The portents suggested a quiet weekend: the Anzac Day holiday, few upper-end auctions (and none at the top) and a chill-factor steep enough to keep you huddled in your igloo. Together they promised a big weekend of nothing much.

Yet, down below $3 million it was bidders, bidders everywhere and hardly a hammer to drop. Houses open for inspection often had queues. One in Armadale offered a fair imitation of a King Street nightclub on a hot night: they had so many inside, the rest had to be held out.

Can bouncers be far behind?

There are, as we suggested last week, more buyers than properties to be bought, and economics 101 suggests that will prop up any market, but a question remains:

Why here, now, when the same rule seems to have no clout in the other capitals?

Perth? Closed for the duration. Brisbane? Not a white shoe in sight. Sydney? All hype, no action (OK, it’s Sydney, but …).

Yet Melbourne, with the exception of a few Cindarellas still waiting for their coaches (hello, Albert Park, are you still there?), chugs along.

Then what are the agents saying?

“Um.” “Err.” “Us?”

Before Easter they were predicting a post-Easter flood. Now they’re reduced to ?Hello, will you please sell your property as I have nothing else to sell and the school fees are due.”

That’ll work.

There are a few who are quietly succeeding off-market, but it’s still a trickle.

Enough. The weekend:

The top sale was 49 Mathoura Road, Toorak a two-storey Victorian in need of substantial renovations. The vendors were developers who knocked back an offer of $3.7 million last year and last weekend took $3.1 million. Given that the house needs another $1.5 million and $5 million plus for Mathoura Road is now at the upper end of believable, it seems the sums did not add up. Better the trim than the haircut.

8 Stodart Street, Camberwell a vacant block of over 1,000 sq metres, had four bidders and sold for $1,512,000 against a $1,400,000 reserve.

Even toward (shudder!) the bottom end, in groovy Elwood, 30 Addison Street one of a pair, had eight bidders. It sold for $1,030,000 against a $880,000 reserve.

Still by the bay, 16 Gurner Street, St Kilda a good family home, sold for where it should have with three bidders and strong bidding after a loud, loud, loud auction (will we ever learn to shut up?).

Next week? There’s a little more on offer, but the listings drought is yet to break. Sales will happen … if vendors are not too greedy.

The long-term crystal ball?

Last week we ran our yearly seminar in Hong Kong. There it’s pessimists ascendant. Compared to the land of Oz, the GFC has drained confidence and incomes in a big way. Time will tell who the realists are.

In the meantime, expect to see the reluctant return of numbers of expats.

DM

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Bayside: Old games die hard.

It doesn?t get much better than this. 3 Butler Street, Brighton a three bedroom 1960?s single-level brick house on 630 sq m in the Orphanage Estate, sold at auction on Sunday. Quoted to buyers at between $900,000 and $990,000, it sold for (are you ready for this?) a mere $1,470,000!

Kids, that’s a blatant underquote of between 50% and 60%. Just when the hype was spreading that agents had finally realised that buyers are not dummies and should not be treated as such, this sort of nonsense comes along. Does anyone have the Office of Fair Trading?s phone number ?

Meanwhile, elsewhere in Bayside, mixed results were the order of the past two weeks, with private sales dominating.

Finally, months after the close of an extensive expression of interest marketing program and Foreign Investment Review Board approval, 49 South Road, Brighton sold. Our mail is that a mainland Chinese buyer paid in the vicinity of $4.25 million.

27 Foote Street, Brighton sold close to its asking price of $4 million. It’s new, is on 613 sq m and has a basement garage, cinema, gym, 4 to 5 bedrooms and a lap pool.

43 Kinane Street on 1213 sq m with a north/south tennis court, has also been sold following being passed in at auction last November on a vendor bid of $3.3 million. A change of agent yielded a sale at a more than respectable $3.6 million.

26 Kinane Street was passed in earlier this month on a vendor bid of $1.7 million. Its sale at $1,620,000 reflects an impatient seller and a lucky buyer. At land value only, that’s under $1600/sq m or $150/sq ft.  A reasonable expectation would have been around $175-180/sq ft.

223 Church St, a modest 1920?s 3-bedroom house on 620 sq m sold privately for $1.4 million.

Town houses are in demand: 15a Foote Street, Brighton sold for $1.3 million. Around the corner at 62 Cole Street a new townhouse brought $1.72 million.

