oc | Thursday 20th February

The market is on low stock alert. We need more.

Is this auctioneer the best going around? Top 5 for sure: Mark Earle of Buxton elicits bids from 5 bidders on route to a bought result of $1,220,000: 24 Susan Sandringham: (See our video auction)

Is this auctioneer the best going around? Top 5 for sure: Mark Earle of Buxton elicits bids from 5 bidders en route to a bought result of $1,220,000: 24 Susan Sandringham. See our video auction. (Photo: Julia Atkinson)

At 6pm on Saturday the James Million-Dollar-Plus clearance rate was an almost hard to believe 88% for the 33 auctions we attended.

Bidderman, our Indicator, was steady at 1.8 bidders per auction. This is a level we would call solid.

Market Supply was 77 monitored $M+ Auctions (100 is a strong weekend).

Market Price seems to be firming on the back of lower stock levels – October’s rush is the next big test.

demand1supply1price1 Click on to see graph in full size.

Market: The market this week is all about nothing- nothing to buy and not much coming on. While most agents are reporting reasonably full auction books for the third week in October, things seem pretty lean before and after that. So supply is tightening. As for demand, there is no question that it is back. Not that it really left us, it’s just that autumn had way too much stock on offer for the market to absorb. But right now – well, look at the 1) James $M+ clearance rates, 2) Bidderman, 3) some big sales on the $3m+ market, 4) a number of ‘stales’ finally selling after a long time on market, and finally 5) a few off markets as well – all evidence of good demand. Demand seems stronger at the top, which has been a big turnaround in basically six weeks.

Price is strengthening. Sure some of this week’s mega sales were stales and the vendors had to drop their asking prices. But when they collignwooddid, the market was there (whereas it was not a few weeks ago). Well-priced homes coming onto the market are seeing stronger competition and prices are being pushed up.

If buyers take up the offerings of late October with some gusto, the market will need a supply injection to prevent further price increases (assuming demand stays as is). Another sign of a strengthening market is the level of  pass-ins and the “bought immediately afterwards”. This weekend there were a number of “bought immediately afterwards”, some with hefty price premiums. In these situations buyers could walk if they so chose, but despite the big “reserves” fewer buyers are choosing to do so – thus strengthening prices.

But let’s not get ahead of ourselves – all we are saying is that the agents who are telling you the market is weak are not in the same market we are operating in. If things change (and they may do so next month)  we’ll let you know.

Highlights: (see more in the $3M+ market report – we provide analysis on over 40 $3m+ sales – it’s below Buyer Masterclass)

This weekend:

  • Armadale 28 Seymour: Joanna Nairn: Bought After Auction: Around $3,500,000: Bidderman 1
  • South Yarra 38 Park: Warwick Anderson: Bought After Auction: Above $3,000,000: Bidderman 1
  • Balwyn 23 Bevan: Richard James & William Chen: Bought After Auction: Around $3,500,000: Bidderman 1

Two $9 million homes bought last Monday:

  • Hawthorn 24 Coppin: Jock Langley: Around $9,000,000 Private Sale. This basic house, on an acre on the river in Hawthorn’s river precinct, has been on the market for well over a year and had quotes at $15m then $12m and then…. A number of agents have worked on this. I went through this home last year and finally Jock Langley has got a sale through under $10m. It is a great block, and its only fault was its price tag.
  • Brighton 292 New: Brian Devlin and Regina Schmidt: Around $9,000,000 Private Sale. Up for sale for less than a month, this grand looking home was purchased for around $9,000,000. A very impressive block just down from Brighton Grammar.

Two $6 million homes, both of which had been on the market longer than a year, were finally bought during the past week

  • Toorak 8 Macquarie: Jeremy Fox: Private Sale after an auction. $6,400,000.
  • Brighton Moule Ave: Golden Mile: Stewart Lopez:  Bought, reportedly in the high $6 millions, Off Market

Off Market Apartment Action: Marcus Chiminello

  • East Melbourne Jolimont Road: Penthouse $3,250,000
  • Melbourne St Kilda Road: Lucient $3,100,000
  • Malvern Elizabeth: Off the plan $3,300,000

Lowlights:

  • None unless you are a Cats supporter

Around the Grounds: (see our market wraps for all boughts as well as the latest local $M+ news)

