oc | Monday 30th March

In a nutshell the Super Saturday market was a little unconvincing today.

Now thats a wrap. A Super Saturday wrap. John Morrisby clinches the deal on 40 Britten Glen Iris under the hammer for $2,415,000. 3 bidders

Now that’s a wrap. A Super Saturday wrap. John Morrisby clinches the deal on 40 Britten, Glen Iris under the hammer for $2,415,000. 3 bidders.

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It is important to note that we deliberately focused on the high-end today, as it is the canary in the gold mine. The Top End is where you will see the change (if any) first, as this current market is a Top End driven market. The Top End traditionally has the least depth of any price segment, and therefore provides good insights.

33 of the 38 auctions we covered today were over $2 million and almost half of what we covered today were over $3 million. You may think some of the comments below are perhaps fence sitting – we are not – we are reporting as we see it. We saw some change, but we are cognisant that today was a Super Saturday and we concentrated on what is traditionally the lowest bidder number segment – the top of Melbourne’s Top End. The market still had some considerable strength.

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Every year this is the weekend that tests the spring market; so today we sent auction reporters far and wide – up and down, over and under to confirm or deny what is really happening on the auction scene, and therefore what is really happening to $M+ .

In a nutshell the market was unconvincing today. It did not handle the stock gorge as it has been, and as it would have in May of this year.

However overall, we would still say we feel we are in a strong market, just not quite as strong as at May.

1) In this last week you can feel the press talk, Macquarie and Westpac is having an affect at the margins – the B and C graders.

2) Statistically the market, even last weekend, was showing a strong in the mid 2’s and a clearance rate at 80% and all this set against a background of big . Today was borderline 2 and the clearance rate was also borderline. When we say borderline – we mean borderline between a strong and normal market – not borderline between a solid and weak market.

3) Agents we talk to have reported a lessening of OFI interest and buyer urgency when comparing this, the middle-spring market, to the May market just a few months ago. However the agents, whose opinions we respect, still feel this market has some legs, just not the same muscle thickness as the white-hot market pre-winter. We agree.

Do we think the market is as strong this week as it was last week – NO. While Lone Rangers and Norms remained the same, the Volcanoes dropped significantly and the Ducks increased.

Do we think the market is as hot this week as it was in May – NO, but we have recognised and acknowledged that several times since early spring.

Do we think the market is falling – maybe, but our best bet is we think it still rocking along and probably levelling out.

Some historic perspective:

This was a huge weekend and below is the James Super Saturday headlines of the last five years.

2015: In a nutshell the Super Saturday market was unconvincing today: Clearance 74%, Bidderman 2.0

2014: It was bloody tough for buyers today (as expected): Clearance 77%, Bidderman 2.1
Market moved from super speed to supersonic speed in early 2015.

2013: Super, Super Saturday! Clearance 73%, Bidderman 2.3
Market continued to rise.

2012: Did it Suck or did it Sizzle? We think it Sizzled! Clearance 71%, Bidderman 1.8
Market turned in this month and went up in the next six months, in fact has gone up until now.

2011: Super Saturday: Sizzled for Some, Sucked for Many: Clearance 43%, Bidderman 1.3
Market went down in the next six months.

2010: What happened this Super Saturday? Clearance 55%, Bidderman 1.3
Market went down in the next six months. This really was the start of a very average late 2010, 2011 and early 2012 market.

So overall, what was our take on Super Saturday 2015.

1. Market chatter is having some affect on dampening the rate of increase in the market.

2. Although the numbers are down today when compared to the last few weekends, that may simply be due to the sheer size of what was on offer and our skewed coverage towards the absolute Top End. The jury is still out for us on any market turn. But we acknowledge the mood appears to have eased some more in the last week.

3. This weekend’s results when compared to the last three Super Saturdays in this current upwards market (October 2012 to now) is still within the same band; Bidderman and clearance rate wise. The results today are still what we would regard as a strong market. 

4. There is no doubt there are more pass-ins occurring at the higher level. This is not an unusual phenomenon in a changing market, so yes, it maybe changing. It is also not unusual in a stock bulging market, so yes, it may be simply the amount of stock on offer. We are not ruling either in or out, on what we saw today. As a Melbourne market changes it becomes two-paced – the A graders (good PPP’s) continue to shine, the B graders show mixed results and C graders (poor position or price or property) simply don’t sell. This is happening now as some sellers have kept their price targets going up while the buyers targets have begun to level, even drop.

