In future we’ll all be living in apartments. You can bet on it, the experts told us.
Last week, thanks to Karl Fender and Nonda Katsalidis, we learnt how that would look.
Big. That’s how. Very, very big.
108 storeys. Hotel. 600 apartments.
Putting aside where the merely well-off will live, moving up the building to where there are four or fewer apartments on each floor and serious money has to change hands does raise a question:
Where will they all come from?
It was a private briefing. We were very polite. The questions were gently raised.
Who is going to buy the 54 apartments at the top?
How many of Melbourne’s multi-millionaires are ready to move in?
The answer, it seems, is it doesn’t matter. Most occupants will be coming from Asia and the developers want the government to ease restrictions to make it so.
Good for the developers. But that does raise another question: If restrictions are eased, you can expect a rush that won’t end at Australia108. A lot of people will prefer to buy closer to the ground and that means many of our better properties will be taken out of the reach of our own landed gentry.
That may well be good news for us (many of our clients are not local), but it’s not good news for those who live here now. And it can turn into another example of politicians and developers falling into one another’s arms while turning their backs on all others.
There are restrictions. If they are to be changed, we should hope for more than a press release announcing that the deal has been done.
Australia108 is not the end of the apartment story. There are new buildings going up on Spring Street and selling at $130,000 a square. There was the recent sale of nine apartments off the plan in South Yarra. And – small building, very exclusive – another nine off-market in South Yarra at prices which would have had their developers drooling even two years ago.
While we argue that land in Toorak is a better long-term investment than an apartment in a building which will depreciate, there are always short-term exceptions.
A recent sale in Mercy (the old hospital) in East Melbourne. Two sales at over $6 million in the refurbished St James.
All of which adds up to a resurgence in the market for top-end apartments and potentially a paradigm-shift in Melbourne property. The – literally – thousands of apartments appearing in inner-city areas will not only change its character and the experience of living here, but the nature of the property market itself. Sheer numbers make that so.
Meanwhile, back on the ground …
Land. The litmus test. Haverbrack Avenue. Last year, north side, $312 sq ft. This year, south side (usually a 15% discount), $360 + sq ft.
4A Mayfield Avenue. Tried last year – one rejected offer. This year, expressions of interest yet to close and we hear there are six or seven parties circling. Could be expensive.
59 St Georges Road. Did not get as far as an expressions of interest. Pool. Court. Gotta have it. Gone. You wouldn’t have expected that six months ago.
If this keeps up, it’s going to start looking like the market has turned.
A Tale of Two Baysides
Bayside has become a tale of two markets; with South Road akin to the DMZ.
The Brightons are bustling and their distant relations on the other side of Nepean Highway from Bentleigh to Ormond to MacKinnon and through to Elsternwick are selling almost everything.
The strip from Hampton to Beaumaris remains brittle. Jump from there to Mentone, Parkdale and Mordialloc and sales are brisk and building.
On current form, this may indicate the buying window is still ajar in the said strip, particularly at lower price points.
Brighton and Brighton East sold over 75% of the twenty one auctioned over the weekend. The highest price paid was at 20 Cole Street in the Golden Mile. On over 970 sq m and a stone’s throw to the water, it has been extensively renovated and a third level has city views. Originally anticipating well over $4 million, it languished on the market for over twelve months and the weekend’s sale price of $3.65 million suggests reasonable buying. Even so, it took the impetus of an auction to provide a reluctant seller with a reality check.
A mid-week auction of a former nursing home at 360-364 New Street achieved the highest price for the week. On 2775 sq m, its Victorian dwellings are well past their suitability as an aged care facility and may be beyond restoration as a home. You’re likely to see apartments or townhouses rising in their place. At least four bidders competed and once the property was declared on the market at $4.9 million renewed competition pushed the eventual sale price to $5.25 million.
Several auctions were not reported, including the outcome of 15 North Road. On 1450 sq m. Pool. Court. A skipped stone’s throw from the shore. Seriously elaborate but not universally appealing. It opened at an auctioneer’s bullish $5 million and was greeted with stony silence. The reserve? State secret.
The lack of information surrounding the reporting of publically conducted auctions was endemic in Brighton this week. One in two results were either sold with price undisclosed, passed in with an undisclosed reserve or not reported at all.
No doubt we’ll get the usual emails from the usual agents defending their vendor’s rights to disclose or not, but buyers and would-be vendors should also have some rights here. If agents and vendors are not prepared to be more up-front, they run the risk of legislators who will take the decision from them.
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