oc | Friday 24th January

All Market Indicator Dials are red hot!

Armadale: 27 Huntingtower Road, Kevin O'Brien and Dawn Meyer (Jellis Craig), under hammer, $3,150,000, 2 bidders

At 6.00 pm on Saturday, the James Clearance Rate for Melbourne’s $M+ was 82% on the 38 auctions we covered. The , our bidders per auction measurement was at 2.3. Today was a Super Saturday – meaning these numbers have not been created by stock shortages. In fact there is a double Super Saturday next week. As well there was an excellent spread of bidders across all good quality homes, as evidenced by a win to the Norms below.

Market Summary

1) Endless mainstream media talk about the market possibly faltering, but there is NO evidence of the Inner Melbourne housing market faltering.

2) There is talk of price leveling, but there is evidence to the contrary of price increases happening on popular market segment homes.

27 Huntingtower Road, Armadale is an example of what we are talking about in the market right now. Single-level, well-located downsizers home

  • Auction 2009: $2,500,000
  • Auction 2014: $3,150,000

Auction Report: “Auctioneer Kevin O’Brien and Dawn Meyer knew they had a good one here: A-grade locale, quality build, the ‘perfect downsizer’ abode. The preamble came easy and so did an opening bid when ‘$2.3’ was called clearly and firmly. Competition soon emerged, and though this was to be a two-horse race from beginning to end, both battled strongly. At $2,550,000, rises of $25,000 were still requested. ‘I’ll give you ‘10’,  stated Bidder 1, ‘No, 25’ … ‘I’ll give you 10’  … ‘No, 25’ – auctioneer and bidder both stubborn in their resolve. How about a vendor referral? Good idea. But nope, it’s still not on the market. Click here for full auction report. For the James Home Rating on 27 Huntingtower Road, Armadale (James Home Rating 732/1000) CLICK HERE

3) Next week’s SUPER, SUPER Saturday (double a normal Super Saturday and quadruple a normal auction weekend) will tell us if there is any easing in the two-year Bull Run market.

With 8 - yes 8 - bidders and a sale price well above reserve, you'd be smiling too: Peter Kakos (Marshall White) at 3 Thule Court, Brighton. Under hammer, $1,815,000

The Exhausted & Desperate Buyer

I am looking
I am looking
I am looking
But we can’t find.

I am bidding
I am bidding
I am bidding
But we can’t buy.

I am hurting.
She is hurting.
He is hurting,
But we can’t heal.

If you are a buyer perhaps re-think your position.

The Inner Melbourne $m+ market is at it’s strongest levels in terms or bidders, sellers and action in three years. There is no evidence of an end in sight, despite the current mainstream media’s obsession with doom.

Yes, the market may change next week, but it hasn’t yet and your buying strategies need to be in sync with the current market (if you want to buy).

The Block is not real – it’s fairy tales and it’s not a true representation of the Inner Melbourne Housing Market – it’s a true representation of poorly thought out buying and selling procedures in the apartment market.

Below is the real market and we think real buyers know this.

We bought four last week (two off market) and missed a young buyers home last night with Stuart Evans in Hawthorn and bought two from two today in Hanby Street, Brighton (Chris Carrington) at $3.3m and Mountain Grove, Kew (Greg Toogood and Richard Earle) at $2.7m ish today.

1) All bar one had competition.

And we have 12 auctions and negotiations next week (Double Super Saturday).

2) We as James Buyer Advocates are experiencing significant client demand on good homes.

The Market right now is incredibly strong and robust and today supports that again, as it has all year.

3) Long term Bidderman does not lie – if its consistently over 2, then the market is strong and getting stronger – it’s all about buyer depth.

When will it end?

We have no idea, but it hasn’t ended yet.

Are you Auntie Mary?

Auntie Mary is waiting for it all to end. Mary was looking to buy a grand home in 2005 but decided to wait, she was looking for a smaller home in 2007 but decided to wait, she was looking for a townhouse in 2010 but decided to wait and now she is looking for an apartment – but you guessed it, she has decided to wait.

I am missing
I am missing
I am missing
We are missing the point.

I am hoping
I am hoping
I am hoping
We are losing hope.

I am crying
I am crying
I am crying
We are not facing reality.

Here is our good buyer plan till Christmas:

