oc | Sunday 8th December

The Auction Pre-Season has Started!

It's 'pre-season' and bidders and spectators are out in force: Rob Elsom (Hocking Stuart), at 25 Lanark Street, Brunswick East, under hammer, $1,285,000, 4 bidders and a crowd of 66

At 6.00pm on Saturday the James Clearance Rate for Melbourne’s $M+ was 73% on the 26 auctions we covered. The , our bidders per auction measurement, was at 2.8.

It’s good to be back and around the auction scene again. The highlight this weekend was that half  the auctions we covered had three or more bidders. There were seven bidders at 39 Lees St, McKinnon (Anton Zhouk, Hocking Stuart, under hammer, $1,410,000) while three others had 6 bidders (see Bidderbuzz below)

  • Ducks (no bidder auctions) – 8%
  • Lone Rangers (1 bidder auctions) – 21%
  • Norms (2-3 bidder auctions) – 38%
  • Volcanoes (4+ bidder auctions) –33%

It’s a win to the Norms, followed by the Volcanoes!

At this stage we are not placing too much credence on our auction analysis. There were only a few auctions on this weekend, understandable given that sellers would have had to have a shorter than normal, three week campaign, to avoid the Australia Day Weekend shutdown.

In footy parlance, this weekend is a bit like the pre-season competition.

But things are charging back into the big time next week, with February 22 and the following week March 1 both looking like being SUPER SATURDAYS (check out our forward auction graphs on your right of screen) and there are some really interesting homes on offer across Melbourne in that $1.5m to $3m+ price range!

On a personal note it was certainly good to be back and out there bidding this weekend. I love being back full-time on the tools, knee deep in the puddles of emotion dotted across Melbourne on a Saturday –  the smell of fear, the looks of anticipation, the cringes of excitement and the hush of all rolled into an incredible 15 minute sensory overload. Those of you out on the streets this weekend might have noticed our new hats to match the jackets. Thanks for your consistently humorous feedback – we think we have heard them all by now and the hats are here to stay. Please feel free to come up and say g’day or ask us a question if you want to.

Big crowds at the first real auction day of the year: Arch Staver (Nelson Alexander), at 64 Rae Street, Fitzroy North, passed in $1,260,000, 2 bidders and 74 spectators

If you’ve had your ear to the ground you might have noticed that there is a lot more happening in Melbourne $1 million property than Auctions right now.

EXPRESSIONS ON INTEREST

This is a form of buying/selling that is increasingly taking place in the Market.

Expressions of Interest might seem straightforward. You put in your price and a deal is done. But you need to understand the unwritten rules – because in a way what they are a game of poker, of bluff and counter bluff, of manoeuvring, of patience and of risk – with high stakes, indeed very high stakes for all involved, and few or no rules.

HIGH STAKES POKER AT ROWLAND STREET

Have you seen the home at 22 Rowland St, Kew (Scott Patterson & Ross Savas, Kay & Burton)?

I’m calling it The Biosphere and I mean that as the highest of compliments – go inside and you are totally immersed into the space, light and moods created by the owner and the architect Nick Boschler. (For more info about the actual property, read our full rating on 22 Rowland St Kew at http://www.james.net.au/rating/22-Rowland-Street-KEW )

But this article is not all about the home at 22 Rowland, it is also about the High Stakes Poker Game you will need to play to be the buyer. This is a genuine Expression of Interest – there is no bulltish quote and no bulltish rules from – it’s put in what you think and then they will talk.

So, what price in the first instance do you offer, what terms and through which agent at Kay and Burton? There were four agents on the job when I visited and it was mid-week.

How do you make that offer – verbal, in writing or on a contract? Do you have a deadline, is it conditional and is your offer negotiable or firm? Pretty straightforward so far, with only about 20 different combinations.

But wait there is more – what happens when they say no, or more to the point what if they don’t say no but they don’t say yes either? What is your next move and the one after that? And what about the questions – the 10 or 20 any good selling agent will ask you under these circumstances? How do you answer them – openly or guardedly or should you just not answer them at all?

Once you put in your actual expression of interest, that is when things will get interesting. Even if you put in your best price, the agent will probably think it wasn’t and even if he or she does believe you, his or her vendor probably won’t. And so the dance starts – backwards and forwards, upwards and downwards – though probably more upwards or sideways than otherwise.

The thing to remember is that Expressions of Interest are long distance runs not sprints.  So after a week or so – unless you are High and Mighty Charlie with a limitless chequebook – the agent is likely to tell you that you have a new friend, no not him, its another buyer. And so a new dance begins, only this time it’s more of a group conga than the previous intimate waltz. Well, that’s what you are made or may think.

So back to 22 Rowland – this really is the right type of campaign for the seller, as the buyer is going to be a special one. Of course the seller also knows he or she is involved in the same game and there are some risks for a seller in an EOI process – where the rules can be vague and the way forward a little unclear. Sometimes buyers drop out or just don’t start the engagement process as their fear of uncertainty is greater than their love of the home.

