Not one market. Many. Where you are buying/selling, and when, all count. Now more than at any other time of the year; and more so this year than most.

Some bites:

Traction. Some.

Surprise! Sales are being made at the top. More often than not, post expression-of-interest and, for the few remaining supreme optimists, post-auction. What are the odds?

Around 50% chance of selling if you’re going to auction (but pick your agent carefully, some are kicking goals, others are finding the boundary) — and if you are going to auction you have around a 50% chance of attracting multiple bidders, 50% of not seeing a single bid and a 50/50 chance you’ll still be living in hope in the new year.

One to watch: 19 Haverbrack Avenue, Malvern. A Dec 17 auction suggests the owners have already bought elsewhere and the urge to sell will be a factor. And it will test our belief that taking anything over $5 million to auction in these uncertain times can be an uncertainty too far.

Section 27 says we’re living like SYD

The conventional wisdom is that top end MEL is not like SYD. That the harbour-viewers are geared to their we’ll-borrow-all-we-can eyeballs and when the equity markets sneeze a great chill blows in from the heads — while MEL is conservative, rational, old-school and immune to temptations such as mortgages.

Guess what. We’re not. A significant number of the Section 27 Vendors’ Statements we’ve been hearing about indicate some very aggressive gearing. Would this help explain the late run of properties trying to find buyers so close to Christmas?

Not all. Certainly not two couples who, last week, each found over $5 million for apartments in Walsh Street

 Under $3 million? What does the Council say? 

Those houses under $3 million which tick all the boxes are still attracting the interest of numbers of potential buyers. The rest are struggling. Many, as we’ve noted before, are going for less than council valuation — and councils aren’t famous for getting ahead of the market (nor are ratepayers famous for accepting valuations which are higher than rock-bottom).

So, yes, there are bargains but you still have to ask yourself whether you can live long-term with any compromises you may have to make.

Too early to talk about holidays?

The real market is post-Christmas, but it’s around now that we start receiving enquiries about what’s what on the coasts and country — but then it was only last weekend that we bought several holiday houses on behalf of clients. The good news (for them): there was little competition.

There will be one serious pre-Christmas top end test: 3509 Frankston-Flinders Road. It’s an expressions-of-interest exercise chasing $10 million and should provide a signpost for eight-figure post-Christmas activity.

While out of town, what’s been happening in Mount Macedon over the last couple of weeks? Why is everyone wanting to sell?

Broken records

58 Howitt Road, Caulfield North. Around $6 million topped anything sold in the area. Ever.

1 Towers Road, Toorak. Not a record. Yet. A cutting-edge test of whether vendor expectations and market reality have a great deal in common. A few square feet shy of an acre in one of Toorak’s pricier slices. Just may be the highest price ever paid for a bed in Melbourne. Its sale via expressions-of-interest climaxes (or not) tomorrow.

Going once, going …

Auctions without end, when the auctioneer just doesn’t know it’s all over. When “Last call!” leads only to “I’ll just go inside and see what the vendor thinks.” — after the property has already been announced as being on the market.

It’s grubby. It should go not once or twice, but forever.

David Morrell

Bayside: lost weekend in Brighton

A week can be a long time in real estate.

A week ago there was something that looked like a light at the end of Brighton’s tunnel. It turned out to be a couple of kids playing with matches.

Last weekend Brighton’s very own Super Saturday — 31 auctions — proved to be as wet as the weather. Yes, 16 sold, but five of those were sold-priors so Saturday’s sold-at-auction result was in fact just 35%.

The sold-befores tell their own stories: One buyer, one reasonable offer, one agent prepared to advise that the first offer is often the best and no more so than in this market. You’ve seen the alternative: 35% — and those which did sell under the hammer were well under the median prices usually seen in these parts.

So. What went before?

• 4B Lorac Avenue, Brighton. $2,425,000
• 8 Orchard Street, Brighton. $1,730,000
• 5 Binnie Street, Brighton East. $1,950,000

What didn’t go at all?