Older homes on larger than usual land and in need of work are becoming harder to move. 328 St Kilda Street over the road from the Golden Mile, is a gracious but tired Old Brighton Residence (OBR) on 1500 sq m. Last Saturday week it was passed in on the auctioneer?s bid of $1.9 million and is now being touted at ?$2m+?, which could mean $2.01 million or could be $2.5 million or $25 million. Are we confused yet?

66 Were Street on the corner of New Street, another OBR, on 1147 sq m, was passed in at $1.92 million. Its reserve/asking price is apparently a secret. There may be a rationale for making it difficult for buyers, but it’s one which escapes us.

Over South Road and into Hampton (Brighton Beach, if you are selling), 15 Margarita Street ? on 790 sq m with a second street frontage to Gordon Street ? has been sold  for $1.9 million before next week?s scheduled auction. Dare we suggest that if the property had come to auction the buyer would have been lonely? The vendor should be giving a bonus commission on this one.

67 Bay Road, Sandringham sold under the hammer for $1.3 million.

3 Keats Street changed hands privately for $1.657,000

All meaning?

Now, there’s not a lot available, but there can still be strong buyer interest in the right property.

Longer term, winter is apon us but calms, famous for becoming before storms, have also been known to follow in their wake.

DT

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Suddenly it seemed like same time last year.

They grew like mushrooms overnight. Buyers were everywhere.

But … why?

We don’t know for sure, but everywhere we went (and, while not top end, all were good properties) there were between four and eight serious bidders.

Our suspicion is that there was a small horde of people who had not been able to find what they were looking for prior to Easter and had resolved to buy something, somehow, as soon as they could after Easter.

There’s a truism that, once a bidder, twice not shy. Now those people are active, they’re likely to stay active until they have bought.

The top end? Quietly busy. All the real action was off-market or private; with even some of the long-hanging fruit (dare we suggest, including a lemon or three?) at last finding buyers.

14 Myamyn Street, Armadale had been on the market for six months and finally sold for around $3.6 million. Quick history: last year, prior to auction, the vendors were offered $4.1 million and knocked it back. The auction itself went to $4.12 million before the house was passed in. So who’s chortling now?

18 Verdant Avenue, Toorak apparently sold, but not for the $8.5 million they were holding out for. Think nearer to $7 million.

The week’s surprise ending? 172 Kooyong Road, Toorak. Brand new, owner-built. Arithmetic lesson: the land cost about $2.5 million, the building cost is unlikely to have been more than $3.5 million. Sold for just under $8 million. Nice sums if you can get them.

Conclusion? 172 Kooyong is demonstrates again our theory that people are ready to spend almost anything to acquire trophy homes when everything is done and all the buyer has to do is call the removalists.

And what can lack of choice get you?

Mortgagee auction, 29 Coppin Street, Malvern East. A weatherboard in need of serious work on 10,000 square feet. It sold for a whopping $1.77 million against a quote of $1.4 million with seven (!) bidders.

A wider view suggests that there’s still only a handful of properties on offer at the top end and that may encourage some vendors to hit the market prior to June 30. Buyers, clearly, are back, GFC or not.

The stressed sale tsunami we were all expecting (and frankly hoping to take advantage of) seems to only be a ripple at present, but we still have an eye on the weather forecast.

The truly stressed are the agents. It’s becoming feral out there. Lack of turnover and lack of fees is causing some to take the Paris option or a three month sabbatical. Our suspicion is that there will be a lot of mergers and some rationalisation before the end of the financial year when agents are faced with numbers and fees that don?t add up.

Arithmetic. Cruel arithmetic.

DM

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Bayside: Back next week.

The see-saw continues! Gloom at the very top, cheer below that and some signs of life by the bay.

Take a quick glance at the papers and you may conclude – amid all the chest thumping about clearance rates (are you there, REIV?) – that the worst is now behind us.

Try telling that to the dizzy optimists at the top end. Their winter of discontent has arrived early.

How can this be so? How can all those reports be so wrong?

Evidence:

18 Verdant Avenue, Toorak. Brand new state-of-the-art Rob Mills design with the lot. Supposedly Toorak’s best on offer. Expressions of interest closed at 5.00pm on Friday. By 5.30 it was up for private sale at $8.5 million (and still miles above where it should be).

