This week’s clearance rate was a new high for Melbourne so far in 2015’s auction results. A jump of 5 per cent from last weekend’s results saw the final clearance rate land on 82 per cent across Melbourne. There were 940 auctions this weekend with 775 properties selling and 165 being passed in, 79 of those on a vendor bid. There were an additional 473 private sales reported.
While Melbourne’s east is still in the highest demand with buyers – it is clear that Melbourne is experiencing a spread of the boom sales conditions that were previously centred on the eastern suburbs. In this current climate, it’s not unusual to see that a home in Caroline Springs sold for $1.59 million, where the average median house is $456,000, as the demand for houses between $1 million and $4 million was upbeat on the weekend.
There has been talk in the media recently about Melbourne showing signs of being in a housing bubble due to the price growth and auction clearance rates over the past few years. This continues to be a contentious discussion point, and with lower interest rates, the scene is set for continued growth in property values and sales. We should remember that as winter is closing in, there is expected to be less properties around, so the next month or so will be a good test of the market.
Auction Results
11 Hawson Avenue, Glen Huntly. Sold for $1,710,000
This beautifully renovated Californian Bungalow drew an enourmous crowd of over 200 people to Glen Huntly to catch the auction on Sunday. As it was quoted prior to auction at $1,180,000 – $1,280,000, there were gasps from the crowd when a strong opening bid of $1.4M was put forward. This was no surprise to those who were there to bid as the property was soon on the market at $1.5M. There were 5 unique bidders at this auction pushing the price to $1,710,000 where it was sold. This was an extremely strong result for Glen Huntly, as the last family home sold on this street was $1.2M in December of 2014.
39 Henry Street, Northcote. Sold for $975,000
This superbly located home tucked neatly into a quiet street of single story period houses in the popular Ruckers Hill precinct, whilst being close to the Westgarth Village as well as High Street Cafes and public transport. This contemporary single fronted double storey, 3 bedroom house galloped off from a start of $800,000 to achieve an over the odds result. It was declared on the market at $830,000, and 2 bidders in a crowd of approximately 30 onlookers raced to the finish of $975,000 in 39 bids.
82 Maud Street, Balwyn. Sold for $3,083,000
This large 933SQM original clinker brick home on a corner block in the Balwyn High School zone attracted a lot of attention over the weekend. In original internal condition, it was touted as a site to develop or build a new luxury home in the highly sought after zone. 6 bidders managed to raise their hand before the auction raced away, and applause came from onlookers as the price broached the $3 million threshold. The home eventually sold well in excess of the $2.2M reserve at $3,083,000.
There’s a secret to getting a house in one of Melbourne’s up-market suburbs.
Find our very own Kim Easterbrook commenting on ‘hidden gems’ in the Herald Sun here.
With fewer properties going under the hammer this weekend buyer demand is still strong, as evidenced by the clearance rate of 76 per cent. There were 823 auctions this weekend with 629 properties selling and 194 being passed in, 83 of those on a vendor bid. There were an additional 425 private sales reported.
Some hot competition for quality properties was seen on Saturday with hundreds of auctions experiencing three or more bidders. Demand in Melbourne’s inner and middle-ring suburbs is particularly strong.
The recent interest rate cut may be spurring on a higher level of buyer presence and activity in the market – especially with “lifestyle buyers” such as downsizers and first-home buyers.
The first-home buyer segment of the market are feeling the heat from downsizers when it comes to finding properties in close proximity to the city. Kim Easterbrook, in The Herald Sun on Saturday explains that buyers were settling for “stepping stone” first properties close to transport, which would prove good investments down the track.
According to Core Logic RP Data, the growth in house prices in Melbourne in the year to March was around 6 per cent, and double-digit growth is highly likely in 2015 for the inner suburbs. There is no doubt that these results have an affect on buyers wanting to secure a property at an affordable price.
The highest sale price recorded this weekend for a house was for Banyule Homestead in Heidelberg, which fetched $5,200,000.