• 20 Cole Street passed in on a $4,000,000 vendor bid, reserve a secret.
• 1 Martin Street passed in at $3,500,000, a later offer of $4 million, and vendors with 5′s in their eyes. Could be a very long wait.
• 2 Collins Street passed in at $2,975,000. Later offer $3,050,000. Reserve an approachable $3.3 million. Will sell.
• 24 Victoria Street passed in at $2,625,000. reserve $2.8 million. As land only, that’s a generous $2900/sq m ($273/sq ft). Are we missing something?
• 13 Holmhurst Court passed in at $2,000,000 with another $200,000 offered later. Reserve is $2,400,000.
• 375 St Kilda Street passed in on a $1,700,000 vendor bid. Reserve is $1,850,000

And a lot more of the same. But we don’t want to be seen as depressing the market.

And then came …

Hampton and Sandringham. Silence. Not golden.

More silence? 7 Linacre Road, Hampton. An expressions of interest campaign which closed last Monday. Nothing heard. Too much to ask for some transparency in the result?

Beaumaris and Black Rock. Hardly a peep.

The Bentleighs. Return from oblivion. 18 offered, 12 sold — but nothing over $1 million. “The pointy end has been well and truly blunted.”

Three weeks. All that’s left before the shop shut signs appear. A late rally looks a lot less than likely and with the number of recently-listed properties likely to remain on agents’ books into the new year, buyers could do well to wait for the January sales.

Damian Taylor

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Greetings, sports fans. Big weekend was had by all. Winners and losers, hard-hitters and duffers out in force while a squillion spectators had a ball.

Not golf: real sport. Real estate.

The winners were clear by about the third hole: buyers, no handicap.

There were even comedy acts for the children. One, supposedly a professional, opens the bidding at a shade under $2 million. Instant vendor bid (typical of this agent) raises that by $10,000. The professional bids again, adding … $90,000! A knockout bid! Against … who? Themselves? Can this really be happening? It gets worse. Post-auction negotiations put another $30,000 of the client’s money on the table before this comedy is over. We’re still shaking our heads.

When around 10 properties over $3 million are being passed in for the couple which sell, post pass-in is the time to play. Over just the past week we have bought a number of properties for more than $100,000 under their pass-in figures (one, notably, for $500,000 below an offer made last year).

Do the homework. It’s high-risk, but when you’re sure you are the only bidder, pick up the phone: “We won’t be at the auction. Call us after it’s passed in and we’ll talk.” – helps take the air out of some tyres.

More fun: agents re-labelling B & C properties which have failed in the hands of other agents and packaging them afresh. Same old product inside. Who do they think they’re kidding?

Off-market and out of the limelight there are some gems glinting in the dark. It’s Christmas!

And so to golf:

A Shark’s good walk was ruined over the weekend. Someone called Tiger did quite well.

David Morrell

Bayside: Nothing but the facts

Inspired by Joe Friday (‘Dragnet’, if you’re old enough to remember), “…just the facts, ma’am”.

Recent weeks. Bayside tables turn: Brightons up, Bentleighs down.

Brightons: 16 auctions, 11 sell (but a lot of rain fell on those over $2 million).

East of Thomas Street? Wheels fall off. Two sold from 15 offered. One rate cut was not enough.

Meanwhile, back in 3186:

• 7 Rothesay Avenue. Stumbled past $2 million to sell at $2,050,000. Highest on the day.
• 14a Downes Avenue. New townhouse. Comes close to $2 million.
• 366 St Kilda Street. corner of Elwood. Another townhouse. Gone for $1,760,000
• 4 Gray Street. Land (680 sq m) value. Gone for $1,500,000
• 43a Carpenter Street. Gone. $1,107,500

Higher up the scale, the weather changed. All passed in:

• 2 Snooks Court. $3,000,000 vendor bid, reserve a secret
• 27 Chelsea Street. $2,600,000 vendor bid, reserve another secret
• 28 Collins Street. $2,200,000 vendor bid, reserve not a secret: $2,350,000
• 58 Champion Street. $1,400,000 vendor bid, later offer $1,500,000 reserve $1,680,000

Hampton and Sandringham: 10 auctions. 5 sold.

• 17 Imbross Street. $1,495,000. Highest on the day.
• 21 Grange Road. $1,332,000. Sold.
• 10 Mills Street. $1,325,000. Sold.
• 15 Sims Street. Still waiting at the altar. Vendor bid: $2,000,000. Reserve: $2,100,000.

The Beaumaris/Black Rock malaise (do they still hold auctions there?) seems to have infected the Bentleigh twins. No nurse in sight.

Tough week for some. And more to come.

