What goes around comes around – well, maybe: 61-63 Alfred St, Kew is re-offered to the market (Richard James, Jellis Craig), but we await a result. Passed in, $5,300,000, 2 bidders

At 6pm on Saturday, the James Clearance Rate for $M+ was 55% on the 31 auctions we attended, down on last week. The Weekly Review Bidderman, our demand indicator, was steady at 1.6.

Market Summary:

From the results over the past few weeks, it could be easy to conclude that the market is a bit all over the place – up one week, down the next.  But we don’t believe that the market is as inconsistent as it may appear. It’s just very picky at the moment when it comes to stock and price.

Before Easter we had good stock and we had vendors prepared to sell at market price. The result was solid clearance rates. After Easter things got quiet again – was it was because of the economic news or was it the lack of quality stock? Things improved last weekend when we saw some solid results across the board on quality market priced stock. And then this weekend we were back to slightly weaker clearance rates. Why?

We believe the inconsistency really is down to stock quality and seller pricing.

Two very public cases this weekend demonstrate why:

61-63 Alfred St, Kew (Richard James) – This was a huge 2300 sqm block that sold under the hammer with 6 bidders for $4,850,000 in May 2009 in front of a big crowd (see our auction report of the day). This time around another 100 strong crowd saw two bidders fight it out to $5,300,000. But instead of being sold under the hammer, it was passed in. The market has been up and back down since 2009, but overall pretty flat in growth terms between then and now, yet here you have a 10% increase, with nothing done to the home and the home is passed-in. We are not saying the agent acted inappropriately or that the vendor shouldn’t want more. But the thing is, the market will record this as a pass-in, even though all things being equal it was a good result.

6 Caroline St, Hawthorn East (James Tostevin) – This is a good little single fronter investment home. We gave it a James Home Rating of 662/1000 and have bought this type in the street before (2006). In 2010 this sold for just over $1,300,000 at auction and the market has shifted down a little since then on a number of homes – but probably not so much on these types of homes. So even though it passed in at $1,230,000 after 5 bidders – a ‘volcano’ – does this mean the market is a poor one?  The buyers were within 10% of last year’s figure. If the seller wanted to sell today they could have.

Some may look at those pass-ins and see a market in trouble due to no sales. Yet there were 7 bidders, and a pass-in price not too far away from the previous sale prices.

We think the market is an active and efficient one at the moment, especially in Inner Melbourne.

Yes, there is weak bidder interest for overpriced and/or low quality offerings. But there is strong bidder interest on well priced and quality homes – sometimes the level of that interest doesn’t quite match the expectations of the vendor.

Stock levels are historically low (and nothing looks like changing any time soon) and this is helping keep demand tighter and prices firmer than they otherwise might be if the current bidders were spread over a wider array of stock. BUT the market is doing most of what is asked of it.

Footnote: We were out at Bradleys Lane Warrandyte this weekend purchasing a $M home at a public auction. The agents were Chris Chapman of Fletchers and Ian Reid. They quoted the home sensibly to begin with, they then had an offer above their range mid campaign and consequently lifted their buyer range to incorporate that. At auction they had a great turnout and with 3 bidders the home was pushed over the quote and the home was put on the market when asked. A great result was achieved for the seller and the buyer. Isn’t that how auctions should work?

A big grin even though there were no bidders. Michael Nolan (Noel Jones) at 37 Mont Albert Rd, Canterbury, passed in, $1,800,000

• Canterbury, 35 Monomeath Ave, Doug McLauchlan (Marshall White) passed in and bought afterwards, $4,200,000+, no bidders
  The weather was still and the crowd was strong at this auction – with about 100 people in attendance…(See More in Auction Reports)
• Sandringham, 66 Victoria St, James Paynter (Hodges), under the hammer, $3,500,000, 3 bidders
  An amazing Sandringham house in a popular street, and a decent sized crowd of around 50 had turned up to see what would happen at auction on Saturday…(See More in Auction Reports)
• Prahran, 15 Irving Ave, Tom McCarthy (Biggin & Scott), under the hammer, $2,710,000, 2 bidders
  A landmark property on a magnificent allotment of land, practically a “farm for Prahran” were the passionate opening words of auctioneer Tom McCarthy to the gathered group of 70…(See More in Auction Reports)
• Canterbury, 31 Rubens Grove, Mark Dayman (Marshall White), under the hammer, $2,300,000, 3 bidders
  $2,000,000 was the opening bid called out the very moment auctioneer Mark Dayman finished the introduction…(See More in Auction Reports)

• Hawthorn East, 6 Caroline St, James Tostevin (Marshall White), passed in, $1,230,000, 5 bidders
  The light morning drizzle paused briefly and allowed auctioneer James Tostevin to hold the auction outside…(See More in Auction Reports)
• Middle Park, 139 Mills St, David Lack (Biggin & Scott), under the hammer, $1,180,000, 4 bidders
  Auctioneer David Lack said this was a property with multiple options and had the beach so close you could feel the sand between your toes…(See More in Auction Reports)
• Canterbury, 31 Rubens Grove, Mark Dayman (Marshall White), under the hammer, $2,300,000, 3 bidders
  $2,000,000 was the opening bid called out the very moment auctioneer Mark Dayman finished the introduction…(See More in Auction Reports)

• Kew, 61-63 Alfred St,  passed in, $5,300,000, 2 bidders
  “A landmark auction” were the words that auctioneer Richard James used to describe this auction…(See More in Auction Reports)
• Kew, 1 Selbourne Rd, passed in, $3,670,000, 2 bidders
  Landmark Kew property and this auction was well supported by a solid crowd of around 100 people….(See More in Auction Reports)

I reckon we should do this: Scott Patterson (Kay & Burton) sells 162 Mont Albert Rd, Canterbury, under the hammer for $4,166,000, 3 bidders

At 6pm on Saturday, the James Clearance Rate for $M+ was 68% on the 28 auctions we attended.

The Weekly Review Bidderman, our demand indicator, was 1.6 bidders per auction. There are buyers out there for the A graders and well priced B graders.

Market Summary:

We said last week the market was cool and it was. Agents were glum after the Bunny had been and gone. And the Reserve Bank rate cut seemed to worry more rather than it reassured.

But this week was a different story. The pre Easter market zing that seemed lost last week returned when the good stuff came to market. People felt brighter. Auctions were livelier.

There were four strong sales over $4 million. Three of them sold under the hammer with multiple bidders (see below), which reinforced the fact that if a home is good, the price is right and the agent can get it ‘on the market’ then there is a good chance of a sale.

In the $3m range this weekend were a couple of strong sales including 51 Richmond Terrace Richmond (James Tostevin) and 24 Denbigh Road Armadale (John Morrisby) – a cracker of a home but with a neighbour issue.

Even the $2m range, which was as dead as a doornail over the last fortnight, saw some action (7 sales out of the 12 we monitored). Nick Johnstone resold 1 Norwood Brighton for under $3m after it was reported as sold a few weeks ago for over $3m.

Brighton, 144 Cochrane St: The crowds seemed a bit livelier today. Stewart Lopez (Kay & Burton), bought after auction for an undisclosed amount

This weekend’s results answered two questions:

2)      A longer term question – We’ve had a sustained Bidderman at 1.6 and above for most of the year so far, supporting the sense that the 2012 market is in okay shape. Sure there is a bucket load of homes over $3m doing nothing except taking up internet space – but is this the real market? Sellers who have A or B graders, engage a quality agent, market and price correctly are actually selling.

Price

We believe prices are stabilising, but they are still well off the highs of early 2010 in a lot of cases.

At auction those sellers who ask for less than market seem to get above market, while those who ask for above market seem to get less.

Stock

Auction stock levels in May remain unseasonably low by any measure (although there was a stock spurt this week due to vendors aiming to finish their auction campaign before the Queens Birthday weekend). The market looks like averaging around 75 auctions per weekend this May. Traditionally May is one of the strongest months of the year, and historically we have been above 100 and nudging 150 $M+ scheduled auctions per weekend in Inner East and Bayside. This shortage of stock and a solid Bidderman rate points to no significant price drops till Spring (major economic bad news excepted).

‘Round the Grounds

Boroondara: A return to form with three sales under the hammer over $4m  - 64%
Bayside: Mixed offerings – what was expected to sell did and what wasn’t didn’t – 50%
Stonnington: A solid enough weekend at 60%
Port Phillip: The well priced had multiple bidding – 71%

Biggest Auctions:

Toorak, 10 Rathmines St, Jeremy Fox (RT Edgar), after auction, above $4,300,000
Auctioneer Jeremy Fox looked quite regal positioned in front of this imposing property flanked by his support team…(See More in Auction Reports)

Canterbury, 162 Mont Albert Rd, Scott Patterson (Kay & Burton), under the hammer, $4,166,000, 3 bidders
A medium size crowd gathered in the front garden of this home on the Golden Mile…(See More in Auction Reports)

Balwyn, 6-8 Fitzgerald St, Alastair Craig (Jellis Craig),under the hammer, $4,025,000, 2 bidders
The team at Jellis Craig had a reason to smile today, especially Alastair Craig with four of his auctions selling, including this property…(See More in Auction Reports)

Top Bidderman Auctions:

Armadale, 24 Denbigh Rd, John Morrisby (Jellis Craig), after auction for an amount in excess of $3,000,000,  4 bidders
John Morrisby kindly provided us with the following information…(See More in Auction Reports)

Glen Iris, 2 Hillside Ave, Rob Vickers-Willis (Abercromby’s), after auction above $2,225,000, 3 bidders
A crowd of 30 turned up in the sunshine to watch 3 bidders battle it out for this period family home…(See More in Auction Reports)

Middle Park, 359 Danks St, Greg Hocking (Greg Hocking), under the hammer, above $1,970,000, 3 bidders
Around 60 people attended this Middle Park auction, conducted by the affable  Greg Hocking…(See More in Auction Reports)

Top  Pass Ins:

Toorak, 9 Landale Rd, passed in $3,000,000, no bidders
Showing an affinity for round numbers, auctioneer Gowan Stubbings kicked things off with a vendor bid of $3,000,000…(See More in Auction Reports)

Middle Park, 68 Park Rd, passed in $2,850,000, no bidders
A crowd of 60, including a number of young children and dogs, stood widely dispersed in the tree lined street…(See More in Auction Report)

Brighton, 5 Birdwood Ave, passed in $2,800,000, no bidders
The sun shone brightly in the front yard of this Spanish Mission style home in Brighton’s Golden Mile…(See More in Auction Reports)

Auction Manners

Auction behavior is deteriorating with some vendors and agents, while improving with others.

In the last fortnight we have been involved with three auctions where the agents have priced openly and fairly and got the homes on the market, within the ranges quoted and got excellent results. The agents were Greg Hocking, Tim Blackett of Kay and Burton and Tom Aylward of Jellis Craig.

However, we’ve also been involved in two cases where the vendors allowed their agents to give them low quotes and when their property was passed in to us, the old Clayton’s Reserves tricks began again. (This is where the agent gives a much higher reserve price during pass-in negotiations than would have applied during the auction.) We feel that CAV (Consumer Affairs Victoria) should at least look at vendors if they give a Clayton’s reserve outside their clearly stated range. We have not seen CAV at an auction this year – possibly they are undercover, possibly they think the problems of auction quoting and poor vendor behaviour have disappeared.

As well, one agency in Boroondara totally disrespects the highest bidder and the exclusive right to negotiate concept. The practice of dealing with other bidders while not even talking to the highest bidder after a pass-in is unprofessional and against the spirit of the auction. Fewer bidders will try to be the highest bidder if the auctioneer continues to falsely claim that he will treat with the highest bidder at the exclusion of others and then does not. The agent’s excuse is that Chinese people won’t bid at auction and so we must talk to them afterwards. That’s pathetic. Of course Chinese people won’t bid at auction if you keep talking to them after every auction pass-in, you numbskull. This is a top line agency and the auctioneer should know better – he is cheating the system that produces a good income for him.

Buyer Masterclass - Validation and Dealmaking – check out what we have to say in this week’s Buyer Masterclass.

Big crowd, big auction: 35 Broadway, Camberwell, Alastair Craig and Steve Burke (Jellis Craig) bought under the hammer for $3,425,000, with a very strong 6 bidders

At 6pm on Saturday, the James Clearance Rate for the $M+  market was 55% on the 33 auctions we attended.

The Weekly Review Bidderman, our demand indicator, was at 1.6 bidders per auction.

Market Summary: Overall the market continues to show us that well priced quality homes have a very solid following – as you’ll see by our Bidderbuzz and Biggest Auction Reports below, and by the fact that Bidderman remained fairly constant at around 1.6 bidders per auction.

However, there has definitely been some cooling of interest in the last week or so. There have been fewer buyers through opens, slightly glummer agents and lower auction clearance rates. For example, a quick survey of 8 auctions in the $2m to $3m range saw just 2 bought and 6 passed-in. The fact is that this price bracket doesn’t have a lot of exciting new stock right now and the overhang is no better or is overpriced.

But it’s not just this money segment. With the exception of early $1 million family homes there just isn’t the same zing in the air as there was in March.

The big question for market watchers is whether this change is due to buyer sentiment lowering with the economic news and therefore a longer term change. Or whether this change is a temporary one that is simply due to the dearth of quality new stock entering the market right now. At this stage we think its the latter.

Round the Grounds – $M+
Boroondara: Hot in Broadway – the rest quieter at 54%
Port Phillip: All the market can do is sell what’s on offer – 6 out of 7
Stonnington: Not much on offer and not much happening – at 44%
Mmmm Bayside is slipping a bit at 43%

The Godfather is back! G-E-R-A-L-D Delany (Kay & Burton) in form at 39-43 Mayfield Ave, Malvern, bought under the hammer for $7,131,510, 3 bidders

Top Bidderman Auctions:

Camberwell, 1 Water St, James Tostevin (Marshall White), under the hammer, $1,350,000, 6 bidders
Wow! What an auction! Under light drizzle, auctioneer James Tostevin conducted an auction that left the crowd of 60 breathless…(See More in Auction Reports)

Port Melbourne, 405 Nott St, Kaine Lanyon (Marshall White), under the hammer, $1,312,000, 6 bidders
A sea of colourful umbrellas filled the street at this Port Melbourne auction….(See More in Auction Reports)

Hawthorn, 43 Power St, Hamish Tostevin (Marshall White), after auction, $2,100,000, 3 bidders
Hoping to hold the auction in the backyard to showcase the tranquilty of the property, auctioneer Hamish Tostevin was forced to hold the auction indoors due to the persistent rain…(See More in Auction Reports)

Biggest Pass Ins:

Brighton, 10 Kent Ave, passed in, $3,300,000, 2 bidders
Nick Johnstone is re-auctioning this Golden Mile new build after an unsuccessful effort last year in front of a crowd of around 60…(See More in Auction Reports)

Armadale, 20 Royal Crescent, passed in, $2,500,000, no bidders
There is something about Wayne Gillespie designed spaces – they just work well in terms of proportion and functionality, and the extension at 20 Royal Crescent is no different…(See More in Auction Reports)

Prahran, 25 Highbury Grove, passed in, $2,300,000, no bidders
Even the canines were dressed appropriately for this auction…(See More in Auction Reports)

$3M+ Summary: The past couple of weeks have seen a marginal negative change in market sentiment at the Ultra Top End. But we feel it’s important to highlight the 5th sale at around $10 million that took place recently and that confirmed both the Pre Easter market spike and the power of the Kay and Burton Mexican Wave. The latest, a property at 61 Kensington South Yarra, was sold by Andrew Baines (he will need a tax advisor this month!) for more than $13,000,000. The property had something of a chequered past in terms of being on again, off again, sold, then sort of sold, then not sold. As a large landholding so close to the CBD it had positives. But it also had negatives: being near the freeway (noise) and overlooking power lines (visuals). That is what made for an interesting deal – it was a battle of wide opinions. Nonetheless it sold.

