(Originally posted March 29, 2010)
Yup. Us.
Last week we were announcing cracks in the edifice of the top end. This week we, and anyone else foolish enough to venture an opinion, have been slapped in the face by the cold wet fish of reality.
Where’s your Nostradamus when you need him?
And if you are listening, Michel, could you give us a sign regarding where this roller-coaster of a market might go next?
We now stare into the abyss of April: Easter and the Anzac Day long weekend loom, when the lights will dim more surely than Earth Day. The large question is where will we be when they flicker on again?
And so to the joys and sorrows of the weekend. Joys which were all among the vendors; both on- and off-market.
8 Bromley Court, Toorak, prime land, sought by two people, sold for $10 million and there’s a single-level covenant so you can’t even build a two storey house there.
But hotter still was Hawthorn.
5 Moore Street, not a AAA address, but a good, well renovated Victorian on 14,000 square feet. It sold for an amazing $6,450,000. Fluke? Not exactly. There are still three under-bidders out there and house-hunting.
They’re not alone. In several other $6 million + properties, we were competing with more than one other party.
This will be tested further later today when Expressions of Interest for 482 Barkers Road Hawthorn East will close. There’s an expectation of $11 million; which we expect is a lot of money for a busy road.
Even further down the scale bidding could be frenetic. 18 Northcote Road, Armadale, a double-fronted Victorian with position issues had expectations from all concerned of $2-2.2 million. It sold for $2,810,000. Nice result for the vendors, however, they had already purchased nearby for about that amount; but twice the size and twice the position.
Highlight among the units was 3/112-116 Leopold Street, South Yarra. It sold for an impressive $3,215,000 with multiple bidding, which reaffirms the incredible appetite of the buying public to secure properties west of Punt Road in South Yarra.
So where are all these cashed-up buyers coming from? Where is that river of money being dammed?
Here, people. Here. While the agents are trumpeting their recently acquired international marketing skills, at the top end the people signing the cheques are, overwhelmingly, locals.
Underquote? Moi?
Ask the agents and you’ll be told that under-quoting is inevitable in a rising market. “Can’t be helped. We’re doing our best.”
Ask anyone else and they’ll tell you it’s predictable, deceptive and should be stopped. Ask us and we’ll tell you it’s a battle we’ve been fighting these last seven years.
The Age, to its credit, has again taken on the (agents’) hand that feeds it by, again, detailing some of the malpractice and some of the near-futile efforts of the ACCC, etc., to stop it.? We now have a near-unenforceable law demanding ethical behaviour from too many agents who have no wish to comply.
The irony is that it is the agents, too, who are harmed by every rotten apple in their barrel. When in decent company they’re ashamed to admit to being estate agents, they should know they have a problem.
But if they are the new social outcasts, it is they alone who are to blame; and they alone who can do something about that.
David Morrell
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Bayside: Slowly
Whether it was the distraction of the GP or the commencement of the school holidays, Bayside was certainly more subdued after the frenetic activity of the week before. Auction attendances were down and bidding was more measured.
Did that have to do with the quality of the properties on offer or are buyers simply showing signs of battle fatigue following relentess weeks of dealing with misleading price expectations and the emotional consequences of, in many instances, missing out by hundreds of thousands of dollars.
Of the transactions noted from the past week, the sale of 31 Gordon Street, Hampton (and guys, it is not in Brighton Beach as reported) is worthy of comment. TET was given a heads up three weeks ago by the vendor’s representative that an offer had been made “at very close to $5 million”. Seems this may have been a figment of a fertile imagination because we can report the property was sold last week for $4.5 million, a mere half a million or so shy of the mark. Now this was an Expression of Interest campaign, which is a fancy name for a private sale in which the buyer is left to guess what the vendor wants, and is then fair game when trying to assess the real level of interest and fair value for the property. In this case we did some checking before the close of the EOI and it appears the vendor was blissfully unaware of the offer “very close to $5 million”. You have to ask, who is this nonsense serving?
The highest auction result on the day in Brighton was at 133 New Street. A substantial period house on 1174 sq m, it sold for $2.74 million.
56 St Andrews Street, ‘tween Bay and Church Streets, attracted two bidders but stalled after it was declared on the market. It sold for fair value at $2.61 million.
125 North Road sold prior to auction for $1.955 million. Ditto up the road at 2/48 North Road: $1.606 million.
A private sale during the week of an unremarkable 80’s style house on 900 sq m at 8 Wallace Grove, points to the strength of the market in the early months of 2010. Following a failed marketing campaign late last year in which the best nibbles were in the mid $2 millions, and following a change of agent, the property has just been sold at a very respectable $2.85 million – a handy 10% premium in five months.
As reported in recent weeks, Brighton’s top end (over $5 million) has been largely notable for its absence over the last couple of months.
That will change if discussions at two properties in the Golden Mile bear fruit.
We understand that negotiations are continuing at 34 Dawson Avenue with a buyer having declared interest at very close to $7 million. Nearby, at 13 Chatsworth Avenue, an offer in the published range of $7.8-9 million has been received. Watch this space.
Heading down the Bay …
Sandringham reported the sale of 2 Victoria Street for $1.52 million and 22 Kirkwood Avenue followed on from last weekend’s success at number 17. They realised $1.73 million and $1.885 million respectively.
Black Rock’s 243 Beach Road (on around 1021 sq m) sold at auction for $2,230,000 and in neighbouring Beaumaris, 140 Tramway Parade changed hands at $1.8 million.
With April interrupted by Easter, School Holidays and the Anzac Day long weekend this year, agents are now gearing up for May. By all reports, Bayside stock levels for that month are below expectation and that is not good news for buyers.
We will return on Monday week.
Stay safe over the Easter period.
Damian Taylor
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