oc | Thursday 23rd January

So how did the market start?

A $5,000,000 volcano - 4 bidders. Wow! 120 Powlett St, East Melbourne, Arch Staver (Nelson Alexander), under hammer, $5,145,000

At 6.00 pm the James Clearance Rate was 66% and , our bidders per auction measurement, was 2.2.

Well, here we are knee-deep in the thick of it. This was a borderline Super Saturday, as is early next week, meaning we have around 150 scheduled Million Dollar plus auctions in Inner East and Bayside.

We say borderline because so much of what is on offer is borderline $1m. It’s certainly not the at the Top End, in fact much of what was on offer was pretty basic.

Nonetheless it is what it is and this weekend we have tried to capture the early market flavour by covering and reporting on a whopping 38 auctions.

So enough of the puff and bluster. What is really happening out there in Inner Melbourne?

This Weekend’s Market Flavour

  • There were more ‘volcanoes’ than ‘ducks’, meaning more auctions we attended had 4 bidders than no bidders.
  • The numbers for Bayside are the best we’ve seen on that market for a few years. There was lots of stock on offer (54 Auctions) and more than  7 in 10 sold on the day – that is very strong for Bayside.
  • But all James Buyer Advocates reported strong interest in their areas.
  • As a group we have just completed our strongest February on record and many agents, if they are are being truthful, will be reporting similar starts.

What this means is that we have the ingredients for some good markets post Easter, as vendors who have been standing on the sidelines see a very positive start.

The very solid numbers this weekend also mean that buyers and sellers are coming together in big numbers – i.e. there is a lot of agreement on price (well done to agents).

Of course these clearance rate numbers will go south in a hurry if two things happen

  1. Vendors en masse start to chase a price rather than a result
  2. Big numbers of new stock hit the market post Easter without matching .

All things said, if things go well next weekend, which is another big week, making it two back to back Super Saturdays, then we can say with more confidence that the market is out of the blocks in 2013 with a fast start.

February 23rd 2013 – Thunderbirds Are Go!

  • Ducks (no bidder auctions) – 18%
  • Lone Rangers (one bidder auctions) – 26%
  • Norms (2 or 3 bidder auctions) – 26%
  • Volcanoes ( 4 or more bidder auctions) – 21%
  • 3 of the 38 auctions we covered were bought before.

Auctioneers will do anything for a dollar. Nick Johnstone (Nick Johnstone Real Estate) said he'd jump in the pool if he received $10,000 more. He got it so he did. 50 Comer St, East, under hammer, $2,715,000, 5 bidders

Bidderbuzz:

  • , 5A Macfarlan St, Mark Wridgway (RT Edgar), under hammer, $1,360,000, 7 bidders
    A crowd of some 50 onlookers attempts to find shade from the hot midday sun, and waits impatiently for the action to begin. Auctioneer Mark Wridgway does a superb job…(See More in Auction Reports)
  • Kew, 8 View Point, Scott Patterson (Kay & Burton), under hammer, $2,001,000, 6 bidders
    Interesting auction this one, that took around 50 minutes. In front of around 80 people in the shade of the two-storey, rendered home, Scott Patterson was auctioneer here and did a great job…(See More in Auction Reports)
  • Kew, 3 Swinton Ave, Scott Patterson (Kay & Burton), under hammer, $2,195,500, 5 bidders
    An opening bid of $1,500,000 was stepped up by a couple of vendor bids, and at $1,650,000 a half-time break was…(See More in Auction Reports)

Boroondara with Architect Adam – Clearance Rate was 76%  on 61 Auctions. – Strong
After a reasonable start, on February 16, how will the market respond to larger auction numbers? February 23 represented our first Super Saturday of 2013, with 147 auctions for properties over $1,000,000. The results were strong today for Boroondara in the $1m plus market. Bidderman remained firm at 2.2 and the hammer rate a very healthy 50%. (More Architect Adam’s Boroondara Wrap)

Stonnington with Call Gina – Clearance Rate was 78% on 25 Auctions.  – Strong
Of the 32 $1 million-plus auctions, 78% sold. With everyone awaiting the wash-up from this weekend and the results from next week to show the way forward, it is worth noting that some good quality, well-located properties are becoming available prior to the end of March. (More in Call Gina’s Stonnington Wrap)

Bayside with Klarity Kris – Clearance Rate was 79% on 31 Auctions.  – Strong
The focus this week seems to be on whether the current interest through open houses would convert into home purchases. Agents, vendors and buyers alike have all been eager to see the results. Talking to selling agents during the week revealed quite a bit of anticipation. (More Klarity Kris’s Bayside Wrap)

Port Phillip with Vino Guy– Clearance Rate was 67% on 23 Auctions. –  Solid
With 64 Armstrong Street Middle Park selling for over $4 million at auction last year, (Michael Szulc of Geoff Cayzer), and an off-market with Michael Coen (Hocking Stuart Albert Park) going for over $6 million, some bigger properties that have been in hibernation for the last two years are finally starting to surface. In the past two weeks, I have been offered four private off-market properties in Port Phillip, the prices ranging between $3.5 – $6 million. (More in Vino Guy’s Port Phillip Wrap)


East Melbourne, 120 Powlett, Arch Staver, Under the Hammer, $5,155,000 – 4 bidders

There was a festive air along Powlett Street this morning as real estate punters strolled in and out of historic homes open for inspection in this proud and peaceful pocket of Melbourne. With a crowd of 150 gathering under magnificent trees on the wide, green median strip, Arch Staver needed only a few words to emphasise the piece of Melbourne history on offer.