That makes a total of five sales in recent weeks at around the $10 million mark. Four were from Kay and Burton and one was from Marshall White.

So, after almost nothing for six months (a Kenley and maybe a Linlithgow excepted), bang – five were gone in a fortnight or so. Obviously buyers and sellers felt better and the K&B agents clearly smelled that. They did their Mexican Wave job well and pre-warned a number of buyers through a whisper campaign of what may happen. And see what happened! As soon as the first domino fell, the agents shouted (quietly) from the roof tops “Told you so” – and that lit the fuse on four more circa $10 million sales.

At times like this, when skilled agents are involved, certain homes appear to be under an irresistible force and deals get done. There is nothing wrong with this. It’s brilliant marketing and it’s what needs to happen to get a number of deals over the line. It’s not all buyers either – sellers are in on the Mexican Wave as well. They hear the whispers, see the results, get told “I told you so” too, and their price dexterity improves as they see real, concrete opportunity floating by.

However now that the early pre-Easter selling season is over, it seems that momentum has been lost again and the buying crowd are refocused on another game.

In the last few weeks the gloss at the Top End has faded a bit. Buyers are not quite as excited about what’s on offer – understandably given there are not a lot of publicly listed new hotties out there. As well some sellers have unwisely misread the recent activity as a market price increase and as such, without thinking, have in many cases priced their homes back into the too hard basket.

There were two strong results this weekend in the $3m+ segment. But overall there was a decided lack of interest in a number of homes in this segment that passed-in.

Malvern, 39-43 Mayfield Ave, Gerald Delany (Kay & Burton), under the hammer, $7,131,510, 3 bidders
It felt like an entourage of Kay & Burton agents in attendance here and it did take a bit to get going due to the wet weather…(See More in Auction Reports)

Camberwell, 35 Broadway, Alastair Craig (Jellis Craig), under the hammer, $3,425,000, 6 bidders
A much anticipated auction this one as the property was a rare offering – an original home with fantastic bones on excellent land size and prized north facing rear…(See More in Auction Reports)

Brighton, 42 Bay St, Jonathan Dixon (JP Dixon), bought after auction for an undisclosed amount above $2,635,000, 2 bidders
Looking forward to seeing Jonathan Dixon auctioning this old English character home on largish land (1220 sqm) at 42 Bay Street Brighton…(See More in Auction Reports)

So will it get any better – is there any more stock on the way?

James Redfern, Marshall White (Armadale): “Stock levels are frustratingly low at the moment and are low for late May and early June. However, the levels are ever so slightly stronger than the same time last year and confidence is creeping back. The low stock levels are currently underpinning the market.”

Stewart Lopez, Kay & Burton (Brighton): “There are quite a few properties coming through ‘off market’ and low key campaigns. Other private sales are being converted to media campaigns, but overall a lack of choice in most ranges.”

John Holdsworth, Hocking Holdsworth (Albert Park): “At this stage, May is looking ok for stock although, compared with recent years , it appears to be well down. May always used to be a very busy month on the run into winter. June, at this stage, seems to be well down due to the normal seasonal down-swing and general lack of confidence amongst potential sellers.”

Alastair Craig, Jellis Craig (Hawthorn): “At this stage we are booking steadily, but we will be down on previous years, which in my opinion will enhance the clearance rate and benefit those who are willing to commit.”

Andrew Stuart, Hocking Stuart (Albert Park): “Stock levels continue to stay at very low levels, and caution exists from both buyers and sellers: Buyers are not confident that prices are on the way up and sellers are reluctant to test the market given the fact that buyers aren’t buying! It’s a bit of a vicious circle – the market needs confidence! (Perhaps some strong leadership from those at the top might help!)

Read this week’s Buyer Masterclass – Validation and Dealmaking

• The Reserve Bank’s interest rate cuts can have  mixed results at the Top End – some deals are closer together others are further apart.
• How do you get validation if you want to do more in the way of due diligence than take the selling agent’s word as gospel?
• How do you negotiate in this market?

In full flight: Danielle Martin (Barleys) at 3/19 Eildon Rd, St Kilda, bought after auction for an undisclosed amount above $1,300,000.

At 6pm on Saturday, the James Clearance Rate for $M+ was 74% on the 23 auctions we attended.

Welcome back after an extended Easter break. As you were probably aware, there has been nothing to report auction wise until this weekend. Even this weekend it hasn’t been much – in terms of numbers anyway.

Overall the market is actually reasonably healthy right now – but this could simply be due to very low new stock levels.

The Weekly Review Bidderman, our demand indicator, was up at 1.7 bidders per auction. With such low stock levels we’re not sure how much we can read into this stat. However, March had good numbers of stock and also ended up with a Bidderman rate at this level, so there may be some substance in it. We have not however published individual council clearance rates in the market wraps this week as the samples were simply too low for meaningful data.

Market Summary: The news of the moment really is the unseasonably low levels  of new stock.

We have always considered around 100 auctions in Bayside and Inner East a solid weekend. May is traditionally a big month for solid weekends. In May 2010, for instance, there were over 1000 sales over $1m recorded across all of Melbourne. But this year the cupboard is decidedly bare, with the next two weeks (the first two weeks of May) showing a paltry 70 scheduled $M+ auctions each weekend in the Inner East and Bayside markets (Melbourne’s $M+ Engine Room).

These numbers are actually a bit of a shock to all in the industry.The word around the traps pre Easter had been a lot more upbeat about stock levels than has proven to be the case.

What does this all mean?

1. Market price has now stabilised on homes that are marketed at market price. It appears that sellers are in a Catch 22 at the moment: if they ask for too much they often don’t get it, but if they don’t ask for too much, they often end up with a good result. Cases in point: while we attended 12 Ferndale Glen Iris (James Redfern see below) and it ran as hotly as we expected, two other auctions had considerably more action than we thought they would at the start of the auction. See reports for 22 Urquhart St Hawthorn (Stuart Evans)  and 29 Mayston Hawthorn East (James Tostevin and Greg Toogood). Vendors were strong but not greedy and we feel they got above their expected result.  Neither of these were great properties – but they weren’t bad either.
2. For the immediate future, with such low stock levels, the market has almost no choice but to hold firm on price on good properties. So despite a significant reduction in discretionary demand (from investors and from families buying on a whim) we now appear below the low water mark to satisfy minimum market demand – that is, buyers who have to buy to put a roof over their family’s head.
3. If you are a family home buyer you may need to adjust your strategy in terms of process and price. Your price thoughts may need to remain flexible as the market is still awash with “unloveds” and the number one rule in good buying, good growth and good investment is to not pay more than market price. BUT at the same time a number of auctions are moving beyond the  conservative price thoughts of many buyers. That means that your processes may need to include stales and pass-ins and off markets as more homes are being exchanged via these methods, particularly the latter. Why are off markets happening if the market is OK? The market is OK but it’s not a universal guarantee when sellers market their home fairly that they will sell it; so a number of sellers are looking to exchange their homes via the off market (no advertising) method of sale to reduce the chance of public pain. But let’s not get too carried away with secret sales – this is a common occurrence at the $3m+ level. However in and around $1m it’s still really the exception rather than the rule.

Question: Do you agree that May is looking a little light (although better than April), and do you think this Winter will be quiet in relation to stock?

Peter Perrignon, Hocking Stuart (Richmond): “May is definitely better than April for numbers. Richmond is much stronger than South Yarra and Toorak and we have 20 auctions booked for May in Richmond. There are no signs that June is going to be busy in either of our offices so I suspect that the winter numbers will be down this year over last year.”

Hamish Tostevin, Marshall White (Hawthorn): “May is a lot stronger than April, due to the Easter school holiday period.  We are definitely back on track in relation to auction numbers, however it’s not the Massive May we all thought. There is no doubt the winter period will be a lot quieter in comparison to what we anticipate for early Spring. However, forecasting ahead, it is our view or hopes that there may well be a late rush at the end of June, prior to the next school holidays (all being well)!!

Jack Bongiorno, Marshall White (Brighton): ” Overall we expect numbers to be much lighter for May than this time last year. However a potential cut in interest rates may inject more confidence in the market. (But) things are looking quiet heading towards Spring.”

Glen Iris, 10 Barina Rd, Karl Fitch (Noel Jones), bought after auction for $1,240,000, 3 bidders

$3M+ Summary: Yes it’s been quieter in April but it hasn’t been as quiet as you think, right at the very Top of the Top.

Last year we had three $3m+ activity spikes – one around Easter, one in September and a small one for two weeks in December. Those spikes featured homes in and around $3m to $7m.

March 2012 was definitely a spike in terms of activity and April has continued in that vein – not so much in terms of numbers (due to the holidays) but in terms of substantial deals.

Worth noting are four recent sales at around the $10 million mark (3 over and 1 just under). What that says is that people are acting. We last saw this level of activity in August last year where $55 million worth of property sold across 11 sales. In some ways the 2012 Easter weekend was just as impressive with 3 and possibly a 4th ultra-quiet sale in South Yarra transacting for over $10 million and another one very close to it.

A quick rundown on some of the biggies:

• Level 39, Royal Domain Tower, 368 St Kilda Road, Melbourne
  Whole floor in excess of 50 squares. Sold by Andrew Baines of Kay and Burton – Over $8,000,000.
• 26 Albany Road Toorak
  Set on grounds totaling approximately 2,476sqm, a championship-size tennis court and indoor/outdoor pool. Sold by Michael Gibson of Kay and Burton. Over $10,000,000. On the market for over a year and offers back and forth saw this home sell in excess for, we believe, $11,000,000.
• 1 Millswyn St South Yarra
  On 2,152sqm approx in South Yarra – yes it’s part commercial but it’s a big piece of residential dirt. Sold by Michael Gibson and Matt Davis of Kay and Burton for over $10,000,000 we believe.
• 21- 23 Kooyoongkoot Road Hawthorn – Sold by Marcus Chiminello of Marshall White. Over $12,000,000
  Tennis court court and pool on 2,788 sqm – just down from another big parcel of land at 33 which sold for around $8,000,000 last month.
• 49 Irving Road Toorak – it’s been on the market longer than Richmond have been trying to win their latest premiership, but it has finally been put away by Jeremy Fox for $5,000,000 on the knocker.
• 7 Maple Grove Toorak - slightly dated home with a tricky floor plan. Sold by Michael Armstrong for over $4,500,000
• 38 Havelock Road Hawthorn East – 1300+ sqm in size, had been on the market for some time with initial quotes in excess of $4 million. Sold by Glen Coutinho of Hocking Stuart for just above the mid $3 millions.
• And the Balwyn Formula is back in vogue (sort of), that is, small land, big new home and big price – with 3 such homes recently sold in the suburb: 57 Citview (Brett Philipp);  31 Elliott (John Bradbury) and 111 Winmalee (Jin Shang). All sold for between $2,800,000 and $3,200,000 with land sizes between 650 and 750 sq metres. Prices are down but activity is improving.
• 79 Beaconsfield Parade Albert Park – the sale was managed by Paul Western of Cayzer Real Estate.   On land of 409m2. Passed in at auction on the 3/03/12 and sold on 4/04/12 in the range of $3.2m to $3.5m

Glen Iris, 12 Ferndale Grove, Growling Jack (Marshall White), under the hammer, $1,625,000, 5 bidders

Biggest Auctions:

Hawthorn East, 29 Mayston St, James Tostevin (Marshall White), under the hammer, $1,965,000, 3 bidders
Edwardian timber home – north facing rear on good land at 600sqm plus…(See More in Auction Reports)

Glen Iris, 12 Ferndale Rd, John Bongiorno, (Marshall White), under the hammer, $1,625,000, 5 bidders
A beautiful summer’s day greets the crowd, around 90, who have rocked up to see how this market litmus test – a lovely renovated, single level, timber period home – will go…(See More in Auction Reports)

Top Bidderman Auctions:

Windsor, 50 Lewisham Rd, Elliot Gill (BenMac), under the hammer, $987,500, 5 bidders
The assembled crowd of 35 stood quietly enjoying the autumn sunshine…(See More in Auction Reports)

Sandringham, 54 Vincent St, Mark Earle (Buxton), under the hammer, $1,253,000, 4 bidders
This was one of the most entertaining auctions I had been to for a while…(See More in Auction Reports)

Top Pass Ins

Middle Park, 328 Danks St, passed in, $3,700,000, no bidders
Perfect autumn day and a perfect house. What more could auctioneer Greg Hocking want…(See More in Auction Reports)

South Melbourne, 153 Nelson Rd, passed in, $2,400,000, no bidders
Auctioneer Andrew Stuart is always passionate about the homes he sells and it came as no surprise when he said “this street out-performs most in the area and in Melbourne…(See More in Auction Reports)

Acknowledgement for Peter Perrignon’s photo from news.com.au (Andrew Henshaw)

It was 'red' everywhere today, with practically everything selling. The Fox aka Jeremy (RT Edgar), 27 Selborne St, Toorak, selling after auction, $3,300,000, 1 bidder

At 6pm on Saturday, the James Clearance Rate for $M+ was 79% on the 34 auctions we attended. On what we covered it was a sizzling result (in terms of activity) and supports the market improvement most have been claiming in 2012. HOWEVER this has happened in five of the previous six years (see chart below) and so we are not saying it’s a new paradigm. What we are saying is the market is doing everything that is being asked of it. And should late April and May activity hold up, then yes the overall market has shifted into new, more positive territory in early 2012.

The Weekly Review Bidderman, our demand indicator, was 1.9 bidders per auction. When you consider the huge increase of stock on offer (this was one of only a handful of Super Saturdays in the last year) it’s a significant number. Interestingly, while there were only 5 volcanoes (4+ bidders) among the 34 auctions we covered, there were also only 6 ducks (no bidders) and two of those ducks sold immediately afterwards.

This indicates a depth and consistency in the bidding – a sign of a healthy market. The “solid market” commentary is also supported by the fact that the week before Labour Day saw a 70% plus James clearance rate as well – also on a very good stock day. In other words, despite our Clearance Rate of this weekend being stronger than other weekends, and stronger than the individual councils we cover, we don’t believe this weekend was a statistical fluke unrepresentative of the market for quality, well priced homes.

Our description of the market is not a future prediction; what we are saying is that right now the market is solid, very solid. If the stats and the street vibes say something different come late April or early May we will report that and any market mood change.

In addition good numbers indicate that selling agents have been getting the right messages out (although some have just been lucky). Overall, the high clearance rates mean agents are doing their job well.

Market Summary:

This weekend was a culmination of a build-up in market strength that has been going on all month. Why?

1. Many buyers feel they can’t wait any longer, especially given that the post Easter market is looking light on for stock.
2. Many sellers have accepted that the market has dropped in price, they can’t see it going up any time soon (in price) and are prepared to sell when offered a fair market price.

However, this is not completely unexpected. And, as you can see below, most years in recent times have had fast starts. It’s what happens after Easter that sets the tone for the year. However, given that April is looking light on for stock and given the strength of demand shown by the very solid Bidderman rate, the market has a good chance of remaining solid.

The big, big question is what will happen after Easter.

Below is a representation on what has happened in previous years in terms of overall price. As you can see, when the Easter Bunny spins the roulette wheel where he (or she) stops on price nobody knows.

Déjà vu – 24 Kingsley St, Camberwell -  this is a case study for the Middle $M+ Market over the last few years, which overall has been an incredible roller coaster but is now roughly where it was in 2007. The home itself hasn’t changed much – it still needs an ensuite and a renovation at the rear. The report below is from our extensive auction and ratings database on quality homes.