Auction Results
1/50 Gold Street, Brunswick. Sold for $512,000
This centrally located boutique 2 bedroom apartment in a block of only 8, drew around 30 people to its auction. Quoted before auction with a range of $440,000 – $480,000 this beautifully renovated apartment, only a short walk from Sydney Rd trams and shops, appeared to be an ideal purchase for a first home buyer or young professional looking for a city lifestyle. The bidding opened at $450,000 and was quickly pushed up $10,000 by a second bidder. After some rapid back and forth bidding, the auction ended at $512,000 won by the original party.
16 Panoramic Grove, Glen Waverley. Sold for $2,178,000
A three bedroom home bursting with potential for developers to take advantage of. This attracted a huge crowd of more than 150 people to the auction. Located in the highly sought-after Glen Waverley school zone, and a guide price of $1.5million+ this property had no less than eight bidders. All of them developers, putting their hands up during the 25 minute auction where 56 bids were placed. The price soared more than $500,000 above the reserve when the hammer was brought down. The final bid was delivered by a local developer, who only made a single bid of $1000 to secure the property. The final result was one of the highest prices per square-metre for the suburb.
29 Buckingham Avenue, Bentleigh. Sold for $1,123,000
A large crowd of over 50 people watched this three bedroom townhouse go under the hammer. Being in the very highly sought after McKinnon Secondary school zone, a high level of competition was expected. This was shown by a very strong opening bid of $950,000 and the pace at which it moved with quick $10,000 rises to $1.05 million. With a slight change of speed, the auction slowed down to a crawl and announced by the auctioneer as ‘the most boring auction of the day’. It was eventually won for $1,123,000
The interest rate cut has spurred a greater interest at auctions over the weekend, and the resulting clearance rate of 81 per cent highlights a demand for Melbourne property. There were 904 auctions this weekend, with 732 properties selling and 172 being passed in, 78 of those on a vendor bid. There were an additional 426 private sales reported.
Tuesday’s record low 0.25 per cent interest rate cut may have influenced the large buyer presence at auctions this weekend; just as it did in February when official interest rates fell by 0.25 per cent. Buyers were prepared to stretch their budget a little bit further, and bid harder at auction on Saturday.
The other factor that has influenced results is the relatively low stock levels currently available. The cooler months are typically more quiet across Melbourne’s real estate market, and no doubt many buyers have this in mind when they are bidding, as they don’t want to miss out.
The highest residential sale result on the weekend was for a four bedroom house at 40 Anderson Road, Hawthorn East, which sold for $4.82M. While a three bedroom property at 8/57 Orrong Crescent in Caulfield North, which sold for $1,950,000, became the highest price paid for an apartment this weekend.
This week, Credit Suisse estimated that Chinese investors are expected to spend $60 billion on Australian Housing over the next 6 years, with the majority of that concentrated on Sydney and Melbourne. Currently in Melbourne, Chinese demand is running at 20 per cent of new housing supply. It’s important to remember that this foreign investment is concentrated on brand new houses in estates, and brand new inner-city apartments – not established homes.
Next week there is an estimated 790 properties due to be auctioned.
Auction Results
15 Bridge Street, Hampton. Sold for $3,100,000
Over 60 people squeezed into the front yard of this five bedroom, three bathroom, magnificently updated 1920s build. A slow start to what was to be a hotly contested auction kicked off with a bid at $2.1M which was immediately beaten by a more realistic vendor bid of $2.5M. The first bidder did not raise his hand again, instead leaving it to two others to fight it out with $50K rises until it hit $2.85M. At that point one of the two raised the stakes offering a $3M bid, not to be outdone, the other interested party bounced straight back with another $100K ($3.1M) to win the auction.
636-638 Park Street, Carlton North. Sold for $1,730,000
Only 50 metres from Princes Park, and was quoted between $1.3M and $1.4M, this grand Victorian Terrace attracted a crowd of 45 onlookers for the auction on Saturday. The potential for improvement in this four bedroom, three bathroom home motivated five bidders to put their hands up after the opening offer from one man of $1.2M. The property was announced on the market at $1.5M, and eventually sold to a late entrant for $1.73M, which was $380,000 above the reserve.