27 Balmerino Avenue, Toorak. Again, no takers. A vendor bid of $2.4 million and a reserve of $2,695,000. No bids at $2.4 million so you can be sure someone will appear with another $300,000? Yes. Right.

68 Hopetoun Road, Toorak. Not a great house and hands remained in pockets, then came a vendor bid of $2.5 million and a reserve of $3,250,000. You can’t get a bid at $2.5 million so you’re holding out for … another $750,000? Could someone call for a reality check?

58A Heyington Place, Toorak. Not a hand raised, then a vendor bid of $2.9 million and eventually the reserve is revealed as $3,250,000. Now all they need is a buyer who will say, “You want me to pay $350,000 more than you couldn’t get anyone else to pay? Sure. Where do I sign?”

South Yarra: 98-100 Park Street. Totally renovated, fully tricked-up 2-storey Victorian. Vendor bid? $4 million. Reserve? Too embarrassed to say?

Deals will be done, because eventually they always must be; but don’t expect to see a buyers’ stampede for cheque books.

Meanwhile, down the scale a little …

There is still strong interest below $1 million; where the lack of choice is producing some results that surprise even eternally optimistic (it’s in their nature) agents.

For example:

28 Cambridge Street, Armadale. Tiny single-fronted Victorian. Cute but very … tiny. Sold for $910,000 and they would have been happy with early $800?s.

And the loopy persists:

32 Mackay Street, Prahran. Pre-auction offer of $960,000, then a supposed boardroom auction to take it higher and suddenly it was back on the market and passed in at $935,000 with five (!) bidders. It eventually sold for $930,000. Those who decided not to accept the pre-auction offer will presumably have great futures as investment advisors.

Next weekend? It’s Easter. Take some time off.

Post-Easter?

The crystal ball has snowflakes around its auction scene. There’s just not enough stock to suggest winter cheer. The real action is, increasingly, off-market. Expect to (not, it’s often private) see more of it.

DM

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Bayside: Sun comes out in Beaumaris

Although not publically reported (why so shy?) 14 Coronet Grove, Beaumaris, sold immediately after an expressions of interest campaign for what we hear is a record price for the suburb. It was expected to realise in the vicinity of $4 million.

Although Beaumaris has struggled with sales in excess the million dollar mark, this sale confirms our recent comments that there is a flight to quality at the Bayside top end. You still need an outstanding wallet when thinking of outstanding properties.

With school holidays and Easter now upon us, and fewer properties on offer, the weekend past was always going to be busy and the much-celebrated auction clearance rate nudged 80%. As we warned last week, auctions are no longer the best guides to the state of the market.

While that point was taken up in detail by one of the weekend newspapers, non-auction or private sales data is still largely ignored in the popular analysis of the market. Increasingly, you’re only hearing – for good or ill – only half the story.

Last week, 534 auction results were recorded. 420 sold and many column inches were devoted to their details in various publications. Meanwhile, over in the other world, 589 private sales barely rated a mention.

And so …

Bentleigh had a very busy week: 16 transactions in total but a surprising six passed in at auction. Early signs of vendors again losing contact with reality?

Brighton also recorded 16 transactions, 50% of them private sales.

11 Wolseley Grove, an older style single-level home on 1039 sq m sold at land value for $2.2 million.

23 Yuille Street sold at auction for $2.215 million in June 2008. Its highest bid on Saturday was $1.875 million and the reserve is $2.1 million. Discussions are no doubt continuing.

26 Kinane Street, a substantial 1022 sq m, also failed to find a new owner. Passed in on a vendor bid of $1.7 million, its reserve is $1.8 million. A question of being on the wrong side of the (railway) tracks?

Brighton East fared better with only one auction falling over: 66 Hodder Street passed in then receiving a later offer of $1.276 million. They’re asking $1.38 million.

8 Walstab Street fared better. A brand new townhouse, it had three bidders before selling under the hammer for $1.59 million.

27 Bright Street, an eight room timber home on only 652 sq m, sold for $1.4 million.

12 Leinster Street, Ormond, a renovated period timber home, sold for a solid $1,110,000
Only two sales were recorded in normally very busy Elwood.

The standout was the auction of 26 Ruskin Street, a block of eight 2-bedroom flats, for a respectable $3,130,000.

See you after Easter …

DT

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