Damian Taylor

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“I’d sell, but no-one is buying…”

“I’d buy, but no-one is selling…”

“Did you see what the place down the street went for?”

“Really? It did?”

And so the dominos begin to fall.

Over the past several weeks we’ve seen more action than we have seen all year. Not enough to say the market is back on the way up but, at least at the top end, sellers are reappearing and there are buyers waiting to meet them.

Meet them at the right price, that is. The usual pre-Christmas desperation among buyers is less in evidence. Most have done their homework, know how much to pay and won’t be panicked. While we’re a little surprised at how many offers have been taken up – we had anticipated more slack, more people sitting and waiting – in most cases there is still only one buyer in negotiation and so the conversation is all about price.

It’s the vendors who are anxious. The post-Christmas hiatus looms. Sell now or chances are the summer will be over before you’ll see your name on a cheque.

Yet still the games are played. The lemons listed as diamonds (and priced accordingly) in the hope that the fool and the money will soon be parted.

There are also agents – at the top end one in particular – who are all over the shop; including promising some clients the earth to gain listings and then delivering little more than apologies.

The top end is a very small world and we’ve seen all this before. Word gets around. Over-promising agents may not get it, but it’s their own futures they’re putting on the line.

Other career-limiting tactics?

• The auctioneer who belittled an old and valued (and extremely valuable) client over the weekend. Expect that agency to be overlooked in future transactions.
• Auctioneers who draw out auctions for no more than the joy of hearing their own voices. All over in five or ten minutes is no longer enough. Going once twice and thrice is only a prelude to all finished all done and it’s still not over. They promise an end and then leave the highest bidder gasping while they start all over again. Sold is sold, gents. Don’t be surprised if you start seeing those highest bidders walking when you’re treating them like idiots.

Dominos that fell?

• 47 Kinkora Road, Hawthorn. $5,660,000.
• 48 Mathoura Road, Toorak. $5,220,000.

Two sold by auction at over five million. We haven’t seen that for a while. But both were hen’s-teeth 2-storey Victorians; and big period houses are rarely kept waiting.

David Morrell

Bayside: Not a lot of room at the top

With the exception of Beaumaris and Black Rock, Bayside was generally steady over the past week – reasonable auction activity and a handful of private sales.

That said, most of the action is in the lower and mid-ranges. Activity at the top end is relatively sparse. With more on offer, the next few weeks will be severely testing at the top end but if the weekend before last is a guide, there will be interest if prices are sensible.

Big if.

Judging by two significant properties we have seen over the past week, there are still vendors who are living in outdated dreams. $1 to $2 million out of date by our reckoning.

Blame the vendors? Yes. Blame ambitious agents who have been buying listings? Them too.

It’s hard to see any sense in testing the market in the current climate. If you want to sell, price correctly and negotiate sensibly with buyers – they’ve done their research, they know how much the market will bear (even, dare we say it, they know that with greater authority than some agents).

The weekend?

The Brightons did reasonably well: 13 auctions, of which nine sold; mostly in The East.

• 54 Shasta Avenue sold for $1,655,000. Big block – 1178 sq m – working out at a somewhat modest $1,400/sq m or $130/ft.
• 11 Sunlight Crescent passed in to a vendor bid of $2.5 million followed by an offer of $2.62 million. Reserve? Undisclosed.
• 18 Connor Street passed in to a vendor bid of $1.95 million. There was a later offer of $2.025 million. Reserve is $2.175 million.

In Brighton itself, 23 Norwood Avenue failed to excite and was passed in on the auctioneer’s $1.95 million bid. The reserve is $2.2 million.

Hampton and Sandringham were busier: 12 auctions between them with just over half selling.

With a number of these results being reported as undisclosed, it is a reasonable assumption that someone was not excited about the price received.

The Bentleighs bounced back with a full book of 20 odd auctions being scheduled and a total of 13 clearances. Again the upper end struggled with both million dollar plus offerings falling short.

• 16 Coates Street was passed in on a $1.25 million vendor bid, reserve is undisclosed
• 188 Centre Road passed in on a $1.1 million vendor bid with a later offer undercutting that (and why not?) at $1.075 million. The reserve is $1.175 million.

As mentioned at the outset, Beaumaris and Black Rock underperformed. Just two sold in eight auctions. Not sure what is in the water down there, but for now it can’t be the favourite tipple of the local estate agents.