24 Kingsley St, Camberwell

James Home Rating August 2009: 720/1000. “Really good street presence and with some planting down the sides will be an even better classic Victorian. Front rooms are impressive however the back needs attention.  Will you over capitalise? – no. A good finished build is $2m plus in this market. Love the street – great width and this is a great area – private – limited traffic and a stone’s throw from Camberwell Junction – train just down the road. Good land. With a good renovation this could rate as high as 850. This is a great long term investment.”

James Control Price August 2009 : Dirt $1,631,700 + Building $400,000 = $2,031,700. We have based our price on land sales at 36 Moorhouse (1.65m) last weekend and 32 Moorhouse St (1.4m land for just under 600 sq m) during the week. Land in the area has risen dramatically in the last few months and this building, while needing a substantial rear renovation, has the makings of a classic Victorian home and therefore has substantial value.

James Auction Report March 2012: Bought After Auction $2,000,000 to $2,100,000. 2 bidders.  Geordie Dixon and Steve Abbott of Jellis Craig. The crowd of around 65 spilled out of the manicured front gardens and into the pretty Camberwell street as autumn leaves fluttered from the trees. Steve looked for an opening bid and got one at $1,600,000. While it was a little on the low side, Steve was happy to accept the offer but quickly tabled a vendor bid of $1,800,000, which was closer to the quoted price of around $2m. Bidding continued with bidder 1 offering strong bids of $25k and a second bidder making $10k bids. Eventually the property was passed in at $2,000,000 to bidder 1, where negotiations began and finished afterwards between that and $2,100,000. (Jen Milligan)

James Auction Report May 2010: Bought After Auction $2,150,000. 2 bidders. Scott Patterson and Richard Winneke of Jellis Craig. A large crowd of 120 gathered under overcast skies on this picturesque street. Auctioneer Scott Patterson was keen for things to get moving opening with a vendor bid of $1,900,000, quickly followed by another at $1,925,000. This stirred two bidders and some steady back and forth bidding took place. The property passed in at $2,100,000 and was bought after for $2,150,000. (Architect Adam)

James Auction Report August 2009: Bought Under the Hammer. $2,000,000. 6 bidders. Jeremy Desmier and Alan Bramich of Fletchers.  Great crowd for a great property, with about 120 people in attendance. Auctioneer Jeremy Desmier did not need to wait long for an opening bid on this Camberwell beauty. The opening bid was $1.2 million. Rapid-fire bidding from six bidders saw this on the market at $1.5 million and the pace continued in the $1.9 million range. Property was sold for an undisclosed figure. (Mal James)

$3M+ Summary: 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 due to buyers not seeing anything of note on the market after Easter. Some notable mid week and off market sales:

• Kooyong 11 Moralla Rd - over $5,000,000. Expressions of Interest still working with Michael Armstrong of Kay and Burton. Below the initial quote but a solid result in this market
• Brighton 13 Halifax St – $3,000,000. At initial quote. Nick Johnstone of Nick Johnstone Real Estate.
• Kew 53 Barnard Gr - Paul Richards of Bekdon Richards for over $6,000,000 earlier this month. Below the initial quote but solid result in this market
• Malvern 8 Harvey St - Justin Long of Marshall White moved on Monday for, we think, over $4 million – We went through it late last year and thought it may take some time to shift – if he has achieved anything over $4m in this market it would be a credit to his persistence and a good result for both parties.
• Brighton, 2a Chelsea St – Sturt Hinton of Kay and Burton got this away after an eternity on the market for an extremely healthy result of $3,600,000 (according to another agent).

Another one has quietly gone in the Gascoigne with Kay and Burton circa $3m price level. And a result on the big one in Boroondara should emerge soon to give some leadership at the Top of the Top End, which has seemed to be lacking till now. (Not trying to be tricky but we do respect privacy when asked.)

As for our company, we have had two recent purchases over $3m. The majority, however, have been in the $2m to $3m range inclduing buys in Hawthorn East (Marshall White), Hawthorn (Jellis Craig), Brighton (Barleys), South Yarra (Hocking Stuart), Kew (Marshall White), St Kilda (Marshall White), Glen Iris (Jellis Craig), Black Rock (CBRE), Brighton East (Thomsons), Elsternwick (Biggin and Scott), Surrey Hills (Jellis Craig) and Balwyn (Kay and Burton) this month.

To keep some perspective if you read our archived $3m+ reports from previous years, you will see the same buoyant activity leading into Easter. When it gets really interesting is after Easter.

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 were passed in. Since then a further two have sold – both at less than the pass-in price. Although the stat is on a small sample it does suggest a 40% clearance rate after a month at this level.

CAMBERWELL, 24 Kingsley St, Steven Abbott (Jellis Craig), after auction, above $2m, 2 bidders

‘Round the Grounds: Market Wrap Headlines

• Boroondara – Many of the sales were right at the lower end of a million and the pass-ins were mostly higher end – 62% on 50+ Auctions
• Stonnington – A drop from last week at 62% but 3 solid sales over $3million
• Bayside – Every one we reported on was bought – 9 from 9 – 70% on all auctions in Bayside
• Port Phillip – Two solid weeks in a row – a 2012 anomaly – 73%

A word from the experts: The market has improved. Which segment has improved the most and which has improved the least?

Justin Long, Marshall White (Armadale): “There is no doubt that vendors, especially in the $1 – $3m range, have become more realistic and, as a result, buyers are responding favourably. In the $5m plus range, there is greater price sensitivity from vendors, especially those not pressed to sell. But even then there is increased activity”

Richard Winneke, Jellis Craig (Hawthorn): “There is a lot of demand for homes in the $1m-$1.5 m range, especially if well positioned (location) and offering 3-4 beds plus 2 bathrooms. Least improved area - the $2.25m plus market is very patchy. The home must be in an A grade street and/ or fully renovated with a good floor plan.”

Nick Johnstone, Nick Johnstone (Brighton): “I believe the good quality family homes with 4 plus bedrooms on 700 sqm in the $1.6 – $3m range are the strongest. The hardest market is apartments, purely because there is so much choice. But the apartments that are well finished are still commanding good prices.”

Biggest Auctions:

Prahran, 4 Grandview Grove, Jeremy Fox (RT Edgar), 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…(See more in Auction Report)

James Home Rating 865/1000 “I found it hard to find fault with this home – it’s 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 northern 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

Malvern, 14 Lysterville Ave, Andrew Hayne (Marshall White), under the hammer, undisclosed over $3,300,000, 5 bidders
A big Super Saturday crowd gathered to see auctioneer Andrew Hayne hold court, quite literally, in the huge backyard of this house…(See more in Auction Reports)

Toorak, 27 Selborne St, Jeremy Fox (RT Edgar), after auction, $3,300,000, 1 bidder
Auctioneer Jeremy Fox began proceedings by accepting an opening bid of $3,100,000. A second bidder elevated the price but not enough to reach reserve…(See more in Auction Reports)

Top Bidderman Auctions:

• Camberwell, 9 Hartwell Hill Rd, Scott Patterson (Kay & Burton), under the hammer, 6 bidders
  One of the first auctions of the day and it was well attended, with over 70 counted in the crowd….(See more in Auction Reports)
• Kew 11 Maxwell St, Hamish Tostevin (Marshall White), under the hammer, $1,875,000, 4 bidders
  No nonsense auction here, in front of around 70 people….(See more in Auction Reports)
• Elsternwick, 4 Prentice St, Bill Stavrakis (Biggin Scott), under the hammer, undisclosed above $1,180,000, 4 bidders
  A crowd of 70 turned out to see this Edwardian sell. Bill Stavrakis looked to the crowd for start where there was a geniune bid of $950,000…(See more in Auction Reports)

Top 3 Pass In:

• Toorak 49 Irving, passed in on a vendor bid at $4,500,000
• Camberwell, 12a Royal Cres, passed in $4,100,000, no bidders
  A very gusty auction which at times silenced auctioneer Scott Patterson but it wasn’t this that provided the biggest challenge rather it was the lack of bidders present….(See more in Auction Reports)
• Toorak, 7 Grong Grong Crt, passed in $2,700,000, no bidders
  Auctioneer Justin Long was on song at 7 Grong Grong! He did an admirable job of selling the features and location of this townhouse but it didn’t strike a chord with the crowd…(See more in Auction Reports)

Buyer Masterclass: How to buy well in this or any market – check out this week’s article!

Footnote: There were around 150 scheduled auctions over $1m in Bayside and Inner East; but a number of them did not reach the magic million mark (sign of the times) and in the end we looked at around 120 auctions – so today was an almost Super Saturday.

Market News now takes three weeks off for school holidays and low stock weeks – little to report auction wise. Although a bit still going on behind the scenes, such as an off market at 38 Sussex St Brighton (Julian Augustini), a ripper mid sized Edwardian in need of a reno,  selling mid week before the formal campaign at mid $2′s; while on the other side a Gascoigne classic and a Scotch Hill beauty did not get acceptable buyers by the completion of the formal part of their campaigns and so the real horse trading begins over Easter to find the right levels.

Don’t eat too much chocolate!

$3,000,000 in McKinnon - Yep McKinnon - well almost, $2,930,000 with 3 bidders. Phillip Kingston and Adam Joske from Gary Peer.

At 6pm on Saturday, the James Clearance Rate for $M+ was 56% on the 32 auctions we attended. However we think that bare statistic understates the quality of the $M+ market, given we included a number of fringe auctions today and that current stock levels are swollen right now. All in all we think it’s a borderline balanced market.

The Weekly Review Bidderman, our demand indicator, was a healthy 1.6 bidders per auction. One in three auctions we covered had three or more bidders. However 1 in 3 auctions were ducks (no bidders) and the other third were somewhere in between.

Market Summary

Decisions are being made again. It’s as simple as that. Both buyers and sellers are making decisions again and as a result market activity has been picking up all month.

Most agents are reporting a good March with good results and this is happening because:

1. Sellers are saying – OK let’s focus on meeting the market rather than getting “my” price.
2. Buyers are saying – let’s buy a home rather than worry about the future.

These assertions have been supported by a number of sales, particularly in the $2m to $4m bracket, over the last few weeks.

Other evidence is the fact that our company has been involved in four more purchases this week, averaging over $2m in Brighton, Hawthorn, South Yarra and Hawthorn East.

Why?

Life goes on. We don’t believe it’s any more complicated than that. Children are still being born, growing up and leaving home.  These things aren’t going to be stopped by the Greek economy – and Melbourne is a healthy place at the Top End to be and in which to own a home in March 2012.

The last fortnight has had limited auction results on low quantity/quality offerings. However this weekend with around 100 auctions $M+ in Inner East and Bayside we have seen the continuing public signs of positivity in the market of late February. Sure, this weekend’s clearance rates weren’t stellar but then the number of auctions were up significantly.

Next Week, the last auction day before Easter, is a Super Saturday with around 150 scheduled auctions over $1m in Inner East and Bayside. This is our first for the year (which just shows how the market has contracted since last year). The market really only has one more hurdle before Spring before we can confidently say that some positive life has returned. That hurdle is the late April to late May market – really the last run before things quieten down for Winter.

Price

Yes, there is increased activity but if you think that necessarily means prices have increased then as a buyer you may be overpaying and if you are a seller you may not be selling. Increased activity in early 2012 means more buyers and sellers agreeing on price and those agreements are largely occurring because sellers are meeting the market.

$1m to $2m – This market is now officially solid on any A grader or reasonably priced B grader. And prices may even be firming a tad. Look at the Highbury Grove Prahran (Andrew McCann) auction report, where we saw another strong auction on the back of a big price next door a few weeks ago.

$2m to $4m – This market has had a real lift in activity this month. A few stales (long term unsolds) have been cleaned up, such as 4 Hampton Grove Camberwell (James Redfern). This property went to auction last year and three bidders took it to $2.4m. The home was then  offered at $2.75 million post auction, even though $2.4 million seemed the right number. But the vendor stuck to his guns and sold mid week to a new buyer for $2.55 million (hats off to him). We think the reason this price segment is doing well is prices are coming back and vendors are meeting the market. But it’s not all one way.

$5m and above – This market has had a smattering of action, with a couple of $6m plus sales through Abercrombys this week and a huge one on the Hawthorn Horizon seemingly wrapped up. But that is about it. We have been through a couple of quiet $10m+ homes mid week (off market) and the big question is whether these and a few others sneaking onto the market will actually get some real buyers through. Our opinion is that the market is very iffy on price where the air is thin and that those floating the big numbers will remain owners rather than sellers. But we’ve been wrong before.

Risk

This is something many buyers don’t take into the equation when buying. However this market must surely be showing observant buyers that risk is just as important an element in home buying as cash flow and capital growth. And while people think we have been giving Black Rock a hard time in recent times it is simply to show what can happen to a great but fringe suburb when the market starts to feel pain. We covered 3 auctions in the area this weekend – all good sized circa 1000 sqm blocks.

1. 21 Iluka St, passed in, $1,925,000, no bidders
2. 40 Middleton St, passed in, $1,800,000, no bidders
3. 48 Second St, passed in, $1,200,000, no bidders

This is a graphical representation of how the boom markets of 2007 and 2009 worked, compared to the two tiered normal markets of 2011 and 2012.

$3M+ Summary
It’s neck and neck for the strongest areas this month: in Brighton 7 properties have sold for over $3m, in Hawthorn, Kew and Canterbury there were also 7 and in Toorak 6 have sold for the month so far.

• East Melbourne, 125 Gipps St, the newly married Nathan Waterson should be able to pay for his wedding with this private sale at slightly below $4 million. This was a great terrace home and a good result. But it was below the initial asking price and it took a fair while for the vendors to come into line. Next door’s ask now seems even more courageous than when we first heard it. But I have had the taste of humble pie this month once or twice 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 price level, is he not the young Brains on the 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.

The Abercrombys 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 were organised during the course of an advertised auction campaign. A few days before (Thursday) all potential buyers registered interest and were required to indicate a starting bid. In this case $5.9 million was the written starting bid (I’m not sure what that proves, but anyway).

Read our full report on Private Auctions and all results in our $3m+ plus section.

A word from the experts: When will the market start up after Easter, as we have little new stock this week?

Alastair Craig, Jellis Craig (Hawthorn): Traditionally Easter and the school holidays are always a quieter time for transacting family homes, whereas apartments, units and townhouses sale activity remains fairly constant. In our experience “the early bird catches the worm” meaning that people who are ready to place their home on the market, with the first ad appearing on the 14^th or 21^st April, and therefore auction on the 5^th or 12^th May, will experience less competition. In most cases this relates to a stronger price. In my opinion 26^th May and 2^nd June will be extremely busy as they are the last two prime Saturdays prior to winter and School Holidays.

Iain Carmichael, BenMac (Armadale): Two schools of thought on this one:  Most people have been happy to carry the Easter Weekend in weeks two and three of their four week campaigns and  auction on Saturdays 14 and 21 April; whereas others are choosing to give Easter a wide berth and select Saturday 5 May and beyond so that all weekend Open Houses fall after Easter. There will be a large number of auctions held in May so sellers will have to weigh up the whether a June date is preferable.

Greg Hocking, Greg Hocking (Albert Park): Supply is tight and as such propping up the market to a degree. The market is quite robust for properties up to $1m but as you approach $2m and above the market is patchy. People are seeing opportunities to move up the food chain as they are realizing discounts of 10 to 15% on the new purchase.

