Melbourne Auction Results – May 18th

Coupled with the recent rate cut by the RBA to a 2% cash rate, we are seeing signs of urgency in the market with multiple bidding leading to many reserve prices being smashed.

A clearance rate of 76 per cent was recorded this weekend compared to 80 per cent last weekend and 70 per cent this weekend last year. There were 823 auctions reported to the REIV this weekend, with 629 selling and 194 being passed in, 83 of those on a vendor bid.

There have been over 12,000 auctions held in the year to date, with 77 per cent selling. The suburbs with the highest number of auction sales so far this year are: Reservoir (130 sales), Glen Waverley (118 sales), Richmond (118 sales), Bentleigh East (112 sales), St Kilda (106 sales) and Mount Waverley (104 sales).

Federal Budget A Shot In The Arm This Weekend

After last year’s confidence sapping budget debacle the Abbot government knew they had to take a very different approach if they have any chance to win next year’s election. This week Treasurer Joe Hockey announced the “Have a Go” budget and urged consumers and business owners to spend their way into stimulating the Australian economy. Immediately the Aussie dollar rose to 81cents and JB HiFi and Harvey Norman shares jumped, on the expectation small businesses have 7 weeks to write off any business related items 100%.

Coupled with the recent rate cut by the RBA to a 2% cash rate, we are seeing signs of urgency in the market with multiple bidding leading to many reserve prices being smashed. Jellis Craig reporting 63 from 72 properties sold, an 82 per cent clearance rate. Barry plant cleared 89 per cent, 52 from 56 auctions, adding that a number of properties were also sold privately.

Edward Hobbs from Biggin Scott Richmond said “we cleared 6 from 6 over the weekend, house prices are through the roof at the moment. In a typical Saturday open we are averaging 15 plus groups and at auction 4-5 bidders, which is staggering”. But all is not smooth sailing in the inner city says Mr Hobbs, “despite this strength, the apartment market is saturated and beginning to really struggle”.

Real estate agents in the Ringwood, Croydon and Mooroolbark areas are experiencing a ridiculous surge of activity. David Alvares of Hoskins estate agents has never seen a market like this before, “we are seeing 15-25 offers on some of our private sale properties, it’s just unbelievable what’s happening out here”.

Here are some of the outstanding results Marshall White achieved on Saturday:

• 9 Lansell Crescent, Camberwell – more than $500,000 above reserve
• 209 Tooronga Road, Malvern East – 7 bidders, more than $150,000 above reserve
• 155 Eglinton Street, Kew – more than $170,000 over reserve
• 50 Baird Street, Brighton East – 7 bidders, more than $500,000 over reserve
• 33 Elm Grove, Brighton – 6 bidders, more than $300,000 over reserve

Fellow economic commentator and Brisbane advocate Pete Wargent released some interesting graphs showing the real concerns of rising unemployment in regional areas across Australia. If you are looking to buy an investment in a regional area check the unemployment rate over a period of 5-10 years and the supply of property for sale and capital growth for the same period. How strong is the rental demand for that area and property?

Photo Source: RealEstate.com.au

On The Street

We secured an off market sale for an overseas vendor who engaged our services. Keen to look at all options prior to going on the market, our Paris based owner placed her trust in our services after being recommended. The unit in Melbourne’s South East was tenanted and in need of some updating. We engaged a local agent, after conducting our due diligence and priced the property well above the most recent sale in the block. Within two weeks of the property being on the market we had 8 inspections and 6 contract requests but no offers.

Two more weeks passed and we received a verbal offer, but well below what we thought was fair value for the property. We rejected the offer and in consultation with the owner, pushed the buyers up more than 3 times to achieve a price well above the vendor’s expectations. Our vendor was thrilled with the result and will engage our services next to buy something in Melbourne.

Top 5 Houses

1. 60 Buckingham Drive, Heidelberg $5,200,000
2. 43 Orchard Crescent, Mont Albert North $3,570,000
3. 25 Rushall Crescent, Fitzroy North $3,400,000
4. 1A Woorigoleen Road, Toorak $3,400,000
5. 6 Wills Street, Balwyn $3,160,000

Top 5 Bargain Houses

1. 125 Powell Drive, Hoppers Crossing $277,000
2. 25 The Garlands, Craigieburn $290,000
3. 38 Village Avenue, Taylors Lakes $310,000
4. 39 Rokeby Crescent, Craigieburn $325,000
5. 7 Lombardy Avenue, Dromana $330,000

Top 5 Apartments

1. 5 Olinda Avenue, Beaumaris $2,200,000
2. 3/37 Hartington Street, Kew $1,805,000
3. 5/16-18 Bona Vista Avenue, Surrey Hills $1,405,000
4. 6/103 Lucerne Crescent, Alphington $1,390,000
5. 41B Moylan Street, Bentleigh East $1,386,000

Top 5 Bargain Apartments

1. 9/6 Garnet Street, Brunswick $225,000
2. 7/723 Princes Highway, Springvale $225,000
3. 2/18A Bloomfield Road, Ascot Vale $254,250
4. 1/7 Gascoyne Way, Truganina $295,000
5. 2/465 Princes Highway, Noble Park $300,000

Source: REIV