“Super Saturday!” cried the touts. “Best day to sell of the year!”

And then, at the top end, just about all we heard were the squelchings of a very wet track. Judged by lack of finishers, the worst weekend of the last 12 months. A few of the good ones did sell and sold well (although even some of those sold post-auction to single bidders, suggesting there’s no great unsatisfied demand). Against that, many others – even potential champions – got nary a glance from the punters.

Have we seen the top? Is Staying Put the new stayer?

Some of the more astute agents appear to think so, encouraging their vendors to sell before or to take the expressions-of-interest route rather than risk a public belting.

Then … why? What turned Super Saturday into Super Flop?

Same old, same old. Still too many vendors who are ahead of the market, still too much over-promising to vendors and underquoting to buyers, creating a gulf between the expectations of both which can’t often be bridged at an auction.

Add to that the great incentive agents have to “buy” listings by promising the impossible to vendors: primarily it’s a device to lure the unwary at open-for-inspections and, in turn, to persuade them to list by offering equally impossible promises. It’s a chain letter written in other people’s money.

All of which builds the already considerable lack of trust between many buyers, sellers and agents. Yet as Super Saturday may have demonstrated, the foundations are starting to shake: those gullible players (the agents’ much-derided “wood ducks”) just aren’t as common any more.

(While on that subject, while less common, they’re not extinct. Some people should not be allowed out with a cheque book; including one excited soul who on Saturday got into a bidding war with … the vendor! Bid after bid. Open season.)

The weekend’s surprise? Ex-pats.

Just when we thought the mighty Oz Dollar had scared all overseas interest off-shore, there they were. More than a few ex-pats looking to bring their families home in January (we have this on great authority, we talk to people) and looking hard where the good schools are – which may help explain the continuing strength of Hawthorn, Kew and Canterbury when even traditional AAA addresses are faltering.

Weekend woes:

• Toorak, bids as rare as winning tickets in Willy Wonka’s golden casket. Properties mostly passed in on vendor bids with mountains of marketing money spent for no result
• Armadale. Ouch. No interest, even in two good properties on offer: 60 Adelaide Street and 54 Union Street
• Malvern. Whoops. Even in ever-popular Claremont Avenue, 115 failed, right next to the school.

Then came Canterbury, Hawthorn and Kew with some surprisingly solid results. At times three and four hands in the air resulting in sales at time hundreds of thousands over the reserves.

Need an e.g. of what a good property can do in even an unsure market? Point your cursor at 29 Wellington Street, Kew. Much interest, and sold well.

Weather forecast? Not happy camping for agents and vendors. The REIV will as usual insist the sun is still shining, but those who take a look out the window will know better.

DM

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Bayside: What’s in a clearance rate?

The weekend clearance rate of 68% at first glance seems reasonable given the huge volume on offer, but that does not reflect the real mood of the market over Saturday and Sunday; often there was just one bidder and then a negotiation after a pass-in.

Bentleigh was Bayside’s strongest performer: 21 sales from 25 offerings.

5 Delhi Street and 20 Strathmore Street shared top honours at $1.2 million. 10 Yaralla Road – $680,000 – brought up the rear of the field.

Beaumaris and Black Rock managed 5 from 10 with 22 Hardinge Street, Beaumaris selling for $1.455 million post-auction and 10 Fifth Street in Black Rock reaching $1.42 million.

However 36 Second Street, a 10 room house on 947 sq m, failed to ignite and was passed in at $1.45 million against a reserve of $1.6 million.

Hampton and Sandringham were busy with the former taking the accolades with several convincing top end results.

Highest on the day was 25 Bolton Avenue where a modest attic-style house with a North facing rear garden of 962 sq m surprised some: $2.8 million.

The well regarded Margarita Street was a hive of activity: Number 21 was offered as land only – 768 sq m – and sold for $1.815 million. On the Sunday, number 43, a renovated weatherboard house on 743 sq m – on the crest of the hill with Bay views and ticking all the boxes – sold for $2.525m.

In the same pocket of Hampton, 2 Avondale Street sold for $1.49 million while 4 The Avenue was passed in at $1.78 million. There was a later offer of $1.825 million but still some daylight to the reserve of $1.95 million.

Elsternwick was busy for the second week running: 10 auctions, with all but three finding new owners.

Of those still looking, 53 Shoobra Road was passed in on a solitary bid of $1.775 million. The reserve has not been publically disclosed but a prior to auction suggestion of around $2 million clearly spooked buyers and maybe the pass in figure is close to the true worth.

The Brightons originally had 46 auctions scheduled for the weekend. There was always going to be a struggle with that volume.

The first five auctions we attended did not see a real bid including a “Mortgagors” auction at 159 Dendy Street. It was passed in at $1.35 million but has since sold at a hush hush price.

The highest price on the day was 13 Weatherly Grove. Although passed in on a solitary bid of $2.325 million, a buyer was eventually persuaded to part with $2.5 million to clinch the purchase and a fair result all around. The same property was offered in the heady days of late 2007 and was passed in at $2.6 million with an initial reserve of $2.9 million. We understand a genuine offer close to the reserve was knocked back. Ouch

37 Lynch Crescent was sold price undisclosed but smack in the middle of its quoted range of $2-2.2 million

14 Bent Street sold, price undisclosed. (OK, a hair under $2 million.)

One of the handful of properties to attract multiple bidders, 12 Hamilton Street saw three hands up and its quoted range of $1.55-1.75 million was always under threat following an opening bid of $1.725 million. It finally sold for $1.815 million.

Other runners?