Brighton, 8 St Ninians Crt, David Hart (Buxton), under the hammer, $4,900,000, 3 bidders

‘Round the Grounds:

• Stonnington – Nothing that special on sale but all you can do is sell them – 80%
• Boroondara – Big numbers on offer so 66% is pretty solid
• Bayside – Sandringham is on fire over the last month and Brighton and Hampton not bad either – the rest so/so – 61%
• Port Phillip – Stock is still very low so 75% maybe a bit flattering

Biggest Auctions:

Brighton, 8 St Ninians Crt, David Hart (Buxton), under the hammer, $4,900,000, 3 bidders
Don’t Brighton people like the smell of a mortgagee auction in the afternoon and they have come in droves at the smell of blood – and when I say droves I mean that…(See more in Auction Reports)

McKinnon, 41 Rose St, Phillip Kingston (Gary Peer), under the hammer, $2,930,000, 3 bidders
I’ve never seen so many people at an auction before! Normally when I go to an auction there is a car park with 200 meters of the property and today, when I couldn’t even turn into the street, I suspected that this wasn’t going to be a normal auction…(See more in Auction Reports)

Toorak, 9 Fairbairn Rd, Gowan Stubbings (Kay & Burton), under the hammer, $2,505,000, 3 bidders
Gowan ‘Hollywood’ Stubbings leads off proceedings for this beautiful mid-sized Victorian in front of a crowd of about 40…(See more in Auction Reports)

Top Bidderman Auctions:

Hawthorn East, 39 Auburn Grove,  Glen Coutinho (Hocking Stuart), under the hammer, $1,520,000, 5 bidders
Like a conductor is to his musicians, so Glen Coutinho was to his bidders as he skilfully orchestrated 5 of them in a furious battle…(See more in Auction Reports)

Hawthorn East, 7 Station St, Steve Abbott (Jellis Craig), under the hammer, undisclosed, 5 bidders
A real buzz to this auction and the weather was pleasant as auctioneer Steven Abbott conducted proceedings in his usual no-nonsense manner in front of over 100 people…(See more in Auction Reports)

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

Bentleigh, 15 Vickery St, Craig Williamson (Buxton), bought after auction, $1,200,000, 3 bidders

At 6pm on Saturday, the James Clearance Rate for $M+ was 57% on the 23 auctions we attended. That figure represented a dip down from last week, but the stock quality was not up to what we have been seeing lately.

The Weekly Review Bidderman, our demand indicator, was 1.3 bidders per auction. 1 in 3 homes were ducks (no bidder auctions) – a substantial change from two weeks ago. However, again this may have been simply a reflection of this weekend’s overall lower quality.

The market away from auctions is not as quiet as these stats may indicate. As a company we have bought six homes in the last fortnight (Kew, Brighton, Glen Iris, Black Rock, Balwyn and St Kilda)  and the overall $3m+ market has had a number of substantial sales. Our full report on the current state of the $3m+ market is in this week’s The Weekly Review and will be republished in our $3m+ report section at week’s end.

With only 50 auctions at $M+ in Bayside and Inner East, this weekend we are giving you a Marketnews LITE version. The majority of them were below $2 million and a number were, shall we say, less than exciting offerings.

Next weekend is a solid one, stock-wise, with double the number of this weekend’s scheduled auctions at around 100. The pre Easter weekend of March 31 sees our first $M+ Super Saturday for 2012 with the number of auctions approaching the magic 150 mark.

Many parts of the market are still clearly operating at lower price levels than in previous years. The Land Only segment is a case in point. For instance we saw 19 Ebden Black Rock pass in this weekend for $1,525,000 after having changed hands for almost $2,000,000 a few years ago.  This is a good spot. But Black Rock, like Balwyn North and Bentleigh East are fringe suburbs and fringe suburbs are seeing Top End land prices drop and drop at faster rates than Melbourne’s Jewels such as Brighton, Hawthorn and Toorak. This is a normal market cyclical phenomenon where fringe land prices increase more dramatically (percentage wise) in rising markets but also fall at a faster percentage rate in tougher markets.

So despite the uplift in activity in the last month – and there really has been an uplift in activity, the ‘record price’ is still clearly the  exception rather than the norm in early 2012.

Elsternwick, 29 Orrong Rd, Bill Stavrakis (Biggin & Scott), under the hammer, $2,100,000, 4 bidders

Below is a sample of what we covered in our Auction Reports this weekend.

Elsternwick, 29 Orrong Rd, Bill Stavrakis (Biggin & Scott), under the hammer, $2,100,000, 4 bidders
Attending the auction at 29 Orrong Road in Elsternwick was like returning to the good old days of the property market…(See more in Auction Reports)

Malvern East, 94 Tooronga Rd, Karl Fitch (Noel Jones), under the hammer, $1,250,000, 5 bidders
We all love the theatre of auctions and this one didn’t disappoint, thanks to five bidders vying for the property!…(See more in Auction Reports)

Toorak, 101 Canterbury Rd, Tim Derham (Abercromby’s), under the hammer, $1,851,000, 4 bidders
“A blue chip piece of real estate in the heart of Toorak in a magnificent and convenient location”, were the passionate words of Tim Derham in his preamble, in front of the assembled group of 40…(See more in Auction Reports)

Malvern East, 20 Coppin St, Iain Carmichael (BenMac), bought after, $2,550,000, no bidders
A widely dispersed group of 60, many of whom were neighbours, gathered to witness this Malvern East auction…(See more in Auction Reports)

Balwyn, 13 Palmer Ave, Steve Abbott (Jellis Craig), passed in, $2,400,000, no bidders
A nice-sized crowd and the sun out and shining, what more could auctioneer Steven Abbott want…(See more in Auction Reports)

Bentleigh, 15 Vickery St, Craig Williamson (Buxton), after auction, $1,200,000, 3 bidders
Auctioneer Craig Williamson did not waste any time mentioning to the crowd that earlier in the day his agency had sold three properties that had a combined total of eighteen bidders…(See more in Auction Reports)

Looking forward to next week and giving you our full analysis on where the market is heading @ $M+

Like father like son. Learning the auction business. A Melbourne tradition. 38 Lambeth Ave, Armadale, under the hammer, $2,569,000, 4 bidders. John Bongiorno (Marshall White).

At 6pm on Saturday, the James Clearance Rate for $M+ was 74% on the 34 auctions we attended. We are now well and truly in the realm of a balanced market.

The Weekly Review Bidderman, our demand indicator, was 1.8 bidders per auction – a significant rise on the last two weeks.

Stock levels were fairly solid again this weekend and are looking to be healthy through most of March. So any demand stats coming in, are off a healthy base.

Market Summary:

Analysing the above data more closely, 25% of the auctions had 3 or more bidders while only 10% were ducks (i.e. no bidder auctions). These are the sort of stats that provide early indications of a strengthening market. Should this demand be sustained on the solid auction numbers in the next few weeks leading up to Easter, then it’s safe to say for now that the $M+ market, as a whole, has performed a lot better than most expected and that we may be in fact be in a stabilising price phase.

However if we have a repeat of 2011, where demand fell away after a fairly positive pre Labour Day 2011 market, then all we are seeing now is a bit of price spiking.

As we keep saying, it is early days. But the numbers are substantial and if the clearance rates continue to improve and the bidder numbers continue to increase then in time we could see an end to price falls and prices could in time begin to climb again (the current market has been trending downwards since Anzac Day 2010).

Our focus for the above statements is the $1m to $2m segment. We are still not seeing any significant positive momentum in the $3m plus market. Sure, agents are claiming they’re getting offers on properties and yes, some long term stales are being cleaned up. But they are at lower prices and happening when the vendor is meeting the market not the other way around. So before we acknowledge any uniform improvement across all segments of the market, we need to see the Top level perform in greater numbers and a lot more consistently.

Do all the good deals have to drag out?
Not necessarily. You can make it hard for yourself and the other side if you want, but good negotiations aren’t necessarily long, unpleasant and drawn out. Indeed, why wouldn’t you negotiate in a timely manner if it is right for both parties?

As a case in point, we were involved in a Bayside $M+ property purchase mid week that had been sitting around since before Xmas. With the help of the selling agent we were able to conclude a mutually acceptable agreement in a few hours. Both the buying and the selling sides had done their due diligence and were ready to deal – and both sides wanted a satisfactory result. So in the space of a few hours, a couple of coffees and several phone calls, the basis of an agreement was reached and then signed off on.

There are many deals out there in ‘real estate land’ that haven’t worked out just because both sides have insisted on taking what they think is the ‘moral’ or ‘right’ stance (otherwise known as the ‘ego’ or ‘victim’ position). But over the decades we have found that the best position for buying and selling is the ‘agreement’ position.

The fact is that there is no relationship between the time and pain involved in a negotiation, and the quality of the outcome you end up with.  Otherwise how could anybody think a 15 minute Saturday auction was a good thing?

So don’t rush. Don’t go in unprepared or without good representation. But at the same time don’t snatch defeat from the jaws of victory for no good reason other than it seemed too quick or too easy. How dumb would it be if the negotiation could have been good, simple and quick and you still said no! Helllooo sucker.

CAMBERWELL, 11 Wiringa Ave: Scott Patterson, passed in ($1,560,000, 5 bidders) then sold after

Cooling – off:
On March 1 (last week) the cooling off laws were amended so that now almost all purchases, except those transacted three days either side of an auction, are subject to a cooling-off period. Previously agents could remove the purchaser’s ability to end a contract within three business days of signing by forcing them to seek legal advice prior to making an offer.

Will this amendment have any material effect on the upper end market?

It may. What’s likely is that we’ll see less agents considering offers that come in well before auction day, and agents busier than ever before on the three days just before and after the auction when an agreement can be locked in with more certainty.

We may also see less of the early Auction ring-around with a good offer. Let’s say an agent receives a $3,500,000 offer in writing on a $3,000,000 home three weeks before the auction. Why would the agent do the ring-around to other buyers, potentially scaring them away from the home at $3,500,000, if there was a possibility that the $3,500,000 buyer might exercise his right to cool off? That would significantly affect the auction momentum. What’s more likely now is that the seller will simply accept the $3,500,000, wait till the cooling off is over and then tell other buyers the deal is done – perhaps creating more heat between selling agent and buyers.

Alternatively, there may now be a potentially acceptable buyer strategy where the buyer makes a high offer, then takes advantage of the protection of the cooling off period to end the contract and then comes in later at a lower amount and perhaps under another name – having seriously disrupted the sale process.

What about a boardroom auction? Does this qualify as a publicly advertised auction in all cases with regards to cooling off? What is the definition of publicly advertised? We are looking forward to a clarification on this from the REIV and the government.

Cooling off raises other issues too – especially if you are involved in long negotiations. What most people don’t realise is that your cooling off period begins when you make an offer, not when agreement is reached with the seller. So if the negotiating process takes longer than 3 business days, you will have lost your cooling-off period. There are also some other tricky issues re forfeiture of monies, and the actual process of claiming cooling off. So get some legal or buying agent advice before relying on it as a strategy.

Personally we think you are unwise to use cooling-off as a strategy in negotiation. We as an organisation do not use it as a negotiating strategy. Our strong recommendation is that you do all your due diligence prior to signing.

$3M+ Summary:
As we came to the end of February, most of the work we are involved in at this price level is off market or pre market.

However two really good properties that have just commenced their public selling campaigns should provide a very good public indication of where the market is at: 29 Kooyongkoot Rd, Hawthorn (Michael Armstrong) and  11 Bates St, Malvern (Tim Derham and Jeff Gole). We have inspected and rated both these properties, and there is more information on both in our regular article on the $3m+ Property Market. We’ll be very interested to see the outcomes of these sales.

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

• Albert Park, 2 Kerferd Place (Oliver Bruce and Kaine Lanyon) – Mid Week Auction bought for $2,380,000
• 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.
• See Biggest Auctions below - 5 results over $3m and also one at 112 McKean St Fitzroy with Shayne Mooney of Nelson Alexander

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, 19 St Ninians: Nick Johnstone, bought after auction for $3,150,000, 1 bidder

‘Round the Grounds: Market Wrap Headlines

• Boroondara – Bidder Numbers up on Solid Stock Numbers – 72%
• Stonnington – Steady as she goes and first action at the Top End – 68%
• Port Phillip – The best numbers for the year so far on good stock numbers – 65%
• Bayside – Leading the way at $3M+ with 5 sales this week – 73%

A word from the experts: Bumper Edition due to our break next weekend.

How has the $M+ market started, and what are stock levels like pre-Easter?

James Tostevin, Marshall White (Hawthorn): “A very encouraging and promising start to 2012, with multiple bidders at most auctions and literally double the numbers of buyers for open for inspections this year compared to the last quarter of 2011”.

Mike Gibson, Kay & Burton (South Yarra): “The million dollar market has started a little stronger than where it finished in December. The volume of properties is also increasing and it would appear that buyers are more confident in moving forward in 2012.”

Gary Peer, Gary Peer (Caulfield North): “ There is a small burst of quality properties coming on the market pre-Easter, which may result in a quiet winter season.”

John Holdsworth, Greg Hocking (Albert Park): “Stock levels are somewhat distorted in Albert and Middle Park because of the long weekend and car races, and then Easter. So far on low turnover, the million dollar plus market is still patchy.”

Jenny Dwyer, Hocking Stuart (Sandringham): “The million dollar market has seen a renewed sense of activity since the New Year, with solid prices being achieved. Attendances are on the increase at open for inspections and auction crowds are larger than the spring market.  Pre Easter auctions and private sales are high across all price ranges and all suburbs.”

Iain Carmichael, BenMac (Armadale): “Last week we were of the view that the auction market for $1 million plus properties delivered strongly on its first real test for the year – for us, a 75% clearance. Last weekend (Saturday 25) resulted in a few more pass-ins than we would have liked. And who knows what next weekend will bring. It’s a tricky market to categorise but no doubt it will explain itself as the year rolls out.”

Richard Winneke, Jellis Craig (Hawthorn): “From our perspective it has started very strongly. There have been several bidders at almost every auction so far. Buyers have finally realised it is a good time to buy- why wait any longer?”

Andrew Stuart, Hocking Stuart (Albert Park): “It seems  there is renewed confidence in all sectors of the inner-city bayside market. The sentiment now is that perhaps we have hit the bottom and that prices may again be on the move upwards. Hopefully there is a spark that will get the engine rolling again!!  Stock levels pre Easter are down on last year. However, should vendors get a sniff of increased activity we should see a lift in listings for the period immediately after Easter.”

Mark Earle, Buxton (Sandringham): “For quality homes that are priced in accordance with recent comparable sales, the market is strong.  Numbers in general are surprisingly strong but this hasn’t translated to sales just yet.”

Greg Toogood (Jellis Craig) - man in charge! 7 Ross St, Kew, under the hammer, $1,920,000, 5 bidders

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, 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)

Top Bidderman Auctions:

Brighton East, 734 Hawthorn Road, Phil de Fegely, under the hammer, $2,220,000, 5 bidders:  A sea of shoes lined the front entrance and the assembled group of 60 swamped the front two rooms of the property….(see more in Auction Reports)

Kew, 7 Ross St, Richard Earle (Jellis Craig), under the hammer, $1,920,000, 5 bidders: Here was an auction in two halves. A slow start had Richard Earle posting three consecutive vendor bids, opening at $1,600,000 and chipping in two more to $1,630,000….(see more in Auction Reports)

Armadale, 38 Lambeth Ave, John Bongiorno (Marshall White), under the hammer, 4 bidders: This is my first Growling Jack auction for the year and he was in fine form in front of a very wet crowd of 120…(see more in Auction Reports)

Top 3 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)

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)

Brighton East, 10 Connor St, David Gilham (Noel Jones), passed in, $2,050,000, 1 bidder: A cool, wet autumn morning in a delightfully quiet and well maintained street – it was the perfect setting for an auction…(see more in Auction Reports)

Big Issue Video: Mal and Architect Adam discuss the early 2012 Market. Click on the live action.

No Marketnews next week due to Labour Day long weekend.

Mirror Mirror on the wall, is the market going to rise or is it going to fall? Richard Earle and Steve Burke looking for inspiration and bidders, but neither were forthcoming at 72 Princes St Kew. Passed in for $2,425,000. No bidders.

At 6pm on Saturday, the James Clearance Rate for $M+ was 59% on the 37 auctions we attended. That figure was steady on last week. The Weekly Review Bidderman, our demand indicator, was also steady on last week, at 1.5 bidders per auction. The $2.5m+ market was weak, with 8 from 10 reported as having passed-in; but the rest of the market looked pretty balanced.

