Who Cares

by Gina Kantzas, Mal James, Randall Smith, Simone Clarke, Catherine Ross, Jo Gallagher, Kathy Russell, Phoebe James, Maddie James, Ellen Russell

Saturday, May 15th, 2021

5 Thomas Street, Kew
Auctioneer: Scott Patterson
Crowd: 80
Opening Bid: $3,800,000 VB
On the Market: $4,160,000
Under the Hammer: $5,010,000
Bidderman:  Volcano 4

Who cares how hot or not the Melbourne market is?

We do – but only sometimes.

 

Sometimes for buyers and for some sellers we really do care, however for most buyers and sellers we really don’t care about market heat – well not that much, well not as much as the headlines make you feel we should.

 

Why don’t we care as much as the market hype says we should?

 

Why not?

 

Because your result is rarely totally dependent on the state of the overall Melbourne market.

 

There are other factors, often more important than say market heat.

 

Hot market – hot result – but was it the market that gave the hot result or another factor?

 

These examples below are just as much about buying as selling.

 

Story One

 

An individual transaction circumstance can be far more important than the “hots” of the overall Melbourne market

 

Look at last week in our $570,000 Hampton presentation improvement example. The market was similar pre-Easter to post-Easter, but at Orlando St the individual presentation circumstances were very different. It was the individual circumstances more than the hot market that delivered the stellar result. Basically, an 80% profit improvement in 5 weeks – the overall market didn’t go up 80% in 5 weeks and wasn’t as important as getting the presentation right.

Story Two

 

Market segment PPP fundamentals can be far more important than market strength.

 

Today Maddie James’s first sell auction with Daniel Joyce of Jellis Craig resulted in a 4-bidder volcano. Record price for the block, in a hot market. Stellar result in a hot market – but would the client’s investment result have been better with different market segment PPP fundamentals rather than a hot market?

 

  • Since 2001 the apartment had a capital growth of $635,000 (sell) / $259,000 (buy) or 245%. That’s actually good, relatively speaking for apartments.

 

  • Since 2001 an average home with land in Melbourne has gone from $185,000 to $1,000,000 or 540%. Melbourne median price.

 

So as an investment or first home, the state of the overall market was small beer compared to the chosen market segment PPP’s. Still a bloody ripper result though Maddie and Daniel!

Story Three

 

However, the overall market strength can be more important than individual circumstance or the chosen market segment sometimes and nowhere more so than the Ultra Top End, where for much of the market cycle, the buyer air is thin.

 

The Top End deals we were involved in March – 3 over $10m – hand on heart, would not have taken place outside a hot market. The hot market created the deal atmosphere and as well brought other stock out for the sellers to see (further encouraging the buy sells).  At the top end where you don’t have to sell, it can be all about the market.

This is what determines your result buying or selling

  1. The overall market AND
  2. The market segment PPP Fundamentals you chose initially AND
  3. The individual circumstances of the buy sell within the market.

 

It’s a combination of all 3.

 

However, if we had to pick one – we would pick market segment PPP fundamentals as more important to price and growth than the overall market strength or the individual circumstances of the buy sell.

 

So, we care about the market but not that much.

Huh? What are PPP Fundamentals again?

Position: Near a train with some land.

Property: In a livable floorplan with light and feel

Price: That you bought near median price, for area type

AND one more P

Personal: You like it, so you never move, never pay more taxes and more agent fees again.

 

The Overall Market temperature is important but it’s not the be all and end all – we think PPP segment fundamentals chosen are far more important and today again proves that.

22 Hilda Street Malvern East

Auctioneer: Andrew Hayne

Crowd: 60

Opening Bid: $2,800,000

On the Market: $3,400,000

Under the Hammer: $3,450,000

Bidderman: 3

The May Market Test

Market watchers will be looking forward to the next three weeks.

 

May traditionally is the most volatile of months (along with October), due to the highest supply levels (houses on market) and a clear buy/selling runway (no holidays).

 

May is a month of change or a month that indicates clearly there has been a change.

 

Today we start the measuring of 100 random Top End auctions over a 3 week period for homes in the Boroondara, Bayside (inc Port Phillip) and Stonnington areas. We measure 4 times a year and compare to past periods and last year same period.