22 Dunraven Avenue, Toorak. Passed in at auction.
This beautiful 1956 built solid brick home in an ideal blue-chip Toorak locale, with four bedrooms and a pool was the scene of a challenging auction. Despite the updating and renovating that went into this home, the first thing the auctioneer brought to the attention of the 50+ people in attendance, was the fact that yes, it could indeed be demolished and a new home built – as has been done by the neighbours on either side of the property. The auction struggled to find a starting point, so a vendor bid of $4.25M began the official proceedings. With nobody wanting to make a move, the property was eventually passed in and negotiations with at least 3 interested parties took place behind closed doors.
Large crowds and a high number of bidders at auctions on the weekend as the market powered back after the Anzac Day break. The clearance rate of 80 per cent gives a good indication as to the strength of the Melbourne market. There were 929 auctions this weekend, with 746 properties selling and 183 being passed in, 85 of those on a vendor bid. There were an additional 507 private sales reported.
If you’ve been paying attention to our weekly market updates, you might have noticed the strong results we’ve been reporting this year in private sales in addition to the strong auction market. There has been a growing number of off-market sales in Melbourne, as many buyers are trying to avoid the heat at auction. The prestige segment of the market is well known to achieve off-market sales, but this year pre-auction sales have become more common in lower price brackets.
The March quarter results have shown that the median house price in Melbourne’s inner suburbs has risen to $1.1 million. Following this trend, we’ve seen that the top three performing suburbs this week were South Yarra, Richmond and Brunswick – all on the fringe of the city.
Reports of new State Government property taxes to be introduced for foreign buyers has given the real estate industry a shake up. Not only will non-residents have to pay an additional 3 per cent of the purchase price in stamp duty from July 1, there are also plans for an absentee land tax of 0.5 per cent from 2016, for any foreign buyers who do not occupy their property. It will be interesting to see how the next few months play out with the governments’ moratorium on foreign investors who have illegally purchased existing homes in Victoria (instead of buying new builds). It may cause a surge of properties being added to the market before November 30, as those foreign owners take the opportunity to sell their properties before the strict punishments are implemented.
Next weekend there will be over 880 auctions expected to take place.
Auction Results
5 Carool Road, Carnegie. Sold for $1,520,000
Targeted at developers and quoted prior to auction at $900,000 – $990,000 this three-bedroom knockdown home on a 766m2 corner allotment with permits for 2 townhouses, was a rare find indeed. In 2013, this property sold for $850,000. The opening bid of $1 million already reached the vendors’ reserve and three bidders took the price over $1.2 million where it was announced on the market. A fourth bidder joined at $1,305,000, but bowed out only $10,000 before the final bid which was astonishingly $520,000 above the reserve. The new owners are two friends who intend to build neighbouring townhouses.
6/11 Rockley Road, South Yarra. Sold for $880,000
Located in one of South Yarra’s beautiful tree lined streets, this top floor, rear facing, 2/3 bedroom is in a comfortable but dated condition. With a spacious layout and close proximity to vibrant Toorak Rd, Chapel St and leading schools, it was no surprise that over 90 people attended this highly charged auction. 9 bidders battled it out from opening bid of $600,000 to the final result of $880,000 – much to the amazement of neighbours who witnessed the sale of a fully renovated apartment in the same block in 2013 for $704,000.
17 Carew Street, Sandringham. Sold for $1,940,000
This beautifully renovated four-bedroom period home in a highly sought after location close to shops and the beach unsurprisingly attracted a large crowd to the auction, with four bidders amongst them. The auction opened with a vendors bid of $1.6m and was slow to gain momentum, but once the auctioneer enticed some participation, two bidders quickly took the property price to $1.825m, where the first bidder dropped out. Two late comers were the last two left when the property was announced on the market at $1.87m and then sold for $1.94m.