Market Summary:
Last week started pretty well for both buyers and sellers – especially when you consider the negative press backdrop re job losses. And the reason it started well was because there actually was a market.  Buyers and sellers were transacting. Buyers were competing on the right homes, and sellers were moving their homes on at the right price. This week was a similar story except at the highest of the high end.

Last week was characterised by just as many sales in the 3 hours post auction as there were sales during the 15 minutes under the hammer. This week was a similar story – except at the $3m level.

Despite the records showing that 8 out of the 10 homes selling at the $2.5m  level were passed in this weekend, there does seem to be some spark out there right now. It’s not quite showing up in the stats, but we feel that buyer interest is building, especially at the lower $M+ levels. The strongest spark is from buyers waiting for a sign to validate their price thoughts and who, when that sign comes via an offer from another buyer, are returning fire and lifting their price, sometimes quite strongly and rapidly.

What does this mean? In our opinion it shows there is cautious demand and if this continues or spreads more widely then the market may stabilise and ultimately could increase in price. It’s very early days. But the signs are certainly not all negative out there in the lower part of the million dollar plus quality market right now. Buyers will put up a bit of a fight these days rather than walk away as they did for most of Spring 2011.  For example: 18 Bamfield Sandringham with Mark Earle and Peter Hickey of Buxton, which couldn’t get a sniff at $2,200,000 last year, concluded in a boardroom auction this weekend at $2,300,000 with 3 bidders. That was after the 10 Victoria St (Peter Kennett) re-auction last week (around the corner) had 3 bidders, after a non event last year.

Another interesting market characteristic last week was the huge variances in bidder numbers at each auction – few had many, while many had few. This week the spread was a little more even across the board.

Last week was low on stock numbers with 50 auctions over a $M in Bayside and Inner East. This weekend and next weekend are both solid weekends with more than 100 auctions – and there are some more solid weekends leading up to Easter.

So after two weeks into the market, what are we sure about?

Price, as a blanket statement, is up to 25% off the price highs of Anzac Day 2010. Good evidence of this is land prices in all suburbs, but in particular places such as Balwyn and North Balwyn where the typical 2010 $3.3m French Provincial build and sell has now become the 2012 $2.8m French Provincial build and sell.
The degree of discounting depends on

• The Quality Characteristics of the home, combined with
• The initial offering price to market

1. The overall market has a number of segments that are now roughly at pre GFC 2007 prices (although this is a generalisation). But there are also a number of exceptions, such as the single fronted 6 Highbury Grove Prahran (John Morrisby) which showed a 50% increase in value between 2007 and 2012 with no improvements to the property (see auction report).
2. There is definitely a feeling of increased activity in the last fortnight. Selling agents are far more positive than they were in January. This is supported by numbers going through open for inspections, bidder numbers and finally transactions. A few biggies that were cleaned up this week (but at lower prices than initially offered) were:

3 Park St Brighton (Jason Gill) – Wrapped up this week at just under $3m after being on the market for a fair while.

47-49 Victoria St Sandringham (Julian Augustini) – Big parcel of land, on the market since late last year and sold in the mid $3ms.

324 Beaconsfield Parade St Kilda West (Shane Siemers) – Went to auction last year at over $5m and sold, we believe, in the sub $4m range this week.

The Deli Lama - Mark Dayman was back working the crowd in his usual entertaining manner - we missed him - and he got the 2 bidders to $3,900,000 at 2 Laurel Court Hawthorn East - but that still wasn’t enough!

‘Round the Grounds $M+:
Boroondara: 70% clearance rate on solid auction numbers – strong and steady as per last week
Stonnington: No complaints from sellers or buyers – 72%
Port Phillip: No mystery here, agent pricing continues to be too high – 46%
Bayside: Transactions are mainly forced rather than joyous ones, but they are happening – with Sandringham the best Top End performer this week (away from auctions) – 64%

A word from the experts: How did auctions over $1m start, and what are stock levels like for March?

Justin Long, Marshall White (Armadale): “Certainly we have found there has been a little more strength this year already – a combination of December/January starvation of supply, vendor realism kicking in and perhaps just a hint of good economic news around the world and locally. March stock levels are strong.”

Hamish Tostevin, Marshall White (Hawthorn): “Yes the sales started quite well last weekend, with 9 sales in excess of $1,000,000, and some good bidding at the auctions. We are optimistic about this continuing and, if the inspection numbers are any indication, there should be some solid weekends ahead of us. March auction numbers have certainly continued to get stronger in the back half of the month prior to the Easter weekend – especially the 24^th and 31^st which are emerging as strong weekends. ”

Peter Kennett, Hocking Stuart (Brighton): “As far as future auctions for March…there definitely are a fresh crop of buyers in the market as well as some from last year. A vendor will be able sell their property, only if they are in tune with today’s market  sentiment as buyers are very well aware of over inflated prices.”

Geoff Cayzer, Cayzer (Albert Park): “The stock levels listed by our company for March would be approximately 50% less when compared with March 2011, bearing in mind the Melbourne Grand Prix being held from March 15^th – 18^th.”

Scott "Pretty Boy" Patterson was not so pretty on Saturday when 29 Hopetoun Canterbury passed in at $2,650,000. No bidders.

Biggest Auctions:

Hawthorn, 84 Kinkora Rd, Alastair Craig (Jellis Craig), Under the hammer, undisclosed above $2,500,000, 4 bidders
A lively, interested crowd squeezed inside for this one. In the kitchen, living area and hallways they listened to Alastair Craig’s friendly, relaxed opening message…(See more in Auction Reports)

Armadale, 86 Wattletree Rd, Andrew Hayne (Marshall White), Bought after, undisclosed above $2,470,000, 1 bidder
With the hot sun almost oppressive, standing room in the shade was at a premium….(See more in Auction Reports)

East Melbourne, 112 Powlett St, Iain Carmichael (BenMac), Bought after, $2,045,000, 2 bidders
A hot Melbourne afternoon with a near perfect blue sky, and many found shady refuge on the wide median strip here to watch auctioneer Iain Carmichael ply his trade and sell this double-storey Victorian Row terrace, in one of East Melbourne’s best streets. What a great place to live!…(See more in Auction Reports)

Top Bidderman Auctions:

Brighton East, 49 Regent St, Rodney Morley (Woodards TBM), Under the hammer, $1,285,000, 5 bidders
It was an exceptionally good idea to hold the auction under the carport and in the shaded front yard of the home – and with the free bottles of water handed out before proceedings started, the Woodards team was off to a good start!…(See more in Auction Reports)

South Yarra, 33 Clara St, John Bongiorno (Marshall White), Under the hammer, $941,000, 4 bidders
By his own admission, auctioneer John Bongiorno’s opening bid of $800,000 was on the low side. But it worked a treat!…(See more in Auction Reports)

Biggest Pass Ins:

Hawthorn East, 2 Laurel Court, Mark Dayman (Marshall White), Passed in, $3,900,000, 2 bidders
The weather was hot and sticky but that didn’t stop a good crowd of around 120 people attending this auction at 2 Laurel Court in Hawthorn East…(See more in Auction Reports)

Canterbury, 29 Hopetoun Ave, Scott Patterson (Kay & Burton), Passed in, $2,650,000, no bidders
Short and sharp auction this one. In front of around 30 people and in dry hot weather, auctioneer Scott Patterson gave a concise account of the home and the auction rules and looked for an opening bid around the $2,600,000-$2,700.000 mark, but none from the crowd were forthcoming…(See more in Auction Reports)

Malvern, 119 Stanhope St, Andrew Macmillan (Benmac), Passed in, $2,500,000, no bidders
Andrew Macmillan leads us into the auction in front of a smallish crowd of around 40. Solid Edwardian – nicely renovated on 740 sqm. These homes always sell…(See more in Auction Reports)

The auctions are back on again and the chatter about what is happening on the 2012 property market has started. By Labour Day the trickle of opinion on the state of the market will turn into a flood.

The big question for many of you right now may well be: should we buy the family home in Brighton or Hawthorn now – or should we wait till later in the year? You may be worrying about what’s happening to the economy, and wondering how it’s going to affect the property market.

But the fact is it’s still impossible to say what’s happening on those two fronts. And whether or not you decide to buy now or later in the year, first you need to work through your home-buying plan for 2012. To some people this is an amazingly difficult ask. But I can assure you that if you make a sensible plan and follow it, it’s a Black Caviar certainty you’ll buy a house that suits your needs, makes your family happier,  and lets you retire earlier.

Your plan should include both financial and emotional outcomes. Financial outcomes include whether you aim to minimise debt as soon as possible, and whether you want your home to help you build wealth. Emotional outcomes are about what kind of property will maximise your family’s happiness and well-being.

Your plan will of course be very different depending on what stage of life you are at, whether you’re a Single, Couple, have Young Children, or Older Children, are in Mid Life or Retirement.

So grab your iPad or a piece of paper and pencil and divide a page into three columns. At the top of Column 1 write ‘Position’; at the top of Column 2 write ‘Property’ and at 3 write ‘Price’.

This is where you answers will go –what about  the questions?

Start with the emotional outcomes. If you are a single or child-free couple you might be focusing on car-spaces, benchtops, or a groovy locale. But think in terms of a bigger picture. Imagine your life five years from now. Maybe you’ll meet somebody, leave somebody, get a job, lose a job, go to Nepal, discover the punt. The point is your price column shouldn’t tie you down to a life of endless mortgage payments; your property column should have room for a spouse or child or renter; and your position should go beyond the one funky suburb. Your best emotional outcomes are flexible ones.

If you have Young Children, your focus will be on how the house can accommodate you all happily as the family grows. So think hard when filling in the ‘Property’ column on how the floorplan can combine supervision with some separation. With Older Children your emotional focus is schooling and transport. So when you fill out the Position column, remember that where you live in relation to schools and public transport determines how much time you’ll spend driving the kids around in the car.

In the Mid Life stage, there’s a chance you’ll make a big dramatic life change – move to the country  or overseas. But when you look at Price be careful you don’t rule out the possibility you may want to come back to a home in the city. In the Retirement stage your emotional focus will move back to the Position column – to somewhere you can easily walk to a cafe, catch a train and see your doctor.

In terms of the financial outcomes in your life your answers will revolve around Growth (building wealth to give you choice later in life), Cash flow (allowing you to live for the now) and Risk (allowing you to sleep at night). All boring but necessary.

Once you have a PPP plan, looking at each home becomes much easier and quicker because you know what you want. You can assess each home against your plan rather than looking at each home and then trying to work out a plan to fit.

If your PPP Plan is functioning well then the question asked at the start: ‘Do I buy now or do I wait?’ can be answered relatively easily. It’s not so much about getting the timing right, but about the property itself: does it meet my PPPs plan and does it feel right? Yes? Well then, buy it! No? Wait and keep looking.

Printed each week in The Weekly Review – Melbourne’s $Million Plus property magazine

CAMBERWELL, 46 Gardiner Pde, Mark Williams (Marshall White), bought $1,925,000, 1 bidder: The crowds were out in force but the results didn't necessarily match.

Hellooo Melbourne Million Dollar Plus Market Watchers and welcome to our first edition for 2012. Two big Melbourne sporting events started again this weekend after a summer hiatus – the Pre Season NAB Cup and the Melbourne Auction scene.

On the auction scene, overall demand was not too awful. At 6.00pm Saturday, the James Clearance Rate for $M+ in Inner East and Bayside was 58% on the 31 auctions we attended. The Weekly Review Bidderman, our demand indicator, began the year at 1.5 bidders per auction.

This weekend’s numbers were low, at just over 50 in that $M+ bracket. But next weekend will have well over 100, a solid number. And we’ll see a similar number on March 3 before we have a significant drop on March 10 due to the Labour Day weekend.

Market Wrap-up

• Overall the market appeared weaker on early results, i.e. under the hammer. As the day wore on though, and pass-ins were cleaned up, the indications were that the market seems to have started as well as could be expected. But it’s too soon to say it’s a clear positive trend.
• Stock levels on offer were low in number, in quality and in dollar value. Only two auctions had results over $3m – one sold and one didn’t. So it’s still a bit foggy to us.
• A number of pass-ins were cleaned up post auction – meaning a lot of the action was not visible this weekend.
• The phenomenon that became very evident late in 2011 has continued in 2012. This weekend we counted 46 bidders at 31 auctions – so there is demand out there. BUT there was no evenness: five auctions had 50% of the bidders averaging almost 5 bidders per auction and the other 26 auctions averaged just under one bidder per auction.

‘Round the Grounds:
Bayside – Low levels and mostly unexciting stock, so 56% is an even result.
Boroondara – Actually that’s pretty impressive first up – 83% clearance.
Stonnington – Solid start on low numbers  – 75% clearance
Port Phillip – Whoops – somebody forgot to tell the buyers auctions had started again – 20%

Market Summary – Year to Date 2012.

2011 was a year of generally falling prices – with the exceptions of the months of May, September and December. Yes we finished the year off OK, but it was more a case or arresting the fall rather than any lighting of price rockets.

Last year we saw drops in market values on homes that started too high on price, with owners that then had to sell. This was particularly the case with properties that were of inferior quality or in poor positions. In many cases these drops were 20% and more off the Anzac Day 2010 high. A lot of that fall in value happened in the last quarter of 2011.

On the subject of price falls: some organisations are spruiking median price increases in the last quarter of last year as real stats, which only proves that there are dope tests that can have false positives. The market did have some strong results in December but overall it was a negative second half for many sellers (in terms of lower selling prices or not selling at all).

So how have we started 2012? In a word QUIETLY.

By any previous year’s measurement, 2012 has been pretty quiet out of the blocks – except for agent claims of numbers through opens.

1. Only a handful of $3m+ buys (see our report)
2. Little new stock of high calibre at this price level came onto the market in February. This is particularly so in the Inner East. March may turn out to be different from what we are hearing and seeing pre-market with a number of sellers keen to get a result prior to our early April Easter. But that is conjecture until we see March new stock numbers confirmed.
3. When the market is quiet, agent turnover drops and so do agents’ incomes; unrest builds and the merry-go-round begins. During late 2011 and early 2012 agent coffee shop meetings have been up.

So yes, the market still seems a little quiet, but it’s not that bad. It’s pretty much as expected and this weekend went as well as a selling agent could have hoped for….

What of the claimed increase numbers at open for inspections? We actually support this premise and the implication that demand may be stronger than the results show.  Our enquiry numbers are up and the number of clients looking for homes is also up on this time last year, even if we’ve seen little change in the number of clients in actual negotiation this year compared to last. Result-wise we also started OK, with buys in Fitzroy, Glen Iris and Brighton in the $1m, $2m and $3m price bracket in early February. Over January we were closed as we always are.

Demand being OK can be further supported by our Stale and Stalemate results. As we went into Christmas we had four key $2m to $3m negotiations in stalemate, in that the vendor was fixed at X and our buyer was fixed at Y. It was a stalemate as opposed to a momentum negotiation because the vendor felt no compulsion to lower their price and our buyer had no proof as to why they had to increase their bid.

Ten weeks later, the results on those negotiations are:

1. Burke Road Malvern – Marshall White’s Maddy Kennedy got a surprising near $3m offer from another buyer. It was a really good home but in a difficult location and the auction only produced a vendor bid of $2.4m. Tick to seller.
2. Victoria St Brighton – Barb Gregory of Marshall White Brighton. Another buyer met the reserve of $3.5m. Not surprising – this was a good home and fair price. Tick to seller.
3. Moffat St, Brighton – Bought after some argy-bargy with Chris Bevan of JP Dixon. This was a brilliant design and build and had been on the market for over a year. Tick to both buyer and seller.
4. Camberwell – This is still in a stalemate negotiation, and with other blocks nearby also unsold it’s hard to tell when or even if something may happen on this. No ticks.