Has the Inner Melbourne market changed?

Maybe. In our opinion in this last week the market has definitely suffered a flesh wound in confidence, however it is too early to tell if this will turn into something more than a flesh wound and so we wait until November to confirm if this week was a;

  • hiccup
  • a leveller
  • or a game changer

Three weeks of Bidderman combined with clearance rates in November will tell us one way or the other.

Big Crowd at 11 Hilda Hawthorn saw three bidders compete until bought under the hammer at $6,030,000. Sam Wilkinson auctioneer

Big Crowd at 11 Hilda Crescent, Hawthorn saw three bidders compete until bought under the hammer at $6,030,000. Sam Wilkinson auctioneer.

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11 Hilda Crescent, Hawthorn (Sam Wilkinson, Kay & Burton), under hammer, $6,030,000, 3 bidders

26 Thanet Street, Malvern (Justin Long, Marshall White), under hammer, $5,105,000, 2 bidders

9 Scotsburn Street, Hawthorn (Antony Woodley, Marshall White), under hammer, $4,510,000, 5 bidders

For all this weekend’s James Auction Reports

Oliver Bruce 5 bidder Volcano at 21 Mary St Kilda West - under the hammer for $4,010,000

Oliver Bruce 5 bidder Volcano at 21 Mary Street, St Kilda West – under the hammer for $4,010,000.

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30 Vincent Street, Glen Iris (Rob Vickers-Willis, Abercromby’s), bought after, undisclosed (passed in at auction for $2,600,000), 5 bidders

8A Dendy Street, Brighton (Nick Johnstone, Nick Johnstone Real Estate), under hammer, $1,900,000, 5 bidders

21 Mary Street, St Kilda West (Oliver Bruce, Marshall White), under hammer, $4,010,000, 5 bidders

For all this weekend’s James Auction Reports

Not a lot happening at the 6 Staniland Malvern auction - passed in on a single vendor bid of $4,000,000

Not a lot happening at the 6 Staniland Avenue, Malvern auction – passed in on a single vendor bid of $4,000,000.

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6 Staniland Avenue, Malvern $4,000,000, passed in, 0 bidders

12 Myambert Avenue, Balwyn $3,805,000, passed in, 1 bidder

37 Middlesex Road, Surrey Hills $3,600,000, passed in, 0 bidders

For all this weekend’s James Auction Reports

All smiles as James Tostevin sells 19 Howard Street Kew under the hammer for $2,720,000. 2 bidders

All smiles as James Tostevin sells 19 Howard Street, Kew under the hammer for $2,720,000. 2 bidders.

Hawthorn, Kew & Camberwell

11 Hilda Crescent, Hawthorn (Sam Wilkinson, Kay & Burton), $6,030,000, under hammer, 3 bidders

9 Scotsburn Street, Hawthorn (Antony Woodley, Marshall White), $4,510,000, under hammer, 5 bidders

19 Howard Street, Kew (James Tostevin, Marshall White), $2,720,000, under hammer, 2 bidders

For all this weekend’s James Auction Reports

Malvern East to Toorak & South Yarra

26 Thanet Street, Malvern (Justin Long, Marshall White), $5,105,000, under hammer, 2 bidders

16 Seymour Avenue, Armadale (Iain Carmichael, Jellis Craig), $3,460,000, under hammer, 2 bidders

 24 Central Park Road, Malvern East (John Morrisby, Jellis Craig), $3,055,000, under hammer, 3 bidders

For all this weekend’s James Auction Reports

Gerald Betts Volcano at 20 McGregor St Middle Park with 4 bidders under the hammer till $4,400,000

Gerald Betts Volcano at 20 McGregor Street, Middle Park with 4 bidders under the hammer till $4,400,000.

