Upper Market Improving ?
by Mal James & Gina Kantzas
6:00pm Saturday, what a week!
We do understand for many, there are way more important things going down than our take on the Inner Melbourne high end market.
We sympathise that whilst we talk of stronger bidding and bigger prices on A-grade homes – many are doing it very tough in Melbourne.
However, for us, the high-end property market is both our business of buying and selling and a pointer for better things to come.
We feel the upper middle market ($3m to $6m) is actually improving, not weakening – when compared to early Covid.
As with our Brighton Booming last week, this week we have continued to focus on good things.
These 3 separate deals, with 3 separate agents in 3 separate areas away from Brighton, with 3 different types of homes, along with a number of others, came across or involved us directly, this week.
And whilst we wish to report a kind of truth in the market as we see it – we have always been more interested in the journey today, more so than any predicted result tomorrow. Why? Well for most pundits, tomorrow never comes.
And almost finally, if we have to give you some punditry (is that a word?) then we’d rather be an unsuccessful and criticised optimist than a righteous, faultless pessimist.
When it comes to our society and in particular to Inner Melbourne property, we may not see things as some may and that’s ok.
Because we feel it’ll be ok, either way.
Some riders on our examples below.
- We are July in Winter on very low stock. For our word improvement – it’s off a low and previously negative/falling base.
- We have cherry picked some positive examples and
- Not representative of the whole market – they are little micro markets.
Volcano – 5 bidders – $1.4million over reserve.
Above is a text exchange with a third party.
Upper End Market Mood
The lower part of the Upper Market ($1m to $2m) has always had some strength – all through Covid.
The middle part of the Upper Market ($3m to $6m) has clearly lifted in terms of people willing to act, deals being done and general sentiment when you compare now (July Winter) to Post Easter (which was a shocker)
The upper part of the Upper Market ($8m and above) is still stalled with only the occasional deal – a number of offers and counter offers have distance between them – overall very few results.
7 days got 4 Bidders, $300K over, on off-market.
- ISP: $2.2m to $2.4m
- Land size 668 sqm
- Great facade but in need of a serious reno = $1million plus
- Last Saturday – 1st open and we went through
- 4 offers and 3 Building inspections
- Contracts and On-market offer at $2.4million yesterday
- Three offers over $2.65m
- Sold today – 8 hour ring around phone auction for over $2.7m
Upper End Guidance
Sellers: Good $3m – $6m homes that are well priced and marketed (with or without advertising) can and are selling better than two months ago.
Buyers: If you see an A-grader – good PPP’s – then up to $6million you can reasonably expect some competition and it could be strong.
Market watchers: The market really is very much made up of many micro deals and each deal is in itself its own market story – there are simply no blanket rules right now – meaning no blanket positives, but equally no blanket negatives.
Canterbury 6 Bidders – $420,000 more.
Home Expert in 6
The Game (Melbourne Edition)
Name: Home Macros v Micros
Players: Anybody can play at any home buying or selling level.
Score: It’s a game with points or else we’re not playing. Winners and Losers – yes!
Rules: Rule 101 in property. Better questions ahead of better answers drive better strategies for better financial and emotional recoveries/outcomes from now, post Covid.
Season: 6 rounds over 6 Covid weeks with finals and a premiership – beginning next week.
And it’s real – its practical – real names, real people, real homes. Maybe that’s a dumb idea.
No. We haven’t worked it all out yet!
Some training for you for next week, while you’re warming up – go weird, no normal thoughts allowed.
Micro
Here is a micro starter question. If I lose 10 kilos can I get a better home loan? If I eat broccoli will I desire tessellated tiles less, meaning my spouse stays home more as our mortgage is lower, meaning we talk more and meaning I don’t need a new home in 5 years to make me happy, meaning we pay off the mortgage quicker. OK we need to work on the questions in the next week?
Maybe let’s focus on 3 areas
- Property Knowledge
- Property Fitness and
- Property Health
Macro
Here is a macro chicken or egg starter 3 question set.
Is it belief, trust and fluidity that brings a market rise or is it a rise that brings belief, trust and fluidity?
Another version of this question is the old demand and supply question that Adam Smith pondered over, all those years ago. Huh, what do you mean? With a beautiful garden – is it demand for or supply of that initially drives the price of that home.
Another question sort of related. Are our property actions driven by our limbic and our logic comes along screaming and then settles; or is it our logic that deals with all things external such as position, property and price – mixes it in with economics, jobs and media and then for the most part manages our limbic into the back room, as it takes a sound position at the head of the table?
You’re right Mal, Gina, Sim, Kathy, Phoebe, Randall, Mads and …. that’s weird.
See you next week!
PS Yes, we are still working at James Buy Sell – we’ve averaged a home buy or sell a week over last two months, after the initial pause and yes, we are down on last few years – however it’s still all about putting buy sells together that work – and yes some are in new ways.
We are following Dan’s rules and with less travel we’ve been able to watch Longmire, Line of Duty and two seasons of Narcos – anything else our team should be aware of?
Why James?
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