A word from the experts: How has the year started?

David Hart, Buxton (Brighton): “Traditionally the Brighton market is pretty slow to gain momentum with regard to stock levels. This year is certainly no different, with a shortage of quality listings across the board.”

Richard Winneke, Jellis Craig (Hawthorn): “The year has started very strongly. We have seen an average of around 20 groups per home (compared to Spring last year with around 10-15). Six out of six $1m+  homes sold at auction on February 11 with Jellis Craig. Many buyers are wanting to buy and are putting  in offers before auction.”

James Connell, Marshall White (Armadale): “It has been a good start to the year with a lot of good activity, positive activity. However, it is still  too early to judge the extent of the momentum.”

BRIGHTON, 1 Farleigh Grove, Greg Costello (RT Edgar), under the hammer, $2,222,000, 6 bidders

Early 2012 Top End Private Sales

• Brighton East, 181 Were St – Kate Strickland – Over $3m – Cutting edge home – Big price for East Brighton
• Brighton, 10 Victoria – Barb Gregory – Over $3.5m – Modern 7 yo family home near the water
• Brighton, 17 Huntingfield – Regina Schmidt and Brian Devlin – Over $3.3m – Big family home
• Brighton 2 Collins Brighton– Regina Schmidt and Brian Devlin – Over $3m – Townhouse, one of a pair
• Brighton 26 Moffat Brighton – Chris Bevan – Cutting edge family home
• Balwyn, 15 Boston – Mark Rathgeber – $3,300,000 – Big family home
• Hawthorn, 58 Kooyongkoot – Scott Patterson – Over $3m – Family home
• Prahran, 22 Murray – Tim Wilson – Over $3m – Big land
• Kew, 65 Stevenson – Paul Richards – Big period home – $3m

ALBERT PARK, 148 Beaconsfield Pde, David Wood (Hocking Stuart), under the hammer, $3,010,000, 4 bidders

3 Biggest Auctions:

Albert Park, 148 Beaconsfield Pde, David Wood (Hocking Stuart), Under the hammer $3,010,000, 4 bidders
A strong crowd converged under the hot Melbourne midday sun to see if this beachside property would find a new owner…. (See more in Auction Reports)

Malvern East, 56 Central Park Rd, Iain Carmichael (Benmac), After auction, $2,680,000, 1 bidder
Great setting for an auction – on the street, across the road from Central Park. This certainly highlighted the big plus of the property – it was all about position…. (See more in Auction Reports)

Sandringham, 10 Victoria St, Peter Kennett (Hocking Stuart), Under the hammer, $1,935,000, 3 bidders
This home had been offered for auction late last year so I, among many of those gathered, was keen to see what would happen when it was offered this time around…..(See more in Auction Reports)

Top Bidderman Auctions:

Brighton, 1 Farleigh Grove, Greg Costello (RT Edgar), Under the hammer, $2,222,000, 6 bidders
My first auction of the year and I’m a little toey as the auction bell rings. It’s not nerves, more anticipation. You see I think it will fly along and I’ve been starved of the buzz of an auction for 8 long weeks…(See more in Auction Reports)

Kooyong, 13 Talbot Cres, Andrew Summons (Hocking Stuart), under the hammer, $1,161,500, 5 bidders
A perfect sunny day provided the backdrop for a great auction and a spectacular auction it was. Auctioneer Andrew Summons took centre stage and in his preamble spoke enthusiastically of the property with its delightful period features and north facing backyard, with the Kooyong location providing a village atmosphere….(See more in Auction Reports)

South Yarra, 21 Nicholson St, John Bongiorno (Marshall White), under the hammer, $1,525,000, 4 bidders
This fine double-fronted Victorian cottage made for the perfect back drop for this auction. And centre stage is where auctioneer John Bongiorno does his best work….(See more in Auction Reports)

Biggest Pass Ins:

Camberwell, 3 Christowel St, Paul Williamson (Jellis Craig), passed in, $3,025,000, no bidders
One of the first big Melbourne auctions of the day (if not the year), and it was much anticipated…(See more in Auction Reports)

Brighton, 20 Birdwood Ave, Stewart Lopez (Kay & Burton), passed in, $2,700,000, no bidders
A good sized crowd of around 40 people were on hand to watch this auction, led by the affable Stewart Lopez…(See more in Auction Reports)

Buyer Masterclass: Should we wait or should we buy now? Read Buyer Masterclass, this Wednesday.

Big Issue: Our next market video will be up this week. Check out the live action.

Big auction, big crowd and big bidder numbers: 98-100 Mont Albert, Canterbury, Alastair Craig (Jellis Craig), under the hammer, $3,380,000, 6 bidders

At 6pm on Saturday, the James Clearance Rate for $M+ was 50% on the 36 auctions we attended. Auction-wise it was only the second 100+ auction day for $M+ homes in Inner East and Bayside since Autumn – and all things considered it wasn’t a shocker. However it certainly wasn’t positive news for sellers with high expectations. You can feel the market is slipping away a little more for them. We are firmly in a downward spike (which started on Preliminary Final Day 2011) on the back of an overall downward trend since Anzac Day 2010.

The exceptions to this blanket statement are quality, well priced Top End homes – they still have some real ooomph!

Going forward, there is a fortnight of decent auction numbers to go (around 80 on each of December 3rd and December 10th) before things start to really shut down for Santa.

The Weekly Review Bidderman, our demand indicator, was 1.5 bidders per auction this weekend. But this was again very polarised around a few good auctions, with the majority having  little multiple interest.

Given all of the above, we have adjusted our James $M+ Market Indicator below Buyers Market to Cool.

The downward price spike may lead to a shortage of quality stock going forward, given that discretionary sellers don’t come into falling markets unless they cease to be discretionary sellers. There are a lot of stales (long term pass-ins) and rebadgers (unsolds from earlier in the year coming back to market) starting to clog up the machinations between buyer and seller in late 2011.

Next year’s 2012 Autumn market has little choice but to start with this anchor of overhang. How individual buyer and sellers will go depends in many ways on their goals and the skill of their buying or selling agents.

However, amongst this negativity there was a glimmer of positiveness from a mid week auction (Wednesday 23rd November) we attended.

58 Glyndon Rd, Camberwell (Jock Langley of Abercromby’s)
Private Auction only 7 people in attendance.
James Home Rating Excerpt: Big home in the ‘almost ‘burbs’ on 2100 sqm with tennis court – it’s all about the land.
James Auction Report BOUGHT over $3,300,000:  We attended this mid week private auction  just in case a bargain was to be had. No bargain, with a very healthy auction by Tim Derham of Abercromby’s. With three bidders it passed in for $3,300,000 and a bit. A deal was negotiated afterwards in excess of that figure. Strong result for outer Camberwell!

“Round the Grounds Saturday – Overall Stonnington was a shining light. Bayside’s woes are increasing due to long term auction overpricing at the Top End

• Port Phillip – In a month when no reported sale has been over $2 million, this weekend was a continuation of the weakness with a 20% Clearance Rate
• Boroondara – Under the weight of stock numbers, Boroondara continues to ease – 43%
• Bayside – High end Brighton is not happening (outside the Golden Mile) and because of the continuing number of pass-ins, buyers are increasingly nervous, asking themselves: “What is the right price – is it a bit less or a lot less?” – 35%
• Stonnington – Island in a storm. Vendors must be listening to their agents again with a surprisingly strong number – 67%.

Overall Market Summary for Spring 2011

In 4 of the previous 5 years, at this time, buyers have been keen as mustard to buy anything that was on offer – GFC 2008 being the exception.

In late 2011 buyers are simply not doing that. They are not lurching around like disaster victims looking at near empty supermarket shelves, snatching at stale stock, overpriced offerings and out of date goods. Buyers are there, but they are far more discerning than in years gone by.

There is minimal panic as most buyers feel 2012 will be better for them. Whether or not that is true remains to be seen.

As a buyer, if you can mentally cope with a falling market (and prices have fallen for most of the year on all properties except the best of the best), then it doesn’t get much better for you with the solid stock levels we’re seeing now  (as long as you can find what you want).

In this last few weeks of Spring, buyers have been able to consider purchases without having the spectre of “there will never be another” hanging over their head, because … there has always been another. That’s not to say there has been no competition for good homes, but it has been a far more civilised buyers market than for much of the last decade.

As for buying and selling agents, transactions have been steady, not at the heady levels of last year and we have all had to work harder (not a bad thing); but business has been solid enough to keep the wolf from the door.

For sellers it has been a different story. They have fallen into two categories: those that listen and want to sell and those that don’t. Or to put it another way: there are those that have a well priced quality offering and those that don’t.

Not that we’re picking on sellers. In 2011, buyers have also needed to listen. If it was good quality and well priced then you needed to compete or else you missed out.  If you bought it “cheaply without pressure” then possibly you bought what nobody else wanted and that is not a good thing going forward.

Late 2011 has in our opinion, been a watershed, one where sanity and balance has returned to the markets and it has been buyer led.

If 2008 was the year of the GFC, 2009 the year of the rebound, 2010 the bumper year then we think 2011 has been the year of the split and balanced markets.

The Inner Melbourne $M+ market is right now a real dichotomy – a market of two dimensions – there are the haves (properties with bidders) and the have-nots (properties with no solid interest).

All the data we collect supports this.

Bidderman: Look at these stats over the last 3 weeks, which highlight in our opinion exactly what has been happening to a large extent all year. Two weeks ago we reported 27 bidders on 5 homes and 14 bidders combined on the other 21 auctions. Last week the same story – 17 bidders on 4 homes auctioned and only 15 bidders combined on the other 21 homes that we reported on. This week we had 26 bidders on 7 homes and 24 bidders combined on the other 27 homes we reported on. If you are hot, you can be really hot and if you’re not then you need a panadol and a good agent.

Clearance Rates: Basically on auction day the chance of selling is 50/50. That is for every home the market judges worth buying it also judges one is not worth buying (at the asking price).

Stales: (long term pass-ins) The market is acting on properties where prices are adjusted, and continuing to pass over homes where the vendor remains committed to a price rather than a result. One month after Super Saturday a full third of the homes that went to auction still had not been sold. It is not true for agents to say they are all being cleaned up. They are not.

Expressions of Interest: No different to auctions. At the Top End last month we nominated 8 homes to monitor as having Expressions of Interest closing dates either side of the Melbourne Cup. Of those 8 – 4, or 50%, have sold around the proposed closing time and the others remain on the market. The 4 that have sold were goodies and they got exceptional prices. The other 4, well they remain unattached to a buyer.

With this being the second last Marketnews for the year (and by the way thank you for your support – we just recently achieved our 500,000th reader for the year to our james.net.au websites) we thought we would look at the Top 3 things buyers can do to take advantage of what is on offer before Christmas.

1)   Find: Off markets, stales, rebadgers and pass-ins. Many homes are being re-presented after failed campaigns early in the year. If they failed on price then, why pay it now? Off markets are back in season as many recent buyers would be keen to see a quiet sale before Christmas rather than wait till 2012 – there may be a bargain there. Stales – don’t give up. If it’s a home you like then revisit with a  written offer – even if the asking price is baloney. Rule One in this market: if you don’t ask, you don’t get. Man up and put the offer in!

2)  Assess Price: Use past sales carefully and change their meaning – sales of six months ago are now the ceiling prices, not the floor prices (as in previous years). The market is going backwards in price, not forwards (A graders excepted).

3)   Negotiate: - As buyers if you want to negotiate to your advantage while still maintaining a reasonable level of risk in terms of buying versus missing out on the home, then you need to be able to apply the Fisherman’s Friend Wet Fish Slap on overpriced homes. You know the commercial – where she gives him an uppercut with a wet fish. If the price is baloney and you are not going to pay it, don’t walk away – you may be doing yourself and the seller a disservice, as you may in fact be the best buyer. Go and hit the seller with the Fisherman’s Friend Wet Fish Slap and then apply pain relief afterwards. This is exactly what our selling agent friends have been doing for years in post auction negotiations. They hit you hard with a big number, then they offer to relieve your pain (slightly). So if you have a sensible price, go and offer it – you may well be the seller’s best deal and if you walk away because of your timidity, then both you and the seller lose. If a Fisherman’s Friend Wet Fish Slap is not your caper consider hiring a professional who can help you – it’s invigorating. And of course if it doesn’t have the desired effect – consider moving on.

The $3M+ market: After last week’s less than stellar showing at auction for $3M+, results were slightly better this weekend:

Bought

• 98-100 Mont Albert Road, Canterbury (Alastair Craig) – $3,380,000 – 6 bidders
• 25 Grange Road, Kew (James Tostevin) – Around $3,000,000 – 1 bidder
• 24 Anderson Street, Malvern East (Heather Elder) – Around $3,000,000 – 2 bidders

Passed-In

• 2 Collins Street, Brighton – $2,975,000 – 0 bidders
• 1022 Malvern Road, Armadale – $2,800,000 – 0 bidders
• 21 Wattle Road, Hawthorn – $3,050,000 – 0 bidders
• 68 Molesworth Street, Kew – $4,600,000  – 0 bidders
• 20 McGregor Street, Middle Park – $3,200,000 – 0 bidders

3 strongish results during the week:

Friday 25th November – 58 Howitt Road, Caulfield North has been bought for a record Caulfield price according to the effervescent Ross Savas of Kay and Burton. The price;  well can say they were talking $6 million and the calibre of the home leads us to conclude they would have got that, so over is definitely not out of the question. This was a truly great home, our James Home Rating of 838/1000 is one of the highest we have scored this year. The market is obviously still recognising and paying for great quality.

Thursday 24th November – 25 Montalto Avenue, Toorak ( Nicole Gleeson) – Basically land only for the area as the home requires a serious reno. Passed-in last Saturday on a lone vendor bid of $3,450,000 and bought Saturday for an undisclosed amount.

Monday 21st November – 6-8 Myrtle Street, Brighton (Barb Gregory – Marshall White Brighton). Last weekend’s biggest auction – and another private one at that, was completed at a price over the quote of $6,000,000. So another solid Golden Mile sale with land in excess of 1600 sqm plus some solid improvements and another good result for Marshall White in Brighton. While private auctions are very secretive they seem to meet the vendors’ requirements for privacy and a buyers’ liking for transparency – perhaps a way of the future for some key homes.

BRIGHTON EAST, 13 Holmhurst Crt: Mark Earle (Buxton) does his best to encourage bidding but to no avail, passed in $2,000,000, 1 bidder

Biggest Sale: 98-100 Mont Albert Rd, Canterbury, Alastair Craig (Jellis Craig); Under the hammer $3,380,000, 6 bidders
There was a real buzz before the start of this auction and the team at Jellis Craig knew it as well, as I counted at least six agents all coming along to support auctioneer Alastair Craig. The crowd size was decent too with around 70 crowding around the kitchen and family room. There was no need for a vendor bid as a confident opening bid of $2,600,000 was made and the auction was off and running. The bids came from all around the room and at times it was hard to see who was bidding because of the tightly packed crowd. But this did not impede on the flow of the auction and once Mr Craig flicked the switch and declared the property on the market a roar came from the crowd. The increased chatter and activity brought a tingle to the spine as the bidders knew things were serious and the auction moved up a gear. Six bidders were now fighting it out, each trying to outfox each other with small bids and big knockout bids; in fact all manner of tactics were brought to the table. But amongst the storm and flurry the original bidder stood firm swatting back every threat and finally emerged victorious in the end. A terrific auction and the crowd agreed who all clapped loudly and congratulated the winning bidder. (Joshua Bong)

Biggest Pass In: 68 Molesworth St, Kew, James Tostevin (Marshall White); Passed in $4,600,000, no bidders
One of the last auctions of the day and in front of around 40 people, auctioneer James Tostevin sung the praises of this fine modern home keenly (perhaps calling it a masterpiece was bit of a stretch…..). James went on to say there are many Molesworth Streets in Melbourne but there really is only one that people remember and that is this one in Kew. Fair enough I thought, good call – there are some great properties here and it is a very special part of the world. Under sprinkling rain, a vendor bid of $4,600,000 was made and after several minutes of searching for a bid and then referring to the vendor, the property passed in at that mark.  (Adam Woledge)

Bidderbuzz Auction: 14 Clyde St, Glen Iris, John Bongiorno (Marshall White); Under the hammer $1,204,000, 5 bidders
A group of 30 clutching their umbrellas scurried quickly inside this Glen Iris property.  A “simply stunning” property were the enthusiastic words of auctioneer Growling Jack Bongiorno, to the assembled group in his preamble.  An opening bid of $950,000 was promptly offered from the crowd.  With his humour, Growling Jack had those in attendance laughing at many points throughout the auction creating a more relaxed atmosphere.  With four additional bidders joining the mix, the competition for the property was obvious.  The property was announced on the market at $1,170,000 and this news sparked a flurry of bidding.  The property was bought under the hammer for $1,204,000 to the applause of all. (Kate Agnoleto)

Buyer Masterclass: Negotiating on a property is all about balancing the risks with the rewards. Find out more in this week’s Buyer Masterclass, The Risks of Chasing  a Housebuying Reward.

