Tears, tears, tears. And that wasn’t only the Collingwood supporters.
Spring is supposedly a time of joy, but is now proving to be anything but for vendors. The zing is has left the town. Unless a property is unique, it’s a wallflower (and even for those, there’s no knock-on which can lead to new listings).
And some corrosive ideas are starting to do the rounds: “What will the friends and neighbours think?” “If I sell now, everyone will think it’s because I’m going broke.”
With the papers full of margin calls, profit squeezes and worse, the gossip mills are hard at work on who will be next. And so there’s a trend to off-market transactions.
And then (nice timing) it’s school holidays.
So, against a background of not very much …
9 Douglas Street, Toorak a good 3 bedroom townhouse, on the market at $1.5 million, sold for $1,920,00. Yes, good position, but still a very strong result (breast-beating alert: we bought it as an investment for the vendor).
Others didn?t have that sort of joy:
- 3 Myamyn Street, Armadale sold for $2.3 million. A Victorian in need of work, it had a possible $2.5 million expectation.
- the house that had it all: 19 Glenbrook Avenue, Malvern East passed in and sold later for $3.85 million.
And then there was some real pain.
- 19 Lambert Road, Toorak didn?t even make it to auction
- 21 Park Street, South Yarra failed to attract any interest
- 12 Davis Avenue, South Yarra ditto.
Now is the Spring of vendors’ discontent … with little glorious Summer in sight.
Bayside. Biz as usual:
Lies, Damn Lies and Published Clearance Rates
With the daily newspapers trumpeting the weekend auction clearance rate having jumped to a six month high of 68%, buyers may be thinking that the tide has turned and there are agents who are happy to promote the idea.
Then consider an alternative interpretation, and what that means for buyers:
- last weekend only 539 properties were scheduled for auction compared to 765 offered at the same time last year
- 30% fewer on offer means that clearances have to soar just to maintain what was
- the REIV’s numbers include properties sold prior to auction, making auctionclearance rates appear even higher
Why does this matter to buyers?
If you are bidding at an auction, the number that matters is the percentage of houses which are actually being sold at auction. If you believe that’s 70%, your strategy will be very different than if the real number is, say, 30%.
And the real number is a lot closer to 30%
So what happened?
In Bayside over the weekend, 39 properties were scheduled for auction but close to 25% of those were reported as sold before auction.
Brighton had 12 auctions scheduled. The raw numbers suggest that 6 were sold, an apparent 50% clearance. But with 3 of those 6 sold prior, real clearances on the day dropped to 3 from 9; a less than flattering 33%.
(The number of vendors selling prior has been slowly edging up over the past couple of months, which suggests the opposite to a market that is becoming stronger. It’s more a case of the agent and vendor accepting that a bird in the hand is worth more than, etc.)
One of the sold-prior properties was 19 Bourneville Avenue, Brighton East. A substantial and well built new house with a basement garage and pool, it was being quoted at $2.15-2.45 million. An offer of $2.25 million was apparently bravely refused earlier last week. Common sense obviously prevailed; although the final sale price was not disclosed.
4 Newbay Crescent, Brighton sold prior, for $2 million.
A resort-style contemporary family home at 11 College Grove, Black Rock sold for $2 million
An older style unrenovated house on over 1300 sq m at 23 Chatsworth Avenue in Brighton?s Golden Mile has quietly sold for a figure believed to be $5.5 million; after coming onto the market for the first time in 70 years with a $7 million plus expectation.
And finally to venerable Bentleigh, where sold before and private sale are proving more successful in recent weeks. 1 from 6 sold under the hammer and 4 others scheduled for Saturday selling sold prior; plus a very healthy 10 private sales being negotiated during the week.
Where to find the action over the next two weekends?
- where the school kids (and their parents) are on holiday
- the G.
- the beach at Port Douglas
The next significant auction weekend is not until October 4.
Save your litmus paper until then.