A large number of auctions were held in Melbourne on the weekend, partly due to vendors hoping to sell before Anzac Day. The result shows how strong the market is right now – a clearance rate of 79 per cent. There were 1077 auctions this weekend, with 851 properties selling and 226 being passed in, 118 of those on a vendor bid. There were an additional 466 private sales reported.
Properties in the $1 to $2 million price range attracted some serious attention on Saturday, with many far exceeding their reserves – some by $450,000. The ripple-effect is becoming quite pronounced as buyers are looking at the next best suburb if they are being priced out of their first choice suburb.
What areas of Melbourne saw the most auction activity this weekend? The western suburbs again held higher auction numbers of about 200, compared to the normally strong eastern suburbs which held 118 auctions. As a sign of buyer depth, many outer areas are now increasing the number of auctions held. Traditionally these areas have more private treaties because there is normally more properties available than buyer demand, however this trend is changing. Agents are reporting that one possible reason for this is due to people moving to the outer areas of Melbourne after being priced out of the Sydney market.
Next Saturday is the 100th anniversary of Anzac Day, and only 81 auctions are scheduled, so our next market wrap will be in two weeks time.
Auction Results
13 Hardy Street, Brunswick. Sold for $1,300,000
This property was quoted between $1 million and $1.1 million before auction. A renovated and extended four bedroom Victorian home, located close to schools and Sydney Road shops was popular with a few bidders on Saturday. The auctioneer began with a vendor bid of $1 million to start, then asked for $50,000 rises. Two parties rose to the occasion, helping the property be announced on the market after the fifth bid. At this point a man with his daughter entered the competition and bid strongly to pay $100,000 above the reserve, and become the new home-owners at $1.3 million.
11 Albert Place, Richmond. Sold for $1,335,000
A crowd of about 30 people had gathered to watch this three bedroom, two bathroom townhouse go under the hammer. The auction began when a woman on the phone raised her hand to agree to the auctioneer’s suggestion of offering “a million dollars”, then another three bidders became involved. The last bidder to join in had the best staying power as their final bid of $1,335,000 successfully demolished the competition.
7/151 Glen Huntly Road, Elwood. Sold for $341,500
This entry level, updated one bedroom apartment with car parking attracted three bidders, all being first home buyers who all attended the auction with their parents. Bidding opened up at $300,000 by a very nervous first home buyer but the other two parties had their parents bidding for them. The property was announced on the market at $340,000 and two further bids saw the property sell for $341,500 to a very excited first home buyer.
The Melbourne auction market returns after the Easter break with similar energy as before Easter, showing the school holidays have not kept buyers away. There were 555 auctions this weekend, with 431 properties selling and 124 being passed in, 62 of those on a vendor bid – resulting in a clearance rate of 78 per cent. In addition to the auctions there were also 455 private sales reported.
These results continue to add weight to the claims of Melbourne having a two-speed auction market, as budget suburbs continue to lose out to the higher priced locations such as those in the inner East. But these uneven results mean that conditions could not be described as a total seller’s market as there are still many properties which are selling for prices close to their reserve.
The top auction suburbs this weekend were Reservoir (11 auctions), Mt Waverly (10 auctions), followed by Carnegie and South Yarra each with 7 auctions. But overall it was the western suburbs who dominated auction numbers this weekend with a collective 102 listings. The eastern suburbs will likely dominate auction numbers again next weekend as it seems that vendors have avoided the school holiday period for listings.
Next weekend an expected 1060 auctions are scheduled.
Auction Results
2 Palmer Street, South Melbourne. Sold for $3,210,000
Eighty people attended the auction of this impressive four-bedroom house with a pool and rooftop terrace, including parties from New Zealand, the USA and China. Four bidders, two on phones contested until it was announced on the market at $3 million, which knocked out the third bidder. It wasn’t until the property was almost sold at $3.17 million that the fourth bidder appeared, and added three more bids and successfully bought the property.
