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    Melbourne auction clearance drops to 54%
    Natalie Puchalski
    June 20, 2011

    THE weekend's auctions produced one of the lowest clearance rates this year, putting pressure on vendors to meet the expectations of cautious buyers.

    After last week's long weekend breather, stock levels in Melbourne's property market were back up, with 639 auctions scheduled, but they generated a clearance of just 54 per cent.

    The same week last year had a much higher clearance of 68 per cent, even with a huge 1050 auctions recorded.

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    Many agents and buyer advocates are attributing this year's lower average clearance to a combination of a lack of quality property, unrealistic vendor expectations and nervous buyers.

    The weekend's auctions were very ''hit and miss'', according to Kim Easterbrook of Elite Buyer Advocates.

    Ms Easterbrook attended the auction of 24 Macgregor Street in Malvern East, which passed in on a vendor bid of $1.3 million, with no bidders, and has a reserve around $1.4 million.

    ''This property had an impressive, period facade, but did not have the best floor plan, which is what held it back.''

    Similarly, 5/1a Lansdowne Road in St Kilda East was quoted between $550,000 and $630,000, and opened on a vendor bid of $550,000.

    According to JPP Buyer Advocate Catherine Cashmore, the property had no further bids and passed in on this figure, much less than its $629,000 reserve.

    On the other hand, 2 Strathmore Street, Bentleigh, attracted three bidders, opening on a ''cheeky'' bid of $600,000 - well below its quote of between $870,000 and $960,000.

    However, after a vendor bid of $870,000, the property eventually sold within the quote for $957,000.

    ''Buyers were in no short supply ? however, only the pick of the crop was getting enough competition to sell under the hammer,'' Ms Cashmore said.

    Craig Stephens from Jas H Stephens said there was ''quite a bit of bargain-hunting going on'' with many buyers approaching after auction to make offers.

    From eight auctions, his agency sold four, including 3 Free Street, Yarraville, which had five bidders and sold for $685,000 - $50,000 above reserve.

    Mr Stephens said the inner west area was ''very interest-rate sensitive'' and he expected buyers' moods to lift if interest rate rises remained on hold over the next few months.

    Lorry Colussi of Stockdale & Leggo in Taylors Lakes said there were fewer buyers in the market overall, although at 212 Burrowye Crescent in Keilor, four bidders pushed the selling price to $583,500.

    Meanwhile, Mal James from James Buyer Advocates said the prestige property market had significantly contracted over the past 12 months, but not because of a lack of demand.

    ''We've got just as many buying clients on our books as we've ever had, but they're not that interested in what's currently out there at the prices that are being asked.''

    As a result, Mr James said, the market was giving ''clear, balanced, long-term messages on the value of most homes, unlike the mixed messages you get in a runaway hot market''.
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