Damian Taylor

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It seems there’s been a conspiracy among the boardroom auctioneers over the past couple of weeks: don’t let anyone get home in time for dinner.

Surprise, surprise: there’s been some action. Horses have left stables, the tennis set has its whites on.

15 Chastleton Avenue, Toorak, with four bidders, bolted: $300,000 above reserve (and was still a sensible price).

Three tennis courts with houses attached popped up in Linlithgow Road.

And some rank outsiders also bolted home. The recent construction at 33 Coppin Road, Hawthorn for over $8 million? Given what the site cost not all that long ago, we couldn’t make it work on our calculator.

And while Spring is yet to trouble a number with eight figures, that may still change if a vendor or two comes back to earth. There’s interest, we’ve seen it, but not in the stratosphere.

And then there are the agents. The question we are most often asked after “How much?” is “Who should I be dealing with?”

Our view:

1. Kay & Burton. They know a deal has to work for both sides.
2. RT Edgar. Had fun in court, but now being busy clearing a backlog that’s been around since Mr Malthouse was Collingwood’s only coach.
3. Marshall White. Don’t ask.

And now Edward de Bono is coming to town and agents are lining up to learn about the latest thing in thinking (a new experience for some). Will he suggest that auctions aren’t the way of the future? That EOI’s and private sales have passed their best before dates? Will he tell them about something called the internet? Will they wonder why they’re not attending a webinar instead of having to put Dr de B to the inconvenience of attending in person?

David Morrell

Brighton booms, Bentleighs bust (briefly).

18 auctions in Brighton. Testing times. And … wait for it … 10 sold! Three out of three in the Golden Mile; although prices tended toward the whiter shade of pale (the white of vendors’ complexions, that is).

1. On the beach, 8 Mytton Grove, on Sandown Street beach, overlooking the marina. Just 613 sq m and a similarly modest house, but two bidders whose enthusiasm at times defeated the auctioneer’s arithmatic. Sold, eventually, on the money at $6,050,000.
2. Around the corner at 8 Moule Avenue. Modest house and land (658 sq m) package. Price a suitably modest (even the agent thought so) $2,310,000 – $325/foot.
3. St Minver, 15 Dudley Street. Attractive attic-style house on 1000 sq m. Sold around August last year for a little over $5 million. Saturday’s auction kicked off with the auctioneer offering $4 million. No response. Auctioneer tops himslef and bids $4.4 million. More no response. Passed in, but later sold for, we suspect, not a lot more than the pass-in figure.

Elsewhere around Brighton:

• 6 Byron Street. Close to sold with a post-auction offer of $1,875,000. Declined. Wise?
• 299 New Street. Percy Grainger’s birthplace, but it’s changed somewhat since (the fruit trees have blossomed into up-end apartments, the old house has had a serious makeover). The only music heard was the auctioneer’s $1.7 million. Passed in.
• 190 Church Street. Sold for $3,112,500, somewhat shy of the $3.5 million plus being touted less than 12 months ago.
• 92 Wilson Street. Sold following a successful (for the vendor) EOI campaign. Price believed to be $2,880,000.
• 14 Comer Street, East Brighton. Wrapped up post-auction a couple of weeks ago at a respectable $2,350,000.
•  3/2 Dendy Street. Privately sold for $3 million.

A little further down the Bay, 107 The Crescent, Sandringham, has finally sold for a figure believed to be in the high $2′s.

Hampton and Sandringham had eight auctions with 50% sold. Highest was 7 Francis Street at $1,500,000.

Beaumaris and Black Rock have been flying under the radar in recent times. Auctions a hive of inactivity, but private sales are happening.

The Bentleighs barely raised a pulse on the weekend. Just three sold from 10 on offer, but any more interest rate cuts could quickly change that.

Overall, listings have jumped in the past fortnight – leaving little time to conduct sales campaigns before the Christmas closure. Agents with full books will no doubt be delighted with the appointments and the square centimeters in the media, but may soon despair of their chances of finding buyers for every property.

Genuine sellers with realistic late-2011 expectations will be well met by an emerging pool of buyers now willing to commit – and in fact anxious to buy ahead of the new year. And there will still be those – from both sides of the fence – for whom the time never seems right and who will still be on the merry-go-round come next year.

Damian Taylor

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