23/156 Rose Street, Fitzroy. Sold for $1,400,000
This designer warehouse apartment in a former chocolate factory has city views, direct lift access within the mulit-level contemporary industrial feel property. A vendor bid of $1 million kicked off the auction with four hopeful buyers pushing the price past the reserve of $1,225,000. But it was a young couple who joined the bidding mid-way through the auction who trumped the competition with their confident bids and walked away as the new owners of the three bedroom apartment.
23 Cornell Street, Camberwell. Sold for $3,000,000
It was a full house on Saturday with over 110 people attending the auction of this newly built luxury French provincial home. After some coaxing by the auctioneer, the opening bid came in at $2,000,000, two other parties then stepped in bidding in $50,000 rises. The property was declared on the market at $2.75M and a fourth bidder stepped out of the woodwork right when it began to slow down. It picked up again until it reached $3,000,000 where it was won.
Great confidence in the market is highlighted by the bidding on the weekend, and the resulting clearance rate of 79 per cent. There were 1336 auctions this weekend, with 1050 properties selling and 286 being passed in, 127 of those on a vendor bid. In addition to the auctions there were also 506 private sales reported.
The high clearance rate from the large number of auctions across Melbourne on the weekend is more evidence of strong demand from buyers, making this first quarter of 2015 remarkable. Melbourne is very close to becoming a boom market, with multiple bidders willing to pay well above the reserve to secure certain properties.
The high-end of the market has seen some activity this week, with a landmark Kew estate, on the banks of the Yarra, selling at a private auction for over $5.75 million.
Due to the Easter long weekend there will only be a handful of auctions next week, so our next Market Wrap will be in two weeks! From all the team at Elite Property Advisory, we hope you all have a happy and safe Easter break.
Auction Results
13/108 Moor Street, Fitzroy. Sold for $1,310,000
This recently refurbished top-floor warehouse apartment had views overlooking Fitzroy Townhall, as well as multiple living zones, two bedrooms with two bathrooms. It had a tough time generating bids despite the good crowd of 60 onlookers at the auction. A vendor bid of $1.1 million began the auction, and was upped by a couple offering $1.12 million. A second vendor bid of $1.15 million encouraged the couple to increase their offering to $1.16 million. The property was passed in but was sold during negotiations with the couple, who agreed to pay $1.31 million.
378 Punt Road, South Yarra. Sold for $680,000
With a price range of $450,000 – $490,000 in the much-coveted suburb of South Yarra, this property was indeed full of potential for developers or renovators. The three level, three bedroom property, in a state of disrepair had 20 building inspections prior to the auction, with ‘danger’ signs and grafitti throughout the property. The auctioneer accepted an opening bid of $380,000, which was followed by many $10,000 and $5,000 rises until it was eventually on the market at $520,000, before being announced as sold at $680,000.
1/7 Hillston Road, Moorabbin. Sold for $755,000
Thoughtfully renovated to a high standard, this brick, street-front Moorabbin family home has been subdivided from a new townhouse behind. This well received formula in Melbourne’s inner suburbs is now being applied progressively further out, resulting in affordable, good quality housing on smaller allotments. Opening at $650,000 and with over 50 groups attending, 4 bidders quickly placed the property on the market at $750,000 and saw it sold at $755,000.
Strong sales results were reported this weekend with a clearance rate of 77 per cent, and buyers are continuing to face tough competition. There were 1096 auctions this weekend, with 846 properties selling and 250 being passed in, 113 of those on a vendor bid. In addition to the auctions there were also 438 private sales reported.
Properties in Melbourne’s eastern suburbs are experiencing strong demand this year, showing that the market has turned in favour of vendors. With less stock on the market than this time last year, as well as the cheap finance available to buyers, there is tough competition in some pockets of Melbourne – particularly the east, the inner-south, the inner-north and some bayside areas.
Is this a boom period? Well, some areas experiencing above 80 per cent clearance rates are booming. While other areas, such as the western suburbs holding high levels of listings, and a lower proportion of sales, are not doing as well.
If this is a boom period in Melbourne’s property market, will we start seeing reserve prices go up? Possibly, but we suggest that vendors proceed with caution as this tactic doesn’t always work, and astute buyers will always know the right point to walk away from a price.