  • Bayside: Continuing to improve, with clearance rates trending upwards (a strong 80% on 20 auctions).
  • Boroondara: Solid, although Stonnington and Bayside are now level pegging, clearance rate wise. (78% on 36 auctions)
  • Stonnington: Continues to improve on low stock levels. Maybe the improved conditions will entice some juicy stock out on to the market, because for now the cupboard is a little bare. (75% on 16 auctions)
  • Port Phillip: Ten $1m+ properties were bought this week, although none above $2 million. Still very little stock on offer. (60% on only 5 auctions)

Agents Q&A: Stock Levels

Steve Tickell, Hocking Stuart, Sandringham: “Stock is slowly building. There seem to be a lot more inquiries from people and I would say it has been more positive in the past week – more like 2007 than 2009. In Bayside, villa units and good family homes continue to attract a lot of interest.”

John Bradbury, Noel Jones, Balwyn: “There is not as much stock as there was at this time last year, but there is enough stock there. I think the election put a real bump in the road, which a lot of people didn’t expect.”

Step Back Sir and put up your hands says Secret Agent Auctioneer Michael Nolan of Noel Jones. Mission Accomplished - Bought After $1,150,000: Another triumph for good over evil: 11 Scheele Surrey Hills:

Step Back Sir and put up your hands up says Secret Agent Auctioneer Michael Nolan of Noel Jones. Mission Accomplished - Bought After $1,150,000: 11 Scheele Surrey Hills:

David Hart, Buxton, Brighton: “Stock levels are as low as I have ever seen. I think it is because we have had a long winter and also because of the election. I think, unfortunately, stock levels are about 40% lower than the same time last year. We are going to have a very late Spring, say late October/November.”

Doug McLauchlan, Marshall White, Hawthorn: “ Stock is extremely low at the moment and the concern is that potential stock offered to them in October will not come onto the market until much later in the year. These low stock levels could be in part due to the exceptionally high stock levels on the market in the early part of the year. Added to this, an election that took 7 to 8 weeks to resolve wasn’t helpful. Uncertainty seems to be an issue.”

Paul Keane, , Glen Iris: “Stock levels seem to be increasing although slowly. We would expect normal market conditions will start to improve in the latter part of Spring.”

Marcus Chiminello Marshall White Armadale: “Indicators of new stock coming on are very low compared to previous years. If we are going to have any spring at all it will be late.”

BidderBuzz Auction of the Day: 10 Hillard St, Malvern East, John Morrisby /Dean Gilbert, Bought undisclosed for more than $1,640,000, 6 bidders.
A slow auction to start with, but things really picked up when the property was declared on the market at $1,640,000. Auctioneer John Morrisby led the charge, with a massive six bidders battling it out until the end. The property was bought under the hammer for an undisclosed amount. Reasonable sized crowd of 65 and a strong vibe.

Issue: Bayside and Stonnington’s $M+ clearance rate improvement since the election, which just shows you what falling stock levels do to the market.

stonningbay

Market News TV: This week we have Andrew McCann (BenMac) responding to fellow agent criticism of BenMac’s “Reserve within the Quote” policy. Check out our Agent Opinion Videos.

Video Auctions: Two great video auctions this week. We have Architect Adam at 23 Bevan St, Balwyn and Klarity Kris at 24 Susan St, Sandringham.

Buyer Masterclass: Preparation tips for good negotiation – Like a Good Boy Scout, Always Be Prepared”

No Market News next week owing to the Grand Final and next to zero quality auctions.

STOP PRESS: Tuesday 21st September: Scott Patterson of Jellis Craig Hawthorn: “Our stock levels for October are now quite strong.  As of today we have booked 137 auctions which is 11 more than last year.  Of the 137 there are 66 that are likely to sell for more than $1m.” Bill Jowett of Buxton Sandringham: “Stock levels are now looking stronger for last two weeks in October”
Editor Note: There seems to have been a surge in listings last week as other selling agents are also a bit more upbeat today, seemingly after collating last week’s listing results. This could be good news for buyers on two fronts; choice and price and may put a different slant on Saturday’s reports below. We have added this note as we are not reporting this coming week and thought this relevant buyer information.

We Only Buy Homes

South Melbourne 81 Tope: No thanks said the crowd: No bidders and passed in for $1,150,000

South Melbourne 81 Tope: No thanks, said the crowd: No bidders and passed in for $1,150,000. (Photo: Linda Slater)

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