 

It is scientific in that we track down every result and it’s a random within our PPP criteria

 

Measurements

 

  1. Bidderman (Demand)
  2. Clearance (Price)
  3. Stock Levels (Supply)

 

By end of May 2021 we can answer some questions?

 

  • Was our Opening 2021 Market a breaking of the shackles of Lockdown or are we now on a longer term upwards trajectory.

 

  • What is happening in the market now – really happening now – not spin.

 

  • On the balance of probabilities what will happen later in the year (but we really don’t know for sure).

 

May is a key month – it’s relationship with Spring

May 2020 no market (but building prior to lockdown). Late Spring it was on fire.

May 2019 stable or balanced market but on low stock and it remained stable in Spring

May 2018 very poor market and it remained very poor in Spring

May 2017 strong market, but easing and kept easing in Spring

May 2016 booming and kept booming in Spring

May 2015 booming and kept booming in Spring

May 2014 strengthening and kept strengthening in Spring

6 Ferndale Road, Glen Iris

Auctioneer: Davide Lettieri

Crowd: 90

Opening Bid: $3,500,000

On the Market: $3,650,000

Under the Hammer: $4,600,000

Bidderman: 3

Melbourne Market Top End May 15th – Week 1 of 3

Clearance rate 75% Bidderman 2.2 Prices Still Increasing

This is a solid start to the big month of May. Prices on A-graders are still increasing!

 

Is the intensity of March still there, maybe not, but it’s not too far off at 75% clearance and even if it’s not as strong, it is still going up according to the 33 auctions we sampled and reported on today.

 

Bidderman at 2.2 means more than one wounded underbidder per auction. Those wounded underbidders will try harder next time and prices will rise through their hurt, until most are satisfied or stop.

 

Volcanoes were 6/33 and ducks were about 50% – which means there is potential for volatility as the spread of bidders is mmmm, not sure – early days to call the May market a super hottie – but for A-graders in the $2m to $6m range it has started at or close to where the pre-Easter market left off. At $10m plus is doesn’t feel as much buyer interest as it did.

 

Market Segments – Position

  • Bayside was as icy as the bay today.
  • Boroondara was scorching and made the overall market look good – and it is clear why – OS money has been back since Lockdown.
  • Stonnington was asleep auction wise.
Reading on phone – turn to landscape to see full table
Suburb Address Indicative Sale Price Result Price ($) Bidderman
BRIGHTON 2 Cadby Street $4,000,000 – $4,400,000 Bought Before $ undisc 1
ELWOOD 11 Bendigo Avenue $3,900,000 – $4,290,000 Bought Before $ undisc 1
BRIGHTON EAST 18 Plunket Street $4,300,000 – $4,500,000 Bought Before $ undisc 1
BRIGHTON 2 Cowper Street $2,750,000 – $2,950,000 Under the Hammer $3,290,000 3
HAMPTON 14 Alicia Street $2,700,000 – $2,850,000 Under the Hammer $2,970,000 2
HAMPTON 16 Lansdown Street $2,800,000 – $2,900,000 After Auction $3,000,000 1
BRIGHTON 17 South Road $3,500,000 – $3,750,000 Passed in $3,750,000 1
BRIGHTON 2 Campbell Street $2,850,000 – $2,950,000 Passed in $2,800,000 0
SANDRINGHAM 6 Mock Street $2,350,000 – $2,500,000 Passed in $2,350,000 1
BRIGHTON 60 Roslyn Street $3,000,000 – $3,200,000 Passed in $3,000,000 0
MIDDLE PARK 312 Danks Street $7,000,000 – $7,400,000 Under the Hammer $7,900,000 3
MIDDLE PARK 339 Richardson Street $3,800,000 – $4,000,000 Under the Hammer $4,200,000 3
BALACLAVA 6 Camden Street $1,950,000 – $2,000,000 Passed in $1,950,000 0
ELWOOD 36 Ruskin Street $2,750,000 – $2,900,000 Passed in $2,750,000 0
ELWOOD 84 Marine Parade $2,900,000 – $3,100,000 Passed in $3,000,000 0
KOOYONG 15 Talbot Crescent $3,300,000 – $3,600,000 Bought Before $ undisc 1
MALVERN EAST 22 Hilda Street $2,750,000 – $3,000,000 Under the Hammer $3,450,000 3
ARMADALE 36 Mercer Road $5,000,000 – $5,500,000 After Auction $ undisc 2
PRAHRAN 62 & 62A Victoria Street $2,550,000 – $2,805,000 Passed in $2,000,000 0
KEW 20 Coleridge Street $3,000,000 – $3,300,000 Bought Before $ undisc 1
KEW 5 Thomas Street $3,600,000 – $3,860,000 Under the Hammer $5,010,000 4
KEW 17 Second Avenue $2,400,000 – $2,640,000 Under the Hammer $2,810,000 2
HAWTHORN 35 Melville Street $2,080,000 Under the Hammer $2,305,000 3
CAMBERWELL 72 Bowen Street $2,800,000 – $3,000,000 Under the Hammer $4,007,000 4
CAMBERWELL 20 Kalang Road $1,900,000 – $2,000,000 Under the Hammer $2,251,000 3
SURREY HILLS 15 Langford Street $2,700,000 – $2,900,000 Under the Hammer $3,176,000 5
BALWYN 8 Wills Street $2,800,000 – $3,000,000 Under the Hammer $3,924,000 7
GLEN IRIS 6 Ferndale Road $3,500,000 – $3,800,000 Under the Hammer $4,600,000 3
HAWTHORN EAST 128 Victoria Road $3,100,000 – $3,400,000 Under the Hammer $3,915,000 8
KEW 10 Edward Street $5,000,000 – $5,500,000 Under the Hammer $5,900,000 6
HAWTHORN EAST 27 Ryeburne Avenue $4,800,000 – $5,280,000 After Auction $ undisc 1
GLEN IRIS 21 Iris Road $2,600,000 – $2,800,000 After Auction $2,800,000 2
KEW 32 Sackville Street $3,500,000 – $3,800,000 After Auction $ undisc 1
      75%   2.2