But despite the crowd, Mr Staver was left to open the day with a vendor bid of $3,950,000.  After Bidder 1 was welcomed in at $4,000,000, Bidder 2 followed closely with $4,050,000. After a short tussle between them, Bidder 3 entered the scene with a bid of $4,125,000, triangulating the vast crowd.

In increments ranging between $50,000 to $10,000, and then to $5000, it seemed bidders 1 and 3 would battle till the end. When the pace slowed at $4,325,000 Mr Staver took a short conference with the vendor before kicking things off again at $4,400,000. Bidders 1 and 3 took off once again, only to be confronted with Bidder 4 at $4,710,000.

Standing practically shoulder-to-shoulder, bidders 3 and 4 jumped ahead from $4,710,000 to $4,850,000. After slowing down to catch their breath, they were off again heading to $5,000,000.

Turning to Bidder 1 to confirm that there was no more competition from the other side of the crowd, and raising a few laughs, Mr Staver steered the final bidding, eventually coming to rest with Bidder 4 at $5,155,000.

There was jubilation and commiseration offered to the two crowd champions before Mr Staver thanked the crowd for the lively competition and directed the successful bidder into his new home. (Josie Wagstaff)

Check out the auction reports on the rest

  • Balwyn– 19-21 Maleela, James Tostevin, Auction just under $4,000,000
  • Albert Park, 35 St Vincents Place, John Bongiorno, After Auction above $3,300,000 – 4 bidders
  • Brighton, 20 Grosvenor St, John Bongiorno, After Auction above $3,000,000 – 0 bidders

Pass-Ins at

75 Well St Brighton – $2,800,000 and 4 Higham Road Hawthorn East – $3,125,000 and, surprisingly, 30 Chesterfield, Malvern at $3,000,000 – good home.

Apartments
The sale of 301/87-89 Dundas Place, Albert Park selling under the hammer with 4 bidders for $2,675,000 (Alex Schiavo and Tim Blackett) is perhaps a pointer to a slightly better market for these high end buildings. There is no doubt an apartment still has to have something special about it, but when it does – a la Dundas (James Home Rating of 676) – we are seeing an increasing interest from downsizing couples willing to take the plunge. More of these buyers seem to be accepting the risk of an off the plan or newly built, and are comfortable understanding that the emotional outcomes are often better than the financial outcomes with Top End apartments.


Agent Survey: How do you think Super Saturday will go? (please note that we asked the agents during the big event)

Peter Kennett, (Brighton): “I think if the vendors have listened to their agent’s advice throughout the campaign and they have presented their property to the broadest market possible (i.e. not cut corners on marketing) then they should expect to sell. If the strong numbers of buyers that have inspected our properties over the past 4 weeks are an indication of market sentiment, then I would predict 80% plus clearance rate in the Bayside and mid 70% throughout Melbourne.”

Bill Stavrakis, Biggin & Scott (Elsternwick): “The expectations are great!”

Michael Armstrong, Kay & Burton (South Yarra): “I think Super Saturday (and the EOI campaigns that fall around it) will continue on trend so far this year with in the high 60%/early 70% range and competition (and in some instances fierce competition) for good quality homes. We see stock levels staying steady until the end of March and buyer confidence continuing to improve. The combination of low interest rates, improving global economic conditions, and strength in the equities markets will continue to drive demand at the prestige end. It’s an old adage that it’s difficult to buy great family homes in any market, but right now when there is relatively low , improving confidence and affordability is at the best levels it has been for quite some time, it may become even more difficult and in turn put upwards pressure on prices.”

Craig Shearn, (Clifton Hill): “With the first serious offering of auctions to go under the hammer this weekend, we should see a solid clearance rate if numbers through open houses in February are anything to go on. A 65% + clearance rate for Melbourne would certainly show some solidity and depth in the market coming off the improvement in the December quarter last year. However, I feel the actual clearance rate will come in at around 70%.”

Torsten Kasper, Chisholm & Gamon (): “2013 has started with a distinct change to 2012; across our three offices along inner bayside, we are feeling a sense of renewed optimism. This is being motivated by some primary drivers, the stock market is up and about and those that have had a diminished asset base for several years are taking their gains and entering the property market. The environment looks stable and buyers are feeling confident in the medium term outlook and finally you can only sit on the fence for so long. The renewed buyer depth has had an immediate impact on clearance rates and, in my opinion, will have a positive effect on pricing. If you are looking to buy it is our opinion that you should get in now. We are about to see some mild growth and strong competition for good homes.”

 

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