While it was reported investors would hold back on the weekend, they clearly were not reading the newspapers.
World equity markets were in turmoil and Melbourne’s upper-end residential market did not skip a beat. If anything, it rose to new heights. Yes, people still want to buy better houses and they’re voting with their cheque books.
A classic example was the auction of 111 Sackville Street in Kew. This house sold 12 months ago for $3.225 million. A period home on 23,500 square feet and nothing special: no court, no pool, no “wow”. The reserve was $4.3 million. It sold for $5,250,000. Just a cool near-million over reserve!
In South Yarra two older style apartments at 273A Domain Road each had multiple bidders. They sold for $1.250 and $1.335 million.
Clearly, the buying public is not looking at sharemarket trends.
The middle market also proved strong. 128 Through Road, Camberwell, a renovated weatherboard Californian bungalow with some issues was expected to sell for $1.1 million. Four bidders took it to $1,305,000.
2 Lloyd Street, East Malvern had a realistic expectation of $1.6 million yet sold for $1,970,000 ? again with multiple bidders.
These sales represent the strong interest in the school belt among 35-40 year olds.
A pair of houses at 2-4 Ercildoune Avenue, Caulfield had a reserve of $950,000 and sold for $1.445 million with no fewer than 10 bidders! Even a mortgagee’s auction in Brighton, at 125 Male Street, with a reserve of $800,000, sold for $1,005,000.
The trend predictor among these sales is the number of underbidders who are still looking. Their pressure on prices will remain – at least until a lot more stock becomes available. Hurry Spring!
Toorak, South Yarra and upper-end Brighton were quiet as all the big sales start next weekend.
Land sales continue to dominate off-market transactions with a new record being set in East Hawthorn: $257 per foot. 12 months ago you could have bought there for $120 per foot. However, larger blocks do not necessarily equate to the same cost per square foot; 6 Lytton Grove in Kew was passed in for $2,970,000 against a reserve of $3,050,000. That’s around $200 per foot and something of a surprise; however it did have a narrow frontage. At these levels people start looking towards their exit strategy and you have to question whether $5.5 – $6 million in that position is a near-future possibility.
What?s encouraging? Over the past week we have seen many newer properties listing for Spring. The hope is that greater choice will take some of the heat out of the market.