5 Thomas Street, Kew

Auctioneer: Scott Patterson
Crowd: 80
Opening Bid: $3,800,000 VB
On the Market: $4,160,000
Under the Hammer: $5,010,000
Bidderman: 4

The auction took off in a two-way battle with a cameo from a third bidder. ‘Where’s your husband?’ enquired auctioneer, Scott Patterson, as Bidder 2 made a phone call to her other half. ‘He’s at another auction’, she replied. When Bidder 4 swooped it was game over.

17 Second Avenue, Kew

Auctioneer: Davide Lettieri

Crowd: 40

Opening Bid: $2,500,000

On the Market: $2,750,000

Under the Hammer: $2,810,000

Bidderman: 2 

First bid was placed at $2,500,000. The second bidder joined the auction with a bid of $2,525,000. The two battled it out in a quick auction where the first bidder emerged successful and bought the home at $2,810,000. 

35 Melville Street, Hawthorn

Auctioneer: Scott Patterson 

Crowd: 40

Opening Bid: $2,000,000 

On the Market: $2,220,000

Under the Hammer: $2,305,000

Bidderman: 3

Auctioneer Scott Patterson called for opening bids and an even $2,000,000 started the ball rolling. The property was declared ‘on the market’ when bidding between 3 parties reached $2,200,000, with the hammer falling on $2,305,000. 

72 Bowen Street, Camberwell

Auctioneer: David Gillham 

Crowd: 70

Opening Bid: $3,000,000

On the Market: $3,400,000

Under the Hammer: $4,007,000

Bidderman:4

This auction saw a frenzied bidding war between 4 bidders; once auctioneer David Gillham opened the proceedings with a $3,000,000 bid, it was game on! A fast-paced affair, the bids came in thick and fast, far surpassing the reserve of $3,400,000. What seemed like mere minutes later, Mr Gillham slapped down the contract on $4,007,000.  

20 Kalang, Road, Camberwell

Auctioneer: Campbell Ward 

Crowd: 30

Opening Bid: $1,800,000 (vendor bid)

On the Market: $2,050,000

Under the Hammer: $2,251,000

Bidderman: 3

Auctioneer Campbell Ward kicked off proceedings with a vendor bid of $1,800,000. 3 bidders participated, with one bowing out, only to re-enter the fray later in the proceedings with $2,250,000. Ultimately, the property was won by another bidder though, after a spell of small ($1,000) bidding increments took the sale price to $2,251,000.    