We Only Buy Homes

The rain didn't deter the crowds. 20 McGregor, Middle Park, Damian O'Sullivan (Marshall White), passed in $3,200,000. No bidders but a big crowd of 170.

Through the blurry eyes of wet auction watchers - this is how most of us saw today. Hawthorn, 93 Liddiard St (Lachie Fraser-Smith of Bennison Mackinnon) Bought under the hammer, $1,807,000, 3 bidders

At 6pm on Saturday, the James Clearance Rate for $M+ was 44% on the 25 auctions we attended.

The Weekly Review Bidderman, our demand indicator, was 1.3 bidders per auction. But Bidderman is very inconsistent – last week we reported 27 bidders on 5 homes and 14 bidders combined on the other 21 auctions. This week the same story – 17 bidders on 4 homes auctioned and only 15 bidders combined on the other 21 homes that we reported on. Demand is there if the home is good and priced correctly – if its not, then silence greets the auctioneer and seller come auction day.

Market Summary

The Christmas Stock Rush has really gained some momentum in the last few weeks with a large influx of private sale homes coming onto the market – especially at the Top End (see our stock graphs).  We saw around 85 $M+ auctions this weekend, and next week looks like breaking the magic 100 barrier for $M+ auctions in Inner East and Bayside. So solid auction weekends, especially for 2011.

All this has to be good for buyers. Where in recent times our main challenge has been finding quality homes – now the bulk of our work has moved to assessment and negotiation.

Spring Prices continue to fall on homes that do not meet the market.
The representation below shows clearly what is happening as Spring unfolds. New stock is coming onto the market at all price levels, particularly at the highest level. Demand is simply not there (on many homes) at the prices being asked – hence the falling Bidderman and Clearance Rates – and this is resulting in falling prices for those that don’t originally meet the market and then have to sell.

Price is such a movable beast right now so as a buyer, it is good to have an open mind and strategies (within your acceptable risk v reward parameters) that can take advantage of the lay of the land. That is not to say that all the goodies are being given away – far from it, if you have a well priced A-grader – but once a home falls into that certain category (e.g, stale, overpriced or a B grader) then significant discounts are possible if the vendor needs to sell.

But a buyer needs to know what to do, how to do it and when to do it to be successful. By example, in the last fortnight or so one property in the $3 million range was purchased for more than $700,000 off the original asking price; another was bought for  $300,000+ off the original asking price and that was a $2 million home.

Now, more so than at any other time this year, it is a true buyers’ market with Great Choice and Flexible Pricing.

Lack of auction price matching continues this weekend  – $M+ Clearance Rates.

• Bayside – 44%
• Boroondara – 55%
• Stonnington – 39%

$3M+ Segment:  Some solid mid week sales – but lousy at auction today.

• 4 Kiers Court, Caulfield North (Phillip French), one of the more distinctive homes I have seen this year, is now reported as sold at $3,475,000.
• 181 Gipps St, East Melbourne (Sarah Case), over 1000 sqm, was bought undisclosed and finally to complete the RT Edgar trifecta
• 29 Loch St, St Kilda West (Anthony Grimwade), almost 1000 sqm plus period home, was bought for $3,800,000.
• 3/61 Nepean Highway, Aspendale (Rowan Thompson),  which we reported as passed-in last weekend, has now been bought for $3,150,000.

At auction only two out of nine were reported as sold at the $3m+ level.

• 19 Florence St, Kew (Diana Healy) – Bought for over $3,600,000
• 2 Monomeath Pl, Canterbury ( Richard Earle) – Bought after for over $3,100,000

Pass-Ins at

• 47 York St, Kilda West – $3,800,000
• 24 Monaro Rd, Kooyong – $3,500,000
• 25 Montalto Ave, Toorak – $3,450,000
• 9 Berry St, East Melbourne – $3,200,000
• 11 Victor Ave, Kew – $3,000,000
• 2 Snooks Crt, Brighton – $3,000,000
• 26 Stawell St, Kew – $2,950,000

The shoe was on the other foot today – an auction experience.

An auction we covered in Inner Melbourne this weekend* had an opening bid of $2.8 million when some people may have thought $2.2 million was the right money to finish on. The auctioneer almost choked on his gavel and asked for the bid to be confirmed. The buyer confirmed the bid. After a quick consultation with the vendor the property was declared on the market and sold under the hammer for $2.8 million.

Except that the only and ‘winning’ bidder did not sign the contract when asked to do so, and the property is currently still for sale. The auction appears to have been ruined. As we see the facts and as we are told, the bidder should in our opinion face some legal action – although we are not lawyers and we have not heard the bidder’s side of the story.

In this case we have  sympathy for the seller and for the selling agent. But what about the crap buyers put up with every week?

At another auction this weekend** (coincidentally with the same agency), a bidder had gotten a building inspection done on a $1.5m-ish agent quote and turned up to the auction to find that the passed in on a reserve of $2m. Should the agency or the owner be obliged to pay the buyer’s building inspection fees that were done beforehand in good faith? Given that the seller through their agent has misrepresented their position and caused a loss to the buyer, we feel they should. We also wonder whether action should not also be taken against sellers who persist in using agents who continue to behave poorly by step quoting illegally.

So while on the face of it we think what happened today was appalling buyer behaviour, we repeat that we have not heard the buyer’s side.

We are not taking the moral high ground – we cannot afford that sort of real estate. But we are continuing to highlight step quoting and other poor behaviour instances that if left unchecked will damage the auction system that we otherwise so admire for its buyer and seller transparency.

*We have changed the details and removed the auction report to protect the seller’s position, as that is the decent thing to do – the home still needs to be sold.

** Details changed as the property has still not been sold

CANTERBURY, 2 Monomeath Place: The biggest sale of the day, Richard Earle (Jellis Craig), bought after auction above $3,000,000, 1 bidder

Biggest Sale: 2 Monomeath Pl, Canterbury, Richard Earle (Jellis Craig); After auction, in excess of $3,100,000, 1 bidder
A nice sized crowd of about 50 turned up to this auction despite the weather turning sticky and humid. Auctioneer Richard Earle was at the helm but, despite his enthusiasm, the crowd was shy and only one bidder put their hand up to bid. However, this bid was good enough for Mr Earle as he promptly passed the property in to begin negotiations with the sole bidder. Bought after for an undisclosed amount. (Joshua Bong)

Biggest Pass In: 47 York St, St Kilda West, Greg Hocking (Hocking Holdsworth Real Estate); Passed in, $3,800,000, no bidders
Auctioneer Greg Hocking brought his “A grade” preamble to the auction of this fine period family home in St Kilda West, only minutes to the beach and Fitzroy Street. After asking for and receiving no opening bids, Greg placed a vendor bid of $3,800,000, calling for rises of $25,000. Still no interest and half time was called. On returning, still no bids and the property was passed in. (Guy Angwin)

Bidderbuzz Auction: 10 Mills St, Hampton, Rowan Thompson (RT Edgar); Under the hammer $1,325,000, 5 bidders
A nice wide, quiet street, an old property on a big block within 100 metres of Hampton Street shops. What an opportunity! Auctioneer Rowan Thompson thought so too and so did the five bidders who were all anxious to buy this interesting property. Lively bidding became frantic as the auction progressed. The “on market” level of $1,200,000 was soon reached and it was obvious that three parties were particularly keen. The auctioneer would have accepted well over 50 bids in total, many down to only $1,000 at a time. He was really busy! The property was finally knocked down for $1,325,000. A good result. (David James)

Buyer Masterclass: The Risks of Chasing a Housebuying Reward – negotiating on a property is all about balancing the risks with the rewards. Find out more in this week’s Buyer Masterclass.

We Only Buy Homes

Subdued mood: Toorak, 25 Montalto Ave, Jason Scillio (Kay & Burton), passed-in $3,450,000, no bidders

Perfect day, perfect setting. 3/61 Nepean Hwy, Aspendale (Rowan Thompson, RT Edgar). Massive crowd and a picture perfect back drop - but the home still passed in at $3 million.

At 6pm on Saturday, the James Clearance Rate for $M+ was 48% on the 29 auctions we attended.

The Weekly Review Bidderman, our demand indicator, was 1.6 bidders per auction. But that average figure doesn’t tell the full story.

Market Summary

This weekend was a tale of some homes with a lot of bidders and some without any. That’s been happening a bit lately, but in this case the stats were very stark and indicative of what is happening in this market. Of the 26 auctioned homes we attended (3 had been bought before) on this weekend, 5 had a total 27 bidders and possibly more – that’s at least 5 bidders each! There was a total of 14 bidders across the other 21 $M+ auctions – so some of those had no bidders at all.

Of the five homes that had five or more bidders, two sold for over $5 million and two for over $2 million. They were in Carlton, Elsternwick, Surrey Hills, Toorak and Hawthorn

The majority of the other 21 homes had average bidding and passed in. A number of these will remain as passed-in until the would-be sellers realise that while we have a good market at market prices, it’s a very limited market above that. Your best price these days seems to be on the market early and let the bidders decide.

For sellers who have decided to stick to their guns, and let their property pass in – we thought we would go back in time and look at what’s happened to all the properties that passed in on Super Saturday (October 22).

Super Saturday Wash up: 1/3rd of all $M+ homes auctioned have not yet sold
Super Saturday, October 22, was three weeks ago. And just to remind you – the clearance rate on or before the day (October 22nd) was a disappointing and slightly surprising 43%. Of the 47 $M+ homes we reported on, 27 didn’t sell.

So what’s happened since then? Well, despite the racing distractions, a further 11 have sold, giving Super Saturday a thee week clearance rate of 64%. The market is clearly not as strong as it was two years ago when we were seeing 90% clearance rates after this length of time. However it’s nothing like the troubled times in 2008 (GFC).

Basically auction homes are falling into three categories

1. Selling on or before the day – The market priced: A graders and some well priced B graders, where the vendor has quoted conservatively and met the market. There is strong bidding – look again at this weekend’s results.
2. Selling a few weeks after the auction – The risk takers: meaning buyer and seller risk takers. Prices have generally been above the pass-in price but well short of the asking price. The risk for buyers is that someone else buys, and the risk for sellers is that they don’t sell.
3. Not selling within a few weeks – The stales: With family homes the price is either scaring off buyers from making any offers or they’re making an offer usually at a lower price than pass-ins and being rejected. The next likely scenario for the seller is withdrawing their property from the market, sitting there on the net with no action or trying to sell by significantly discounting their original price.

Bayside sellers appear to be particularly bad at pricing their homes to the market. Some of their pricing is fanciful. Looking at the results, an inexperienced onlooker might conclude that the Bayside market is shot to pieces. It’s not: we have Bayside buyers on our books. It’s just that more than a few sellers are so far from where the real market is we’re not sure why they waste their money on advertising.

$3M+ Market continues to produce some results

Non-Auction sales:

• 16 Kenley Court, Toorak, (Michael Gibson of Kay and Burton) – sold for over $12 million for nearly 2000 sqm of land and a very substantial home. James Home Rating 779/1000.
• 24-26 Balmerino Avenue, Toorak, (Justin Long of Marshall White and Hugh Hardy of Bennison Mackinnon) – 1850 sqm of land including tennis court. Passed in at the Thursday afternoon auction for $7,000,000 and bought immediately after for an undisclosed amount. As I went through this home it felt mostly about the land and the sweeping views, however I suppose that is the way with almost all Toorak homes. The end result was $3,800 per sqm approx.
• 4 Lisbuoy Court Toorak, (Nicole Gleeson and Michael Gibson) – Townhouse with some land for over $4,000,000.

Auction Sales:

• 47 Kinkora Road Hawthorn, Peter Batrouney (Jellis Craig); Under the hammer, $5,660,000, 4 bidders (see report below)
• 49 Mathoura Road Toorak, Justin Long: Under the hammer, $5,220,000, 5 bidders

‘Round the Grounds

• Boroondara – Not much better than last week and not as good as it was – 53%
• Stonnington – Reasonably Solid and 64%
• Bayside – There continues to be minimum buyer and seller price matching – 44%

HAWTHORN, 47 Kinkora Rd, Peter Batrouney and Campbell Ward (Jellis Craig). The grand old home in the Grace Park estate was bought under the hammer, $5,660,000, 4 bidders

Biggest Sale: 47 Kinkora Rd, Hawthorn, Peter Batrouney (Jellis Craig); Under the hammer, $5,660,000, 4 bidders
Grace Park, north facing rear, big land and beautiful period home. Some may say a drover’s dog could sell this on a sunny day, but that would be unfair on Peter Batrouney and Campbell Ward. This writer knows for sure we will get a first rate performance and in all likelihood a very solid result. About 120 have gathered in the back yard and we begin with a vendor bid of $5,000,000. Quickly in $50,000s between Bidder 1 and Bidder 2 we reach $5,300,000 and a half time break. 2 more bidders join in and it’s on the market at $5,500,000. A few up bids and she all stops at $5,660,000. A typical successful Peter Batrouney and Campbell Ward / Grace Park auction. (Mal James)

Biggest Pass In: 3/61 Nepean Hwy, Aspendale, Rowan Thompson (RT Edgar); Passed in $3,000,000, 1 bidder
The excitement was in the air and the house was buzzing with people enjoying the sunshine and the stunning panoramic view of the beach literally on the doorstep.  With only 500 beach front homes in Melbourne, explained auctioneer Rowan Thompson to the large crowd of 100, the “international standard resort style” property represented  a wonderful opportunity.  Mr Thompson opened proceedings with a vendor bid of $2,800,000 and sought $100,000 rises.  With Mr Thompson’s encouragement, a bidder from the crowd obliged with a bid of $2,900,000.  A vendor bid of $3,000,000 followed and despite Mr Thomson’s best efforts, there was no further bidding on the day and the property was passed in on the vendor bid.  (Kate Agnoleto)

Bidderbuzz Auction 1: 539 Canning St, Carlton North, Tom Roberts (Nelson Alexander); Under the hammer $1,300,000, 5 bidders
This auction was going to be the hottest of hot with a very conservative quote at $900,000 to $990,000 and a wonderful A grader on offer. 539 Canning was always about width and side access and at 6.5m, with lane at the side this renovatable period home was as good as is offered in this area due to the ongoing options it provides. Around 100 or so people turned up in anticipation to see what auctioneer Tom Roberts was going to extract in the end.

After the usual Robert’s spiel we were away instantaneously with a 950 then 960 then $1million bid all within 10 seconds. Twenty seconds later we were on the market at $1,050,000 and then past that to $1,080,000.

