Now is the winter of … exceptions.

Morrell and Koren, the 1st buyer's advocates

This much you know: the market is soft, its top end especially so. Many listings, few must-haves. And plenty of those less than exceptional houses which a year ago would have had crowds queuing today can’t attract a stray cat – any bets on how long it will be before the offers of free coffee and cake re-emerge?

And, in any direction you look, there are more and more explanations being laid on the table: it’s the uncertain economy, it’s the banks, it’s the bubble, it’s the weather, it’s the footy (always), it’s the…

[pullquote]The explanations from the pundits are near-always certain, near-always neat.”[/pullquote]The explanations from the pundits are near-always certain, near-always neat. But out here where the deals are done, the world is a messier place.

That’s where the exceptions rule: the AAA’s with all boxes ticked; especially if renovated and ready to move straight in – the exceptional properties which make their own rules.

20 Gordon Street, Toorak. On the market at $2.5 million and many hands took it lightly to $2.925 million. Exceptional.

And then came Armadale and exceptional turned to weird. High-profile property offered by two high-profile agents in conjunction. A huge ad spend which came up with a great big expression of little interest. And then it sold. Over $8 million. Agent? Well … not one of the high-profiles in conjunction. The commission on a sale at that level is likely to be around $160,000+ so it’s not exactly kitty litter. But whose commission? The agents who didn’t or the agents who did? Those who made the sale or those who have the contract to sell? Lawyers at close range, anyone?

So what can you expect?

  • AAA choice will continue to be narrow. That’s certain.
  • The long weekend will be an interruption.  That’s certain.
  • School holidays will be an interruption. That’s certain.
  • Some who think they know better will ignore the forecasts and list anyway. That’s certain.
  • Some who have no choice will list because they must. That’s certain.
  • Some will still find hidden treasures. That’s certain.

And there will also be exceptions.

David Morrell

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Bayside relativity principles

The published results suggest that Bayside performed relatively well on the weekend. It’s only when you drill down that it becomes apparent all is not as it seems. Those which sold often attracted nary a bidder and were only saved from joining the PI list in drawn-out post-auction negotiations.

12 sales from 18 auctions over the weekend in the Brightons, for example, suggest it’s quite a solid market but in fact it’s skating on thin ice over waters of unknown depth.

[pullquote]…trying to pick the bottom of any market is a daunting task.”[/pullquote]With a soft market and winter approaching it’s understandable that many would-be buyers feel the bottom is yet to be reached; but it’s also true that trying to pick the bottom of any market is a daunting task and when lifestyle is involved, price should not be the final decider – that the investment component of a well-chosen house will, given enough time, look after itself.

Brighton gets busy

The very pointy end of the market in Bayside has been notoriously quiet this year with sales over $5 million virtually non existent, so the sale of a landmark Victorian house on 2790 sq m at 70 Halifax Street, Brighton is worthy of note. It’s been on and off the market at various times and with different agents over the past couple of years and finally sold during the week for a figure believed to be between $7 million and $7.5 million. Although a far cry from the $9 million plus quoted when first offered to us in 2008, that price is a positive for a property of this calibre, particularly given the less than prime location at this end of Halifax Street.

Those which sold at auction?

Those which didn‘t?

  • 39 Orchard Street. Nary a hand raised for a fine single-level renovated Victorian. Passed in at $1,950,000, reserve $2,090,000.
  • 5 Tracey Crescent. Again no bids nor bidders. Passed in at $1,750,000 with a hopeful $1,950,000 reserve.

And just as the demise of the entertaining Saturday arvo auction draws nigh, along comes the most engaging street theatre we have witnessed for some time.

126 Bay Street is an unusual property – a period-style double-storey residentially zoned shop in a group of four; but nowhere near Bay Street’s commercial and retail centre. Before the auctioneer could call for bids, a heated discussion ensued between the auctioneer and an increasingly angry questioner regarding flood zones. At the end of the day he with the loudest voice always wins and with the assistance of his portable amplifier (“Never argue with a man with a microphone.” – J Kennett), the auctioneer prevailed. That seemed to fire up the crowd and half a dozen bidders competed, pushing the final sale price to $855,000, $100,000 over the reserve. And no, Mr. Angry did not bid.

Bentleigh fired up as usual with 15 sales from 21 auctions and with three sales above $1 million, Bentleigh’s top end seems near-impregnable.

  • The highest price paid was for a well renovated and extended timber cal bung at 4 McLean Avenue. On a modest 557 sq m, it has a designer pool and all the other accessories deemed necessary. It sold for $1,590,000.
  • Also up there was the sale under the hammer of 12 Godfrey Street. Although not in the same league as McLean Avenue, it still attracted competitive bidding from two keen parties and sold at $1,370,000; just over its reserve of $1,350,000. It was earlier quoted at up to a quarter of a million dollars below that reserve and prospective buyers dragged along by false hopes are justifiably furious.

Black Rock and Beaumaris? RDO

Sandringham and Hampton? 7 out of 10

17 Avondale St Hampton, good location, a typical example of a nicely renovated and extended brick period house, passed in at $2,300,000 and later sold for what is thought to be around $2,400,000.

Elwood flies

Two sales in Elwood support our observation that there is a continuing flight to quality.

  • A townhouse at 89 Mitford Street sold for $1,737,000 at auction
  • A lavish Nick Wright house at 20a Docker Street did not make it to the day and was snapped up in the first week of its campaign for a cool $2.5 million.

With a huge weekend coming up next week, most Bayside agents will be relieved they have cleared a good percentage this week. We predict this will not be the case come next Sunday night.

Damian Taylor

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Soft is pundits’ new hard-sell

They need the turnover,” says buyer advocate David Morrell. Australia
escaped the worst of the global financial crisis, but some investors have
given up on … Sydney Morning Herald

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