15 Langford Street, Surrey Hills

Address: 15 Langford st Surrey Hills

Auctioneer: Ross Stryker 

Crowd: 80

Opening Bid: $2,650,000

On the Market: $2,980,000

Under the Hammer: $3,176,000

Bidderman: 5

No sooner had auctioneer Ross Stryker asked for an opening bid, when the first bidder spoke up with $2,650,000. There was a brief stall when bidder 2 entered, however this was not to last – a third, fourth and fifth bidder would also try their luck. Proceedings became heated towards the end until the property reached the $3,170,000 mark. Only small increments ensued after this, and eventually Mr Stryker knocked it down at

8 Wills Street, Balwyn

8 Wills Street, Balwyn

Auctioneer: Scott Patterson (Kay & Burton)

Crowd: 60

Opening Bid: $2,800,000 (vendor bid)

On the Market: $3,150,000

Under the Hammer: $3,924,000

Bidderman: 7

The first time this home has ever been sold (it was built in the 1940s). On the market quite quickly then, fresh bidders continued to add spice.

6 Ferndale Road, Glen Iris

Auctioneer: Davide Lettieri

Crowd: 90

Opening Bid: $3,500,000

On the Market: $3,650,000

Under the Hammer: $4,600,000

Bidderman: 3

The auction commenced with a strong bid of $3,500,000. Bidder 2 quickly followed with a bid of $3,525,000. The two battled it out with the inclusion of bidder 3 at $4,370,000. The home was then knocked down to bidder 1 at $4,600,000

128 Victoria Road, Hawthorn East

Crowd: 40 

Opening Bid: $3,450,000

On the Market: $3,500,00

Under the Hammer: $3,915,000

Bidderman: 8

The auction was underway with an opening bid of $3,450,000. With the next bid at $3,500,000 the house was declared on the market. Multiple bidders battled it out for the home with the eighth and final bidder swooping in with their first bid to buy the property at $3,915,000. 

10 Edward Street, Kew

Auctioneer: Scott Patterson

Crowd: 86

Opening Bid: $5,000,000

On the Market: $5,425,000

Under the Hammer: $5,900,000

Bidderman: 6

Two bidders took it on the market in a relatively tidy manner, laying the foundation for a few others to step up. Steady bidding and a good-natured atmosphere saw the home sell after an entertaining forty minute battle.

27 Ryeburne Avenue, Hawthorn East

Auctioneer: Jeremy Desmier
Crowd: 44
Opening Bid: $4,900,000 VB
Passed in: $4,920,000

Sold After: $ undisc
Bidderman: 1

The yells of ‘Play on!’ and ‘Kick it’ could be heard at the footy close by. And eventually a shout of ‘$4,920,000!’ at the auction put it on the scoreboard. Passed in for negotiation – sold after.

21 Iris Road, Glen Iris

Auctioneer: Andrew Hayne

Crowd: 30

Opening Bid: $2,600,000 VB

Passed in: $2,775,000

Sold After: $2,800,000

Bidderman: 2

32 Sackville Street, Kew

Auctioneer: Scott Patterson
Crowd: 35
Opening Bid: $3,600,000 VB
Passed in: $3,670,000

Sold After: $ undisc
Bidderman: 1
A reserved crowd braved the hail and chill factor. One bidder surfaced and was ushered indoors to negotiate after the resulting pass in.

2 Cowper Street, Brighton

Auctioneer: Stephen Smith

Crowd: 40

Opening Bid: $2,700,000 VB

On the Market: $3,270,000

Under the Hammer: $3,290,000

Bidderman: 3

The crowd of about 40 people includes three bidders, so when the auctioneer opens with a vendor bid of $2,700,000, there’s enough participation to create a contest and the final selling price of $3,290,000 is held by a smiling young couple ecstatic to be inking a deal and hustling into the warmth of the home to sign the contract.

 

14 Alicia Street, Hampton

Auctioneer: Stephen Tickell

Crowd: 50

Opening Bid: $2,700,000 VB

On the Market: $2,950,000

Under the Hammer: $2,970,000

Bidderman: 2

A vendor bid of $2,700,000 is placed and there are two bidders, who take the home to the final selling price of $2,970,000 while the extended family of the original owners all gather with neighbours to reminisce on the passing of an era.