One bidder, Chris Koren of Morrell and Koren, was leading the bidding in strong style – coming back at each and every bidder quickly and assertively. It was textbook bidding and he is a master at this when he is on his game, as he so obviously was today. At $1,180,000 the fifth bidder, also an advocate, joined the battle. At this stage we had dropped to $500s and $1000s and with both advocates firmly positioned it looked like this was going to be a long and drawn out battle. And so it turned out to be – with auctioneer Tom Roberts taking a back seat, allowing Chris with his strong and firm style to battle it out with Guy Angwin (from our company). The two advocates continued past $1,200,000, then $1,240,000 and then $1,275,000 – at each milestone getting crowd applause like they were witnessing a momentous MCG event.

Eventually at $1,300,000 Chris Koren who had led the auction all the way, was declared the victor and a deserved one at that. Commiserations to the underbidders. The eventual buyers bought well and not over the top either. Our estimates at a strong auction were $1.2m to $1.3m for this prime A grader – a far cry from the 900k to 990k quote. But no complaints re underquoting as the home was on the market quickly. (Mal James)

Bidderbuzz Auction 2: 29 Guildford Rd, Surrey Hills, Jeremy Desmier (Fletchers); Under the hammer $2,185,000, 7 bidders
The auction of this property had a fractious beginning when four different parties all asked questions of auctioneer Jeremy Desmier ranging from – “are there easements?”  – “is the property subject to Heritage overlays?” -  “can I demolish?” – “what are the land tax implications?”. The tone was set – this was going to be war with seven bidders all trying to buy this rough diamond just waiting to be polished. Consistent with all the initial interest, a genuine bid of $1,500,000 started proceedings, soon followed by two other bidders looking to control the auction. Just when you thought this bidding war was losing momentum multiple bidders joined in and for the next twenty minutes strategies were put to the test.  Eventually the property was bought for $2,185,000, a very entertaining auction from beginning to end. (Guy Angwin)

The Big Issue Video: The Big Issue is back! Click on the video for the late Spring mail.

Buyer Masterclass: Negotiating on a property is all about balancing the risks with the rewards. Check out this week’s Buyer Masterclass – The Risks of Chasing a Housebuying Reward.

We Only Buy Homes

GLEN IRIS, 22 Wilson: The Abercromby's team, Rob Vickers-Willis, Andrew Harlock and Tim Derham marching out for some action. Bought after auction for an undisclosed amount above $1,900,000.

Negotiating on a property is all about balancing the risks with the rewards. In your quest for the reward of buying your dream home, you might run the risk of paying more than you needed to. But focusing purely on the reward of paying a lower price for a home might raise the risk that another buyer trumps you and you miss out on the house you love.

Let’s look at a couple of scenarios, and the risks and rewards they might raise:

Buying Before Auction

Let’s say you decide to make an offer before auction. Making an offer early gets rid of the competition that hasn’t yet made itself known to the selling agent. It can also work because selling agents are unlikely to recommend against an offer that has some grunt about it. At auction day they don’t want egg on their face.

If your offer is accepted, the reward is that you get the main prize, your new home. The risk is you may have paid more than you needed to had you waited till auction. Of course if you are successful you will never know – you can congratulate yourself and nobody can argue the toss with you.

But there is also a risk that your pre-auction offer may not be accepted, but instead be used (correctly and ethically) by the selling agent as a price floor when it comes to auction day – not only for you but for other buyers too.

Overall going early is a strategy we favour only when you have done your due diligence and you believe that the genuine expected price (not the agent quote) is at market value and close to your budget limit. Going early involves a bit of smoke and mirrors and we feel relatively comfortable in that domain. If you don’t then waiting till the auction may be your best bet.

Private Sale Negotiations

When the asking price of a quality home drops from $2 million to $1.8 million due to some tough negotiation most buyers think they are now in a better risk v reward position to buy the home. But if you offer, say, $1.7 million at this point you can put yourself at the risk of missing out on the home. That’s because other buyers may now appear who consider $1.8 million a good price and may be prepared to pay $1.85 million.

Alternatively not trying to lower the price on an overpriced home is also a risk – especially if the home is a B grader. When there is little proof of market competition – in a private sale or vendor bid pass-in – you may end up overpaying. In time that will affect your resale, adding risk to the long term financial benefits of the deal.

On the other hand in a flat and falling market it may be quite a low risk to walk away from an asking price or a pass-in figure that seems very, very high – even if you love the home – as there is little chance of another buyer.

But in other scenarios there is a risk walking away from a home you love, just because you’re reluctant to pay a few thousand dollars extra. Say a property you love has been passed in to you as the highest of three bidders at an auction – why would you refuse to budge on your last bid, even though it was only $1,000 above the other bidder? Sticking to your guns may only mean the underbidder gets a chance to buy and you miss out on a home you really wanted.

Another additional risk buyers often take for no reward is walking away from the auction on Saturday, only to pay the reserve on Monday anyway. The most common time for a deal to be done after a pass-in is that same weekend. So, if you are happy to pay the price why not just buy it on the Saturday rather than run the risk of someone else buying it that weekend if buying the home is your main goal?

At the end of the day, any homebuyer has to take risks to get rewards – unless you have a policy of only going after homes that nobody else bids on. And buying a home that nobody else wants is not a great strategy for good long term emotional and financial outcomes.

Printed each week in The Weekly Review – Melbourne’s $Million Plus property magazine.

I love you darling and thanks for buying this nice little $6 million beachfronter. 2 Mytton Grove, Brighton. Greg Costello (RT Edgar), under the hammer, $6,050,000, 2 bidders.

At 6pm on Saturday, the James Clearance Rate for $M+ was 50% on the 28 auctions we attended. What made the difference between those that sold and those that didn’t? As with most of this year’s market, quality properties priced to market sold, while those off the boil on price and quality didn’t.

The Weekly Review Bidderman, our demand indicator, was 1 bidder per auction. There was only one volcano (4+ bidders) out of the 28 auctions we attended and more than a third were duck auctions (no bidders). This has been this way for most of Spring and a clear indicator that we are now in a falling market, price-wise.

Market Summary

Timing: We know we shouldn’t raise the Santa stuff just yet, but effectively you have just three more weeks of new advertised stock and then another couple of weeks of mop ups and off markets (that are due for a February auction). And then the big hairy, bearded man is here with his unquarantined animals and pressies.

Stock Levels: So how are stock levels right now and what is the action like?

We were initially tempted to give reporting a miss this weekend as there were only 55 scheduled auctions over $1m. But upon some analysis we were able to find 30 reasonably good homes which we felt gave us a good sample.

Over the next two weeks around 80 auctions (each week) are scheduled at $1m or more. The last week in November does have closer to 100 scheduled, but effectively we have had only one Spring weekend in excess of the 100 auctions that signals a solid day in Bayside and the Inner East. So please send food parcels to your favourite selling agent – as both turnover and clearance rates are down to low lows. However we are finding there are homes to buy, there is good stock out there and more so than a month ago. For this to be the case there must also be falling demand otherwise you would not be seeing falling prices on reduced stock levels. But it is not exactly a free-fall as we are still getting beaten now and then at auctions (when we have to go there) – not by highly priced sellers, but by other buyers.

Previously Negative Sentiment: The last two solid auction weeks – Super Saturday (October 22) and then way back to Preliminary final day (September 24) – were negative for both buyers and sellers in all parts except Boroondara council. They were negative because of low clearance rates – indicating minimal price agreements between buyer and seller.

Correct Pricing: Having said that we can’t help but feel the market is a fair way off its knees. Yes prices are falling – of that there is no doubt and they’re falling quite substantially, up to 10% in the last few months on many homes, even some of the good ones. But – that’s right there’s a but – if the vendor falls in with the market then there are bidders. So the market is not toxic, it’s just in a downward phase. It is in fact a good buyers’ market if choice and falling prices are your definition of a good buyers’ market .

A classic case is 24 Roslyn St Brighton (Stephen Tickell). Bought in June 2007 for $2.3m, last year its owners tried to sell at $2.7m-ish with no takers. This weekend it was back on the market with a quote of $2m+ and, guess what, with two strong bidders it sold for exactly what was paid 4 years ago towards the end of the 2007 bull run. Which demonstrates our point that the market is operating as markets do: they correct and they go up and down.

Wormie: People keep asking how prices are going at the Top end, so we decided to bring Wormie back. This is our best effort at graphically representing where we think the Top End market has gone over the last few years. It’s not an exact science – it’s our opinion.

$3M+ Market: Has the action returned after the September excitement was followed by an early October siesta? We think yes – it is back. People do have cash and they are parting with it when they find the right home. In the last 10 days at least 9 homes over $4 million have been bought and sold. So it’s not dead at the Top End by any measure.

Some Auction Results today

• 2 Mytton Grove, Brighton, Greg Costello (RT Edgar), under the hammer $6,050,000 – 2 bidders
• 15 Dudley St, Brighton, Leigh Hallamore (Buxton), after auction $4,000,000+ (undisclosed) -0 bidders
• 15 Chastleton Ave, Toorak,  Warwick Anderson ( RT Edgar), under the hammer, $4,135,000 – 4 bidders

Pass-Ins

• 58 Kooyongkoot Road, Hawthorn – $3,400,000 – 0 bidders
• 51 Cookson Street, Camberwell – $2,850,000 – 0 bidders

Expressions of Interest: The $3M+ market is not all about auctions. In October the selling agent’s weapon of choice for selling properties above $3m and particularly above $5m moved from Auction to Expressions of Interest. Many EoIs were scheduled for completion either side of the racing carnival. Some results are in from our 8 randomly selected EoI campaigns.

We have been to the above homes. Check out our ratings on 25 Scott Grove Glen Iris (791/1000) and 33 Coppin Hawthorn (812/1000) which we have made available to the public. Just Google the address and you will see our James Home Rating.

Tennis Anyone?! Excerpt from October 15th James Marketnews: ”Want a home with a Tennis Court in Toorak? Got around $6 million dollars? In the last week we visited, assessed and rated: 11 Scotsburn Toorak (Andrew Smith), 10 Montalto Toorak (Mike Gibson) and 25 Scott Glen Iris (Rae Tomlinson). All have tennis courts.”

The $6M Question: After Super Saturday would these three not sell, sell lower or would the Mexican Wave** kick in (see explanation below) and all would sell once one had gone?

The $6M Answer: The Mexican Wave did in fact kick in with all three selling within 24 hours of each other. All three had quotes of $5m to $6m during their campaigns. Scotsburn was bought after a weekend pass-in (over $5m), Montalto was for most of its campaign a private sale, but finished in a Boardroom Auction at just over $7m. Scott Grove was an Expressions of Interest closing Wednesday (with reportedly three interested parties) and sold 2 hours after the deadline for well over $6m.

**Mexican Wave: It’s just like at the MCG: Kay and Burton brings a group of homes together and they push and prod till they get one buyer to perform and then uses that result to get other buyers to put their hands up on other homes. This is planned months beforehand. It’s totally legitimate and it’s brilliant in concept.

RT Edgar: Has had a pretty solid time with 8 properties selling over $2 million in less than a week, including an off market at 68 Walsh St believed to be around $4 million, not mentioned in above dispatches.

Auctioneers: We love a good auction and we love giving good auctioneers a rap. But this weekend we saw a number of so-so performances. Good auctioneering makes a difference to the end result, so when you see confusion and lack of excitement and dragged out ineffective begging you wonder just how much the seller is losing. It’s hard to prove, but logically if you are told the good auctioneers bring in the dollars, then the poor ones must be losing them out the other end. Auctioneering, like buyer and seller agency work, is not a 5 minute skill that anyone can do who has a loud voice.

Growling Jack - behaving well: Jack Bongiorno (Marshall White) at 50 Stuart, Armadale. Bought after auction for an undisclosed amount above $2,200,000. 2 bidders.

‘Round the Grounds

• Boroondara – Is Boroondara Moving off solid onto a Roller coaster? – 44%
• Bayside – Some strong results on the Golden Mile – 53%
• Stonnington – Was anybody still left in Malvern today or were they all at the races! – 33%
• Port Phillip – Not Much Happening

Biggest Sale: 2 Mytton Grove, Brighton, Greg Costello (RT Edgar); Under the hammer $6,050,000, 2 bidders
Brighton Golden Mile Beachfront – these are four words that mean money. In recent times that has meant $8000 to $10,000 per sqm – at least at the northern end. A question our auctioneer Greg Costello asked in his opening spiel was “is this southern part of the Golden Mile more highly regarded than the northern part due to the activity on the beachfront?” Personally, as I run past here every day I think yes, but the auction result will tell us for sure. With the blue sea as our backdrop I’m expecting an exciting auction – irrespective of the market this stuff always sells. Greg Costello is conducting proceedings in front of a small crowd of 30. We start with an opening bid of $4,850,000 from Bidder one. $5,000,000 comes in from Bidder two strongly – solid bid. $5,100,000 from a third bidder – who as it turns out was with Bidder one – so we don’t count him – strange strategy that one. Anyway with a fair bit of action we move up to $5,600,000 in various amounts and then to $5,750,000. At all times Bidder two looks in control and is bidding very well and with some intimidation without being over the top. Normally Greg Costello is in excellent form but today was not his best day with bid retention and there are a number of confusing referrals back to his penciller for clarification. At $5,900,000 the “is it on the market?” question was asked, and after a quick referral, an affirmative answer is returned. There are two more decisive bids from Bidder two and its all his at $6,050,000. Loved the winning bidder’s style – aggressive and sensible and much better than his opponent and also many so called professionals that I have witnessed recently – well done sir – we have a job for you here if you care to apply. (Mal James)

Other Brighton Golden Mile Results: 2 Mytton at $6,050,000 divided by 613 sqm = $9,869 per sqm or almost identical tor previous absolute beachfront sqm rates over the past year (which have maintained themselves in the last year and increased on previous high water marks). 8 Moule Avenue (David Hart) is a classic Golden Mile address (but not absolute beachfront) and sold this weekend for $2,310,000 or $3,510 per metre which on first glance is not expensive but in fact is not too far off previous Golden Mile sqm rates. A third Golden Mile property 15 Dudley St (Regina and Brian) sold for in excess of its pass-in figure at $4,400,000 which again considering the house was nothing other than a nice facade was a very, very solid result.

Biggest Pass In: 58 Kooyongkoot Rd, Hawthorn, Scott Patterson (Kay & Burton); passed in, $3,400,000, no bidders
Could you find a better setting for a Melbourne Spring auction? A tranquil backyard by the pool! In front of around 60 people, auctioneer Scott Patterson gave his usual professional best to attract some crowd bidding but this was to no avail. The property passed in after two vendor bids – $3,300,000 and $3,400,000 respectively – and remains for private sale. (Adam Woledge)

Bidderbuzz Auction: 15 Chastleton Ave, Toorak, Warwick Anderson (RT Edgar); Under the hammer, $4,135,000, 4 bidders
Spirited bidding after a slow start was a welcome sequence at the auction of this single level home in Toorak. A crowd of 80 neighbours chatted quietly throughout the action, eagerly anticipating the value to be determined by the market. After opening on a vendor bid of $3,400,000 and the declaration that the council had valued the property at $3,700,000, auctioneer Warwick Anderson tried to keep pace with the determined 4 bidders. After the second vendor referral, Warwick announced the property on the market at $3,800,000 but the strong bidding continued, with bidder number 4 securing the home at $4,135,000. (Gina Kantzas)

Buyer Masterclass: “Risks of Chasing a Housebuying Reward”. Read the article in The Weekly Review or our Buyer Masterclass.

We Only Buy Homes

The crowd of around 50 clamber for some shade at 8 Moule, Brighton. Leigh Hallamore (Buxton), bought after auction, $2,310,000, 2 bidders