oc | Wednesday 26th February

Bidderman up. Clearance Rates steady. Bayside Battling.

10592-59StudleyRoadIVANHOE-1

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

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

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

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

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

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

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

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

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

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

43auctions

Highlights

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

Some strong results in other $M suburbs.

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

Lowlights

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

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

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

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

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

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

Issue: The 3M+ Market

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

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

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

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

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

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

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

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

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

We Only Buy Homes

35 Hosken Street, BALWYN NORTH

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

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