Rebecca Thistleton
Auction results for Sydney and Melbourne have delivered the healthiest signs of a market revival in two years.
Clearance rates outperformed 2011 levels for both cities. While Sydney’s market has shown a slow but steady performance throughout 2012, Melbourne’s market has long been in the doldrums since its peak. Both markets are showing signs of firming up, particularly in the multi-million dollar bracket.
“Super Saturday” is regarded as a litmus test for the market because of the high volumes of properties under the hammer. It follows the springtime end of football seasons and school holidays.
Sydney’s clearance rate was up 13 per cent on the same time last year, at 68 per cent compared to 55 per cent in 2011. Last week’s clearance rate was 61 per cent. There were 524 homes scheduled for auction.
There were 1180 homes auctioned in Melbourne during the weekend, up from 742 the weekend earlier and a significant increase from 405 for the same time last year.
The Real Estate Institute of Victoria said Melbourne’s clearance rate was 66 per cent. Top results for Melbourne included a Port Melbourne home which Hocking Sturt sold for $4.1 million. A Kew home sold for $3.92 million and a St Kilda West sold for $3 million.
In Sydney, the most expensive sale was a Northcote Avenue home in Killara for $4.22 million. Selling agent Philip Waller of McGrath had appraised the home in the past and in 2006 valued it at $5 million.
“The buyer could see the value in the property, a similar home sold nearby for about $7 million,’’ he said.
While he and the vendors had hoped for a sale around $4.5 million, the amount quoted during marketing, the auction was an open forum for what the market was willing to pay. “Overall, the market has been better, and even at open for inspections we’re finding there is more confidence,’’ he said. “I’ve had offers of about $4 million and $5 million for homes in the last few days and it has been good to see people coming out and making offers again.”
Melbourne buyers agent Mal James said sellers were getting results if they were pricing their homes in line with the market. “A long drought on good stock meant there were some thirsty buyers out there, ready to snap up the good properties that were on offer on Saturday,’’ he said.
Mr James said demand was particularly strong in the $2 million plus market. In Malvern East, a solid half-hour of bidding ended with a Coppin Street home selling for $3.35 million after a fourth bidder emerged in the final moments of the auction.
“Activity breeds more activity, so we would expect more properties to be coming onto the market over the next few weeks as well as more off-markets,’’ he said.
Scott Banks of Scott Banks Real Estate said there was renewed confidence in the market but buyers were still cautious with many waiting to negotiate post-auction. Such was the case with a Sandringham property he sold on Saturday, designed by Crone Partners, which was passed in at $2.1 million but later sold for $2.4 million.
Michael Gibson of Kay & Burton said a Pasley Street South Yarra property sold for $1.94 million to after post-auction negotiations.
“There is a lot of that happening, but there are certainly a lot of happy vendors around after the weekend.”
Buyers advocate Christopher Koren said that while there was much talk around super Saturday, sentiment was positive in the “off-market market” for top-end properties sold purely through negotiations rather than marketing and auctions.
In the past 10 months, about $350 million worth of property has changed hands off-market in Victoria.
“Back in 2006, especially around Toorak, a premium auction was an event, all that was missing was the CWA tea trolley out the front. But people don’t want to do that, they don’t want 400 people through their house when they’re aiming for one person to buy it.”
He said the houses he dealt with 15 years ago were 90 per cent auctioned and 10 per cent off-market, these days about 20 per cent were managed off-market.
“There is talk of a few properties worth around $25 million which will be coming on to the market for sale, but of course they will transact off market as there is such a small number of people who could actually afford to buy in that bracket,’’ he said.
The Australian Financial Review
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