The punter’s dilemma

It’s been opined that the sums bet on a horse race have little relationship to the value of the horses in the field.

We’re seeing a fair bit of that at the top end. There’s a disconnect between prices and values – only it’s houses, not horses – particularly in the minds of many vendors and their agents.

And now it’s Spring and both bookies and agents have their eyes on the big prizes. The agents, with an ever-increasing field of stock, are out there and leading the cheering.

But cheering … for what?

Most of the houses we’re seeing are still nags; good only for nurturing the hopes of their owners and those fool enough to back them. About one in twenty are worth their bale of chaff but the rest have issues ranging from aspect to neighbourhood to layout to rising damp to…

Then there’s – not the stayers – the never-go-awayers. Houses which failed to finish as long ago as last Spring and which are still running; while the agents clip those same old tickets again. And again.

And then there are the punters. Always the punters. How else are the agents to keep up the payments on their BMWs?

Choke on Wheaties time: Dunraven, apparently, sold on Friday for just $13.5 mill. (and on terms). Told you so. Months ago. While that was way below some offers some agents reckoned they had in hand.

How is it so? Could an agent or three be trying to talk his way into the big time by exaggerating the offers they are holding?

And who do they think they are kidding?

And so to a damp weekend:

100 Victoria Avenue, Albert Park sold and sold well. $3,220,000 and three bidders.

Toorak? One sold, five passed in on vendor bids. Not worth getting out of bed for.

Highlight out of the spotlight? 98 Finch Street, Malvern East. Sold before auction at what is rumoured to be around $7 million. If that’s so, there’s a punter born every minute.

Next weekend? A monster. Melbourne Cup proportions. But let us remind you that the sums bet on a horse race have little relationship to the value of the horses in the field; and suggest that you do a lot of looking at animals in their mouths.


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Bayside Battered

Not helped by piercing winds and regular hail showers, Bayside suburbs from Brighton to Mordialloc all struggled with just a 51% success rate, significantly underperforming the Melbourne-wide clearance rate of 63% as noted by Australian Property Monitors (against the figure claimed by the REIV of 68%).

Brighton and Brighton East were among the worst performers: from the ten offered, just a miserly two sales on the day (plus two recorded as sold before). Between them, all four auctions in Brighton proper failed to raise a single bid. How will they cope with 46 scheduled auctions next weekend? Pass the antacids.

54-56 Asling Street includes two adjacent modest brick houses on combined land of just on 1700 sq m. Notwithstanding the railway line over the rear fence you would think such a wide site close to shops (and transport!) would be snapped up by eager developers and builders. Not so. The best and only bid was the auctioneer’s $3.3 million. Asking price is now set at $3.75 million.

8 Windermere Crescent is a substantial six bedroom family house in impeccable order and on a family size block of  930 sq m. It’s close to several schools and only a 10 minute saunter to the beach. Its auction opened with a brave vendor bid of $2.9 million, followed by stony silence from all present. With the reserve now published at $3.35 million it is hard to imagine this will be an easy one to get away.

What sold?

  • 1A Higginbotham Street, a townhouse, sold prior for $1.675 million
  • 39 Regent Street, Brighton East. A 1970’s single level house with a pool and on 930 sq m with its rear to the north and close to a park. Reported sold for exactly $2 million.
  • 22 Tennyson Street, Brighton. A month ago we reported its sale for a tad over $5 million. Apparently that sale cooled off and it has been resold for what we hear is now a tad under $5 million. Even tads can hurt.

Beaumaris and Black Rock had one sale between them and one sold prior:

That’s a change in the weather for Black Rock. It has had solid sales in recent weeks, particularly along Beach Road.

Bentleigh’s highest was at 12 Sunnyside Grove, sold for $1.165 million, but elsewhere in the suburb results were mixed.

Seems even venerable Bentleigh is not immune from the measured caution of buyers.

Hampton and Sandringham had a rostered day off, but we expect lots of news following next weekend’s offerings.

And so to Elsternwick, which had a busy weekend for properties in the upper price band.

  • 42 Bertram Street, a well renovated and extended brick bungalow, drew a decent crowd but only a bid of $1.75 million from a solitary bidder before it was passed in. Intense discussions followed before a final figure of $1.89 million was reached. Smiles, sighs of relief from the respective parties.
  • 67 Shoobra Road, a little earlier, sold for the not inconsiderable sum of $1.6 million. A shell of a double-fronted brick Victorian on 711 sq m, it’s barely liveable and needs at least another half a million to get it close to right.
  • 36 Elizabeth Street, in arguably Elsternwick’s finest location was auctioned on Sunday, was passed in then sold shortly after for a price believed to be a tickle under $2.3 million. Great bones and structure, but expect to see the inevitable builders truck’s there in the not too distant future.

And then came …

  • 44 Orrong Road, a well renovated and extended Edwardian weatherboard house on decent land. Quoted “aggressively” (agent’s description) at $1.6-1.7 million and with the vendor’s reserve in the range, the property attracted one obvious bidder and one “bidder at the back” (according to the auctioneer) before being passed in at $1.625 million to obvious bidder (obviously). It sold a little later for $1.7 million. Overall it was a well managed and predictable campaign but, in keeping with the current trend, only able to produce a solitary (obvious) bidder as far as most of us could see.

With 1200 auctions scheduled for next weekend, amber warning lights are well and truly flashing.

Whether they change to Red or Green remains to be seen.


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