  1. Consider engaging a professional buying team. Set Up I’MGOINGTOBUYWELLFORME Pty. Ltd.
    Break the ‘losing cycle’ and become a buyer … of a good home. Get on board your team, one that really understands property.
    No, not the accountant that always says don’t do it. Yes to an accountant that actually owns property, has his or her own wealth and is successful in business.
    No, not a financial planner that tells you to buy off-the-plan or ready made investments while they are trousering a big commission. Yes to a financial planner that understands and helps build your wealth through home ownership.
    No to a banker who’s name escapes you. Yes to a private banker or broker whom you have a longer term relationship with.
    No to a buyer advocate that can’t show you 50 similar homes they have bought, unless of course you want them to “learn” on your job. Yes to a good buyer advocate. But hold on, what about all those advocate fees – says Auntie Mary. A good advocate can cost 1% – the market is moving more than that each month – bought two months ago and you are in front even after the professional fee. Plus, please do not think that many of your real competitors (other buyers in your price range) are not getting professional help.
  2. Consider a plan that works. Auntie Mary’s plan revolves around a fear of paying too much. Too much last year is 15% below what Auntie may have to pay now.
  3. Understand that you are not just embarrassing yourself when you bid without knowledge at auction, but you are also leaving yourself open to buying poorly. Being back on the market reselling your home in the near future is 7 times more expensive (fees, stamp duty, reselling costs, interest) than the professional fee you may pay to buy well in the first place – and what about the emotional turmoil.
  4. You don’t trust the selling agent Auntie Mary – in fact you know he stretches the truth, yet you use him to bid to buy your dream home because he is ‘free’. Do you think the selling agent from another company, will be helping your selling agent, help you buy well. Are you really thinking this through Auntie Mary?

You have three to four more weekends of good stock before February.

I am thinking
I am thinking
I am really thinking
We are breaking the Auntie Mary chain and getting a professional buying team.

Self interest in above comments – yes, no doubt. Self interest for us and self interest for you. That’s very different from a selling agent – self interest for them and their selling client, no self interest for you the buyer.

Hey Paul, hat off to you, you are looking tanned and trim. 14 Gardiner Parade, Glen Iris, 3 bidders.

Remember the free $million dollars from our Young Homebuyers Guide published in The and The Age? Click here for the free Young Homebuyers Guide.

Young Apartment Buyer who bought in 2000, an apartment in Docklands at 15 Caravel Lane for for $507,500 and resold it for $576,000 in 2014.

Young Inner Melbourne Buyer who spent similar money in 2000 on a family home in Celia Street, Glen Iris for $493,000 and sold again in 2014 for $1,500,000.

How would we negotiate a better deal?

If with some brilliant negotiation we could have got the Docklands apartment for $400,000 would it have been a good negotiation?

This is how we would best negotiate Caravel Lane – we wouldn’t.

This is how we’d best negotiate Celia Street – we’d make sure our client got it.

I am thinking
I am thinking
I am really thinking
We are breaking the Auntie Mary chain and getting a professional buying team.

Auctions on a Saturday, no better place to be: Nick Renna (Hocking Stuart) at 35 McKinnon Road, McKinnon. Under hammer.

Overall Summary of Melbourne’s Million Dollar-Plus Auctions:

  • Ducks ($M+ auctions with no bidders) 9%
  • Lone Rangers ($M+ auctions with one bidder) 15%
  • Norms ($M+ auctions with 2 or 3 bidders) 52%
  • Volcanoes ($M+ auctions with 4 or more bidders at auction) 24%

Bidders were widespread across almost all good properties as evidenced by the Norms.

Biggest Auctions:

  • Elwood, 51-55 Goldsmith Street (Adam Guest, Wilson), under hammer, $5,450,000, 2 bidders
    There are not many development blocks in Elwood, and furthermore there are not many with  permits…(See More in Auction Reports)
  • Hawthorn East, 52 Anderson Road (Richard Earle, Jellis Craig), under hammer, $3,320,000, 3 bidders
    A good auction this one, and the vendor should be really happy with the outcome…(See More in Auction Reports)
  • Middle Park, 61 Armstrong Street (Oliver Bruce, Marshall White), under hammer, $3,300,000, 4 bidders
    Spring is fickle, turning a bright sunny morning into an overcast afternoon, but it fails to deter a crowd of 70 from turning up…(See More in Auction Reports)


  • Brighton, 3 Thule Court (Peter Kakos, Marshall White), under hammer, $1,815,000, 8 bidders
    The auction of this 1930s home was red hot, and I am not referring to the weather…(See More in Auction Reports)
  • McKinnon, 35 McKinnon Road (Nick Renna, Hocking Stuart), under hammer $1,702,000, 5 bidders
    This is “not the Olympics, there is no silver medal” announced auctioneer Nick Renna…(See More in Auction Reports)
  • Sandringham, 12 Trentham Street (Robin Parker, Marshall White), under hammer, $1,551,000, 4 bidders
    What a day for an auction!  I could easily see why Robin Parker prefers the morning slots…(See More in Auction Reports)

Biggest Pass Ins:

  • Toorak, 14 Glen Road, passed in, $3,200,000, 1 bidder
    This single-level home, according to auctioneer Jeremy Fox, would suit…(See More in Auction Reports)
  • Glen Iris, 14 Gardiner Parade, passed in, $2,200,000, 3 bidders
    Only a small crowd at one of the first auctions today, but no shortage of bidders….(See More in Auction Reports)
  • St Kilda, 8 Gurner Street, passed in, $1,950,000, 1 bidder
    Adam Guest is a theatrical and energetic auctioneer, and he sure knows how to set the mood…(See More in Auction Reports)

Agent Survey: How are stock levels since the school holidays? Next weekend, October 25, is Super Saturday. What are your predictions for Clearance Rates and Bidderman numbers?”