 

16 Lansdowne Street, Hampton

Auctioneer: Peter Hickey

Crowd: 30

Opening Bid: $2,800,000

Sold after: $3,000,000

Bidderman: 1

Thirty people gather but when the auctioneer calls for bids, only one bidder steps from the shadows, opening with his bid of $2,800,000. Despite the auctioneer encouraging competition by adding a vendor bid, the same bidder is the only one to place another bid, concluding the auction, and passing the home – Sold soon after

 

17 South Road, Brighton

Auctioneer: Nick Johnstone

Crowd: 40

Opening Bid: $3,700,000 VB

Passed in: $3,750,000

Bidderman: 1

 

2 Campbell Street, Brighton

Auctioneer: Nick Johnstone

Crowd: 32

Opening Bid: $2,800,000 VB

Passed in: $2,800,000 VB

Bidderman: 0

 

6 Mock Street, Sandringham

Auctioneer: Stephen Tickell

Crowd: 25

Opening Bid: $2,300,000 VB

Passed in: $2,350,000

Bidderman: 1

A vendor bid of $2,300,000 was placed and Bidder 1 offered an increase of $50,000 but unfortunately there is no competition today and the home is passed in.

 

60 Roslyn Street, Brighton

Auctioneer: Halli Moore

Crowd: 40

Opening Bid: $3,000,000 VB

Passed in: $3,000,000 VB

Bidderman: 0

 

312 Danks Street, Middle Park

Auctioneer: Oliver Bruce

Crowd: 38

Opening Bid: $7,000,000 VB

On the Market: $7,550,000

Under the Hammer: $7,900,000

Bidderman: 3

Despite the slow start, we were soon away at a gallop with three bidders quickly trading the lead. Bidder two held on firmly to the end taking hold of the keys with a final bid of $7,900,000.  

 

339 Richardson Street, Middle Park

Auctioneer: Simon Gowling

Crowd: 30

Opening Bid: $4,000,000

On the Market: $4,170,000

Under the Hammer: $4,200,000

Bidderman: 3

Auctioneer Simon Gowling introduced the property that is 339 Richardson Street, and before he could get his last words out, bidder 1 jumped in at $4,000,000. Two other bidders joined in, reaching the reserve of $4,170,000 and before you knew it the property was knocked down to the highest bidder for $4,200,000.

 

6 Camden Street, Balaclava

Auctioneer: Josh Stirling

Crowd: 10

Opening Bid: $1,950,000 VB

Passed in: $1,950,000 VB

Bidderman: 0

 

36 Ruskin Street, Elwood

Auctioneer: Josh Stirling

Crowd: 20

Opening Bid: $ 2,750,000 VB

Passed in: $2,750,000 VB

Bidderman: 0

 

84 Marine Parade, Elwood

Auctioneer: James Meldrum

Crowd: 10

Opening Bid: $ $2,900,000 vendor bid 

Vendor bid $3,000,000

Bidderman: 0

22 Hilda Street, Malvern East

Auctioneer: Andrew Hayne

Crowd: 60

Opening Bid: $2,800,000

On the Market: $3,400,000

Under the Hammer: $3,450,000

Bidderman: 3

A quick auction is a good auction. A vendor bid kicked things off before Bidder 1 and 2 made their presence known. $50,000 rise followed by a $200,000 rise, before another $100,000 rise. With Bidder 2 out, Bidder 3 had a go, but Bidder 1 was quick back and the home sold

 

36 Mercer Road, Armadale 

Auctioneer: Kevin O’Brien 

Crowd: 30 

Opening bid $4,500,000 then VB straight away $5,000,000

Sold after: Undisclosed.

Bidderman: 2 

Kevin O’Brien was quick to stamp out an opening bid of $4,500,000, by placing a vendor bid of $5,000,000 shortly after. Heading inside to speak with the vendor twice, it passed in on a vendor bid of $5,100,000 and later sold for an undisclosed price.

 

62 & 62a Victoria Street, Prahran 

Auctioneer: Tom McCarthy 

Crowd: 12 

Opening Bid: $2,000,000 VB

Passed in: $2,000,000 VB

Bidderman: 0

312 Danks Street, Middle Park

Auctioneer: Oliver Bruce

Crowd: 38

Opening Bid: $7,000,000 VB

On the Market: $7,550,000

Under the Hammer: $7,900,000

Bidderman: 3

I got a little confused this week, I thought the Anzac, the Aussie spirit was, we try to never leave any Aussie behind.

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