Moonee Ponds.

Confused? Well if you were backing horses this weekend at the same success rate we had in picking prices at auctions you would have been walking home before the last race.

Our take on today’s demand is slightly positive compared to previous weeks, but still flukey. Overall there is no doubt about demand being out there and where quality stock is tight the market has some strength e.g. Kew to Ivanhoe. However Bayside is awash with supply choice and homes are only moving if the vendor is very realistic.

Our graph below shows how the 43 auctions we reported on faired.

Highlights

• The $3m+ market is showing some very early glimpses of a possible recovery. But it’s very early days and it may be a false dawn with a few vendors dropping their expectations.
• $4,300,000 in Ivanhoe: 59 Studley Rd, David Auster, Jellis Craig: “Auctioneer David Oster cleverly chose to hold the auction in the elevated gardens with city views – so as to underline the attraction and value of this property. The home itself was unavailable for inspection prior to the auction. A strong opening bid of $3,300,000 opened proceedings and soon another bidder joined in. This two-sided contest elevated the sale price by a cool million dollars to end at $4,300,000. A strong result for the Jellis Craig team.” (Doug Paget)
• $2,485,000 in Kew 16-18 Ridgeway Ave, Richard James, Jellis Craig:
  “This auction had it all – strong confident bidding, multiple vendor referrals, plus the usual clichés and jokes from auctioneer Richard James. Bidding was intense and at times very confusing. As the increments narrowed to $2,500, even the agent lost track of the current offer! The property was bought under the hammer for $2,485,000 to an applauding crowd and an ecstatic mother who rejoiced to her son “We won!”.” (Amy Wong)
• Kew, Hawthorn and, across the freeway, Eaglemont and Ivanhoe continues to be solid. There were 20 bidders at the six $M+ auctions we went to today. All sold with 5 out of 6 selling under the hammer.
• 94 Dendy St Brighton resold today for $250,000 more than its last sale in December 2009. 2 bidders. Miriam Carraro of Hodges.

Some strong results in other $M suburbs.

• 6 Milverton Moonee Ponds – Matt Febey of Nelson Alexander –  5 bidders and bought for $1,502,500, $200,000 more than a strong but fair reserve.
• 4 Susan St Sandringham – Bill Jowett of Buxton – 3 bidders and bought under the hammer for $1,400,000.
• 46 The Esplanade Maribynong - Craig Teal of Brad Teal – Sold before auction – over $2,000,000.

Lowlights

• Only 6 out of 17 sold in Brighton and Brighton East.
• Did the auctioneers even show up in Port Phillip? Did they perhaps print the wrong times? Only 2 out of the 14 homes we were monitoring sold this weekend. Townhouses and apartments did better, with  3 out of 3 selling in Port Melbourne and St Kilda for between $1,015,000 and $1,055,000
• Stonnington was mixed with less than 50% bought; but there was little to get excited about quality-wise.

Agent Question: Has or will the election have any effect on the market?

Steve Burke, Jellis Craig, Hawthorn: “A large number of vendors have waited for the election to be over. Unfortunately, as we know, there has still been no resolution as yet. Those currently selling now have timed it well because there isn’t the usual volume of stock in the Boroondara market for this time of year. Less competition creates a greater concentration of buyers at the auction and higher selling prices on the day. We saw this last weekend at 56 Manningtree Road, Hawthorn where we had 5 bidders: 2 investors and 3 owner-occupiers. We are expecting the Spring market to start later once things have settled down and once the Federal government has been decided – and to continue right through to Christmas.”

Nick Johnstone, JP Dixon, Brighton: “My feeling is it has made a slight impact. It is a bit like being in a church at a wedding and everyone is just waiting for the bride to arrive. Once we have a resolution we will be away.”

Chris Hassall, Buxton, Bentleigh: “Good quality, $1m+ homes, close to amenities, are selling well. There are currently no signs of buyers holding back as a result of the election. The next big test will be the football.”

BidderBuzz Auction of the Day (6 Bidders): 41 Silverdale Road Eaglemont – Stewart Oldmeadow of Miles – Sold Under the Hammer – $1,167,000
“Unfamiliar to this neck of the woods, I found Eaglemont cute as a button! Clearly the crowd of 120 did too. Six bidders kept auctioneer Stewart Oldmeadow on his toes and created a riveting contest. Each time the hammer was about to fall, a new bidder appeared and nudged the price up. Mr Oldmeadow proclaimed that Eaglemont properties turned over only every 21 years on average! Well this auction certainly emphasised the demand level: it was bought for $1,167,000 after a solid half hour auction that included two vendor conferences.” Doug Paget.

Issue: The 3M+ Market

The August Bayside Conundrum: the $2m market is drowning, almost dead – while above $3m it is seemingly breathing again.

Look out for our detailed report on $3m+ sales in August which shows a bit more noise at this price level as deals seemingly come back onto the agenda.

However to put this into perspective: we are a long way off Autumn’s deluge where, for example, in May we saw 47 homes reported as sold over $3m as compared to around just 15 this month.

Why is this little lift happening? Because the buyers are there.

Why now? Our best guess is that the buyers never left, but that we needed some vendor price adjustments on old stock and that this came this last week or so. If this is the case, what we are seeing now may simply be a statistical coincidence as opposed to a market change. But it may also encourage more quality stock to come on, which may give the market a more sustained lift. September is going to be lean for stock due to the election interference at listing time (August) – so October will be the month to see if this market is trending back up or remaining flat. But we are still thinking positive, as the agents are continuing to report enquires from those wanting to sell and Bidderman is looking OK.

Check out our $3m+ State of the Market Report on Monday

Video Auctions: This week we showcase auctions at Foote Street Brighton and First Avenue Kew. Check them out below. These are fast becoming our most popular news pieces.

Agent Videos – This week G-E-R-A-L-D Delany of Kay and Burton goes under the hammer with regards to Quoting and Reserves -check out the agent opinion videos to the right of this article.

Buyer Opinion: Our Negotiation Masterclass series went on hold while we had a quick look at a Hung Spring – the Caretaker Mode Market. On Wednesday we return to negotiation with an article on ‘Mindset’.

We Only Buy Homes

Geoff Hall (Noel Jones) in action at 35 Hosken St, Balwyn North. Two bidders, passed in at $1,600,000 and bought afterwards.