Paul Pfeiffer (RT Edgar, Toorak): “Last time I sent in my thoughts, I had bullish expectations of the market post school holidays.  Now we are half way through October, the amount of properties in the market place is still less than I expected and the buyer demand has been a constant since the beginning of the year.  So you would typically expect price growth with the “supply and demand” rationale, but I am not experiencing consistent strong competition on unique properties. Although, I don’t waste my quality family time on shows like Channel 9’s The Block, the response they experienced for their five auctions was an accurate depiction of what I am experiencing in the market place.  Of every five properties you put into the market, as individual as they are to each other, three will perform well and two will not.   It feels like the top end of the market ($5m+) has had stronger competition than the lower priced properties ($1m-$5m). Our office has made some significant sales over the past month, and I am aware that our competitors have also landed some big fish. There is some great value in the market $1-$5m and I expect that with the improving weather, we will see an increased level of buyer enquiry and quicker decisions being made as we approach the end of the school year and Christmas. The 25th October is looking like a MONSTEROUS Saturday, with my prediction being 71% clearance rates and average 2 Bidderman.  With the Spring Carnival around the corner and the last round of auctions being scheduled for 22nd and 29th November, and if you are a risk taker 6th and 13th December are definitely last minute options – the time has come to make the decision to sell in 2014 or from February 2015.  The reverse side of this coin are, of course, the buyers, leaving only a handful of Saturday’s to buy your property.”

Sam Gamon (Chisholm & Gamon, Elwood): “Stock levels are the best we’ve seen them all year and are likely to exceed last year’s Spring. We have a rush of vendors wanting to sell late November and through December. We’re also booking auctions for Feb/March 2015. The calls coming through are predominantly motivated clients with predetermined ideas on timing. Conversations start with “can we book photos next week and have our auction on this date?” We see this as exciting for the local market. For a long time the quality stock has been held back and this has curtailed opportunities because vendors often buy before they sell and we need availability of properties so downsizers and upsizers have choice. Buyers are out in force for quality properties and we’re seeing a decisive audience with a strong appetite. Super Saturday (25th) should be extremely positive for the market. My Bidderman prediction is 2.5 and I would anticipate a state-wide clearance of 78-80%”

Kate Strickland (Marshall White, Brighton): “There has been an increase in available property since school holidays and as the weather has increased and the flowers begin blooming into Spring. Naturally as property stock increases, the number of buyers don’t necessarily increase at the same rate which is where success rates can tightened. I do however believe that the market confidence is excellent, and our team is going on seven weeks of 100% success at auctions in Bayside and the quality of property sold and currently on the market is exceptional. We don’t see the success in selling or confidence decreasing in the coming weeks as the auction weekends come down under 10. I would suggest clearance rates to remain over 70%, however bidding numbers may thin out over the $2 million zone and result in one bidder consistently and an increased pass-in and negotiate strategy.”

Arch Staver (Nelson Alexander, Fitzroy): “We may all be bravado upfront but I think that most prominent agencies  will be holding their breath hoping that the increased supply is taken up. Statistically speaking and on recent trends, I think anything at or above a 68% clearance rate is pass mark for such a high volume weekend. What does however give me confidence of a quick bounce back (in the event of a “deep breath” weekend) is that there is nowhere near the stock levels in the pipeline that we would normally be seeing so advanced in the spring market. We would be hopeful that there are at the very least two bidders on each house with some of the more popular homes experiencing three to four and the less popular one, or dare I say it … none.”

Richard James (Jellis Craig, Balwyn): “Our October Auction bookings are 20% higher than October 2013. November 2013 was our busiest month for that year. It looks like it will not be quite as busy this November given the State Election on the 29th. In saying this, the effective rate per Saturday will be almost exactly the same, ie five Effective Saturdays in 2013 versus four Effective Saturdays in 2014. My prediction for the Clearance rate for the 25th will be Melbourne wide 72.50% , Boroondara 77.50% Bidderman , Melbourne wide 2 , Boroondara  3.”

Peter Kudelka (Kay & Burton, South Yarra): “We have certainly seen an increase in stock levels since the school holidays finished, which also coincided with the end of the football season. This particular period is perfectly slotted between the end of the football and the start of the Spring Carnival to give a clear four week window to market property. This phenomenon also gives rise to the “Super Saturday” on October the 25th as this is the last Saturday before the Spring Carnival commences. Given the increased volume of Auctions on the 25th of October, we may likely see a decrease in “Bidderman” numbers on the day, as buyers may be more spread out across the market place, but any properties that are passed in will more than likely be taken up in the following couple of weeks before the run in to Christmas. It would be fair to  expect a slight correction in clearance rates for this particular weekend, but clearance rates do not take in to account the sales that are concluded within a very short space of time post auction.”


Subscribe to our Market News Newsletter

Tags: , ,

Be with James

Would you like to talk to us about finding or negotiating on your next home?
We buy 100 homes for our clients every year.
We buy Inner East and Bayside over $2m.
View more MasterClass Articles

Inside James Market News