Albert Park & Upper Bayside

20 McGregor Street, Middle Park (Gerald Betts, RT Edgar), $4,400,000, under hammer, 4 bidders

21 Mary Street, St Kilda West (Oliver Bruce, Marshall White), $4,010,000, under hammer, 5 bidders

25 Hambleton Street, Albert Park (Greg Hocking, Greg Hocking Holdsworth), $3,105,000, under hammer, 2 bidders

For all this weekend’s James Auction Reports

Brighton & Lower Bayside

11 Gould Street, Brighton (David Hart, Buxton), $3,900,000, after auction, 1 bidder

17 Sims Street, Sandringham (Mark Staples, Hocking Stuart), $2,750,000, under hammer, 3 bidders

83 Sandringham Road, Sandringham (Stephen Tickell, Hocking Stuart), $2,430,000, after auction, 3 bidders

For all this weekend’s James Auction Reports

Negotiation Strategies

You can buy and you can buy well – right now.

Our comments last week on the folly of listening to Macquarie Bank trying to predict the future was not to disagree with them. The market can drop next year, it may have dropped this week.

No, our comments were simply to highlight that it ultimately becomes a waste of time, to focus on trying to guess the market in the future.

Is the market going up or down or sideways or splitting or…… ?

It’s enough to do your head in. It really is. But don’t let it do that.

If you can think clearly, you can buy now (where you haven’t been able to before) and you can buy well (in terms of choice).

Lets get back to basics.

You need shelter for you and your family. You can rent or you can buy.

Big Picture

If you are choosing to buy rather than rent, then you can achieve good emotional and financial outcomes, or you can achieve poor emotional and financial outcomes.

You achieve those outcomes by making good or bad decisions.

You make good decisions by being informed as to;

1.     Your desired outcomes

2.     Your best options

If we had a genie from a bottle and they could help us with only one question related to property, then we would ask them to tell us (as individuals) what is the outcome each of us truly wants in a home and what does that look like RIGHT NOW and in 10 YEARS TIME?

We at James Buyer Advocates would much rather know the answer to this individual question, than say what will the Melbourne Market do NEXT YEAR. Because even if we knew it was going to go up or down for sure, what would we do with that information. What will happen the year after that and after that?

We find that in home buying it is best to live in the here and the now, but with a view to the future on that specific home – not the market.

If it makes sense, buy it now. If it doesn’t, then keep looking.

Years

So what is happening right now in 2015.

We think this is what the consensus is saying. “The influences of the Melbourne Market are fluid right now and therefore the market has an increased level of volatility”

Is this really true?

Is the Melbourne Market really more fluid or are we just talking about it more, or are they one and the same?

Are we in more volatile times than in the past?

This is what has happened in the last decade in Melbourne.

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More specifically, is the market dropping or is this what happens every Middle Spring October market.

2007 – Up
2008 – GFC – Down
2009 – Up
2010 – Down
2011 – Down
2012 – Up
2013 – Up
2014 – Up
2015 – Leveling, Up or Down?

We are not sure about your interpretations on the above, but to us, the overall market in Melbourne always looks volatile.

Is knowing what the market is doing useful? Yes – but mainly in the here and now.

Read on.

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Our auction buy rate at James Buyer Advocates was as low as 10% earlier this year (how could it not be if we were doing our job). We were getting monstered at auction by overseas bidders on good homes. We were forced to look at different strategies and we found them by Easter.

However in the last seven days we have had seven properties in negotiation and we bought six – in fact the only one we missed was at the only auction we had left today. Hawthorn (Peter Vigano); Brighton (Russ Enticott); Glen Iris (Andrew Wilke); Kew (David Filecci); Collingwood (Michael Amarant); Balwyn North (James Scoones); Sandringham (Jenny Dwyer).

For us, knowing the marketplace we are in, is presenting our clients with a number of opportunities.

However knowing what the market place is doing now, is very different from predicting what the market may do next year.

Knowing what the marketplace is doing now, allowed us to apply a counter intuitive strategy which was successful in all bar one deal.

We are not sure how knowing what the market may do next year actually helps our clients, as opposed to knowing what a good long term property is and what it is not.

The market is working for buyers who can think clearly and act, while a number of buyers sit slightly confused on the sidelines.

Our best advice is;

Coming back to BIG PICTURE.

  1. Know what your good homebuying outcomes look like (what are good PPP’s)?
  2. Buy a home that best meets your desired emotional and financial outcomes by buying good PPP’s for you.
  3. Do it now, if it’s right and keep looking if it’s not.

If you can think clearly, you can buy now (where you haven’t been able to before) and you can buy well (in terms of choice).

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