Auction Results
22 Budd Street, Brighton. Sold for $1,820,000.
Recently revived by an interior designer to open it up and extend it further out, giving a contemporary touch to this c. 1880 Brighton double-fronted property. This well located home attracted 120+ people to the auction, with 5 bidders amongst them. The opening bid of $1.5 million was challenged by a flurry of bids, as the price sailed on past the reserve of $1.75 million, until finally being announced as sold at $1.82 million.
10 Howard Street, Brunswick. Sold for $881,000.
With architect-designed extensions, this superb Victorian cottage close to the cafes of Sydney Rd and Lygon St provided a great setting for a heated auction. One man wishing to buy the property for his wife’s birthday opened with a bid of $740,000 before another man offered a huge rise of $800,000. The first man wasn’t giving up so easily, and continued to increase with $1,000 increments to each offer his competitor made. At $870,000 this tactic worked, and the second man bowed out, just as another two would-be buyers jumped in, one of whom became the new owner at $881,000.
13a Norfolk Road, Surrey Hills. Sold for $1,920,000.
Built in the 1940s with significant English style on a large block of land – approximately 929sqm, this appealing family home was very attractive to a range of different buyers. The five bedroom home could either be left as is, extended further, or rebuilt completely. The opening bid of $1.4 million was further challenged by two other bidders who helped the property get announced on the market at $1.7 million. A fourth bidder became involved with five $1,000 rises, but it was the original bidder who successfully bought the property at $1.92 million.
Vendors have been pouring properties onto the market to take advantage of the selling time before Easter, and the result was a 78 per cent clearance rate. There were 959 auctions this weekend, with 752 properties selling and 207 being passed in, 100 of those on a vendor bid. In addition to the auctions there were also 352 private sales reported.
Last weekend’s clearance rate of 70 per cent was surprisingly strong for a long weekend. While this weekend’s result came from a wide mix of listings available for auction, with some lower priced properties in the western suburbs and inner-south making an impact in the weekly figures. Despite this, the higher level market is still holding well.
It may have been the lovely sunny weather, but some auctions received crowds of 200 attending on Saturday, which is a good sign for vendors hoping to sell before Easter.
There is little doubt that some suburbs of Melbourne will expect modest price growth this year, as the demand for properties located within areas with good public and private schools is being driven by upgraders taking advantage of the lower interest rates.
Even the sandbelt suburb of Black Rock experienced a record sale price on Saturday, reaching a staggering $1,010,000 above the reserve and setting a new residential record price of $3,810,000 for the suburb.
Auction Results
1a Kinross Street, Hampton East. Sold for $781,000.
Secured behind high garden fences, this two bedroom home is surprisingly spacious with two living areas and an entry level price quote of $580,000 – $640,000. The auction on Saturday was attended by thirty people, with three parties pushing the price up to $700,000 when it was announced as “selling”. The bidding did not stop there, as the auctioneer accepted bids from three different directions until the hammer was finally brought down at a price of $781,000.
2 Deal Close, Moorabbin. Sold for $820,000.
One of Moorabbin’s unique solid brick post-war homes went under the hammer on Saturday. Made from local concrete Besser blocks, the 3 bedroom family home with a quality renovation, family sized garden, garage parking and quiet cul de sac location seemed the perfect formula for this popular auction which attracted over 60 onlookers. Opening at $710,000 and on the market at $810,000 the fierce bidding from 3 prospective buyers saw the property sold for $820,000 to the applause of the crowd.
11 Tucker Place, Fitzroy North. Sold for $3,571,000.
This unique warehouse conversion, designed by Daniel Van Cleemput, with six bedrooms and an emphasis on space and light, attracted a large crowd to the auction. One man made a $3 million opening offer, which was topped by a woman adding another $20,000. The bidding continued between the two until $3.34 million when a third prospective buyer jumped in, and the property was announced on the market just shy of $3.4 million. However, it was the first bidder who was able to outshine everyone and take the keys for $3,571,000.
