The constant lack of supply seems to be changing buyers’ perceptions. We have noticed over the past few months the increased interest in land being shown by our clients and the market generally. This may have been brought about by the outrageously rising costs of renovating. It can be easier and more cost efficient to build a new home than renovate an existing period home which may still have floorplan problems. This seems to be more prevalent in areas where the land value is $100 – $150 per foot, i.e. Malvern East, Glen Iris, Hawthorn East, Canterbury and Kew. The classic school belt dress circle.
Again, there have been few transactions at the top end, both off market and at auction, reaffirming our belief that for the next month or two it could remain quiet. We hope for a late rush in Spring.
Saturday’s auctions were both hot and cold (as is the weather!). The high profile property at 84 The Esplanade in Brighton, which was quoted at $8 million plus, failed to attract a single bid. Again this shows that, even in a rising market, some vendors’ expectations are completely over the top. The only interest being shown post-auction is from developers.
In Toorak, South Yarra, Armadale, Hawthorn and Canterbury there wasn’t a home for auction over $2 million ? again highlighting the stock shortage.
That said, the mid-market did perform well over the weekend. 42 Batman Street, North Fitzroy, quoted at $820,000 plus, was on the market for $975,000 and sold for $1,073,000 (with 5 bidders). Of the other eight auctions we attended, each had multiple bidding and all exceeded their reserves between by 5-10%.
Looking at current offerings for private sale listed on the internet at over $2 million, there is not one we can suggest that our clients consider. They are lemons, greatly overpriced or just plain ugly. Our advice remains the same: there are more opportunities coming. The big question is when.