How much is this ethereal creation at 22 Rowland worth? Is it $3 million or is it $9 million?

That is the question. So what is the answer?

We can’t tell you specifically at this stage, but the way we would go about finding that out involves relationships and truths, as well as a number of judgments and non judgements.

We’re not trying to be a smart alecs here. What we are trying to say is the answer to securing 22 Rowland lies in the process more than a specific number.

OFF-MARKETS

Another trend taking place is the “Off-market”. Last week we touched on Off -markets, which is where properties are bought and sold without any For Sale board, advertising or internet marketing. This week the mysterious Off-market widened and continued – especially at the very high end. As a group we have been looking and dealing in homes in , Port Phillip, and Booroondara that to the casual passerby show nothing to indicate a transaction may be happening.

Note to Sellers: If you have a family home for sale, you know your price and will allow access to our buyers and can get contracts if requested, then we can in many cases bring a very real, but private buyer to your door.

We recommend you get a selling agent to represent you, but that is your call whether you do or you don’t – in the first instance please ring either our /Malvern office on 98043133 or in Bayside  95968822. Please be assured that any conversations with us, whether you continue or not, are confidential and private.

Seven bidders: Anton Zhouk (Hocking Stuart), at 39 Lees Street, McKinnon, under hammer, $1,410,000

Saturday’s Bidderbuzz:

  • McKinnon, 39 Lees Street, Anton Zhouk (Hocking Stuart), $1,410,000, under hammer, 7 bidders
    Before I had even arrived at the auction in Lees Street, McKinnon, I could feel something was brewing – I arrived 15 minutes early and still couldn’t get a park…(See More in Auction Reports)
  • Malvern East, 50 Clarence Street, Damien Davis (Jellis Craig Bennison Mackinnon), under hammer, $1,520,000, 5 bidders
    A massive crowd of around 140 people spilled down Clarence Street eager to see what would happen at the auction of number 50…(See More in Auction Reports)
  • Malvern East, 306 Wattletree Road, John Bongiorno (Marshall White), under hammer, $1,320,000, 6 bidders
    On a  somewhat humid afternoon with a grey sky overhead, a small group of 30  gathers to watch auctioneer John Bongiorno give a practiced preamble…(See More in Auction Reports)
  • Glen Iris, 8 Mons Street, Hamish Tostevin (Marshall White), under hammer, $1,600,000, 6 bidders
    The day was starting to heat up and so, it appears, was the market as auctioneer Hamish Tostevin’s preamble stirred up the bidders in the 100
  • Toorak, 14 Balmerino Avenue, Marcus Chiminello (Marshall White), under hammer, $1,915,000, 5 bidders
    Nearly 80 people were on hand to watch the master Marcus Chiminello auction 14 Belmerino Avenue…(See More in Auction Reports)
  • Glen Iris, 50 Brandon Street, Damien Davis (Jellis Craig Bennison Mackinnon), under hammer, $1,360,000, 4 bidders
    What a hot auction! As soon as Mr Davis handed it over to the crowd, they were off! $980,000 as the opening bid from Bidder 1…(See More in Auction Reports)
  • Brunswick East, 25 Lanark Street, Rob Elsom (Hocking Stuart), under hammer, $1,285,000, 4 bidders
    Punters huddled under the pockets of shade along Lamark street this morning after a exploring the two story, dual dwelling, renovated Edwardian…(See More in Auction Reports)

Agent Survey: What do you predict the James $M+ Clearance Rate to be  on “Super Saturday” next weekend?

Andrew McCann, Jellis Craig Bennison Mackinnon (Armadale) : “We expect the clearance rates to be strong for the first significant auction weekend for 2014. Open inspection numbers have been strong across all price segments and the market certainly feels like it will open where it left off in 2013 with, at this stage, what looks to be more of a limited supply. By way of prediction I would think an overall Melbourne clearance rate of in the vicinity of 70% will be achieved with an 80% clearance rate likely across the Inner Melbourne and Bayside suburbs, who will traditionally be carrying a better calibre of home”

Bill Stavrakis, Biggin & Scott (Elsternwick): “Gauging the current interest levels and sentiment out in the market, I would have thought it should be in the vicinity of 70%. There have been lots of buyers at our inspections, strong email enquiry and good attendances at auctions which lead me to believe that things will be better than average for the first part of the year.”

Richard Winneke, Jellis Craig (Hawthorn): “The first real test will be 15th February, soon followed by 22nd February & March 1st. Numbers at open for inspection in all price ranges have been solid and we are expecting strong clearance rates. My prediction is 75%”

Campbell Cooney, Hodges (Brighton): “The early indication in 2014 is that the market (prices) have picked up from where they left off in December 2013.  Sales (both private sales and sales before their scheduled February auction dates have been at good prices with multiple buyers interested. We expect the auction clearance rate to be “falsely” less than it should be because many of the sought after properties listed for this date (22nd February) have already been snapped up. This may mean that the less preferred ‘stock’ is still to be auctioned. I predict the clearance rate will be in the high 60%s, otherwise (when including the bought befores) it would be in the low 70%s.”

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