• 85 Cole Street sold for $1,550,000
• 26 Murphy Street sold for $1,600,000
• 32 Asling Street sold for $1,622,500
• 124 Cochrane Street sold for $1,670,000

And then, still in the field:

• 34 Head Street passed in at $2.65 million. There was a later offer of $2.7 million and at least two bidders circling. Reserve is undisclosed but thought to be around $2.8 million.
• 8 Kent Avenue passed in at $2.5 million with just one bidder and a reserve of $2.725 million.
• 14 St Andrews Street passed in on a vendor bid of $1.95 million (followed by a real $1.5 million which was graciously declined. Reserve is $2.1 million.
• 10 Cairnes Crescent passed in on a vendor bid of $1.95 million with a real offer of $2 million refused. Its reserve is $2.15 million, which is exactly what was offered and refused at a previous auction only a few months ago.

With the Derby Day/ Melbourne Cup “long weekend” coming up next, there will be few auctions with many agents focussed on clearing the backlog from last week before commencing marketing for their late November and early December auctions.

The market to really watch over the next month or so is the very top end of town with a number of multi million properties being marketed in Expression of Interest campaigns.

The feeling is that buyers with over $5 million to spend are a rare breed and it will take something very special to get them to part with their hard earned.

DT

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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.

DM

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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:

• 53 Haydens Road sold for $1.4 million.
• 1/26 Bayview Crescent passed in with no bids recorded. Its reserve is $1.825 million
• 1 St Andrews Court passed in on a vendor of $1.6 million. Its reserve is a big fat secret (why?).

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.

DT

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… we wonder where the dummies is (see below).

Lots of promised activity and lots of doors suddenly opening for inspection. Much agent effort going into getting the spring buzz back but, post-football, it’s not really on again for another couple of weeks.

Yes, there has been some private sale activity, and there’s now much more on offer, but at the top end there’s still not a lot you’d want to move into.

Issues? Same old, same old:

• prices – vendors who need to come back to earth, down where the market is
• quality – it’s not there for many of the asked prices, they’re just not AAA – 95% of those we saw over the weekend didn’t have what it takes

And then came the dollar. And it came and came and came. And while it came, some buyers went. There’s one $10 million + property we have been negotiating since the dollar was at 81¢. Now the AUD is nudging parity with the US$, that transaction has become unworkable. As expat and overseas (mostly Asian) interest wanes, you may see some further softening in the top end market. A volatile currency is nobody’s friend – unless you’re a trader.

And along with the flowers that bloom in the Spring comes a new crop of dummy bidders. Why are they blossoming? To quote one agent: “They’re doing it, so I must.” And another: “Tell me, who has been caught?” Well, we know of one, because we pinged him. We have issued a formal complaint to the Minister and Consumer Affairs Victoria. There’s an election coming on – so they might want to be seen to be doing something.

And, in the meantime, if you are bidding, make sure you’re up against someone who is genuinely interested in the property and not a stooge who is only there to raid your pocket – sometimes to the tune of six figures. Need clues? Go here.

The market is as varied as the wind in Spring. October 23 will be big – big enough to tell which way the wind is really blowing.

DM

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Bayside waits, ‘bates breath

The first two weekends of the Spring market have barely whetted buyers’ apetitites for the main courses due on the 23rd and 24th of this month – average attendances and thinning bidders resulted in overall clearance rates dipping to 68% across Melbourne and to an even more modest 61% in Bayside.

Unless a property is an absolute standout, buyers are proceeding with care, only coming to the party when a property is priced realistically and meets their exact criteria.

Yet even months after market sentiment changed, too many sellers’ expectations are still above the market; frustrating buyers who want to transact but at current value levels, not at those of the peak back in March.

Some of the more significant Black Rock results over the past week:

• 365 Beach Road, on 840 sq m, sold for $2.7 million
• 43 Bluff Road, 1065 sq m, sold for $1.993 million
• 14 Middleton Street, on a tiny 318 sq m, sold for $1.78 million
• 290 Beach Road passed in on a vendor bid of $2.1 million. Reserve is $2.3 million.

Overall a busy day in this relatively small beachside locale.

The highlight in Hampton was the auction of a period timber house on 976 sq m at the beach end of Linacre Road. Number 6 was knocked down at a respectable $2.35 million – with 6 bedrooms, 4 bathrooms, glamour pool and some Bay views, nothing less than expected.

Bentleigh performed with its usual aplomb even though several pass-ins were recorded and it is obvious that the number of privately sold properties is starting to creep up.

The highest sale for the week was private: 3-5 Buckingham Avenue. A contemporary near-new house on a generous allotment of 1175 sq m, it sold for $1.675 million.

Brighton was ho hum: a clearance rate under 50 % as a result of some fairly uninspiring offerings.

However a spirited auction took place at 45 Orchard Street for a little 1930′s brick bungalow on 501 sq m. The initial quote of $1.18-1.3 million guaranteed lots of interest and at least four bidders quickly bid up to $1.4 million before it was knocked down a mere 5 minutes later. It paid to be on time.

Number 10 Campbell Street finally been sold many weeks post-auction for $3.9 million and 34 Foote Street sold privately for $2.06 million after being quoted at $2.1-2.2 million.

A significant off-market sale has been negotiated at 9 Black Street, Brighton. A substantial single-level Victorian on 1100 sq m, its price is believed to be around $4.25 million.

The very pointy end of the market will again be tested with the official listing of a beachfront property at 1 Bay Street. An old Brighton mansion on 2200 sq m with a permit for 7 apartments, if it reaches its anticipated ticket of $15 million plus, it will take the record as Brighton’s highest price paid.

DT

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