A bunch of years ago, Bob Dylan wrote “The Times, They Are A Changin”. He could have been singing of now; as we write, banks are going “Whoops”, Governments are going “Oh bother”, car dealers are saying “Where is everyone?”, shops, travel agents and hotels are all loitering like barristers without briefs and we still live in the Lucky Country.
Still true? Are opportunities still out there?
Last weekend was as quiet as a librarians’ convention, but the real estate market ploughed on. No choice. But all gloom?
As one agent pointed out, clearance rates might be down to 62%, but that still means that 62% of the houses that have come on to the market are selling over a short period of time. There’s still some movement at the station.
And there are opportunities. Even with stock levels down by 40%, prices are still faltering. Often by 10-20%
AAA real estate still commands respect, so it’s worth keeping an eye on 12 Huntingfield Road, Toorak for a trend it may illustrate. It’s on one of the best streets in Toorak, a 2-storey 1940’s brick family house on 10,500 square feet.
The comparison will be with the recently sold 23 Irving Road, Toorak, just around the corner; a similar house on 9,200 square feet which sold for over $4.9 million and had bids from at least six parties.
What difference will six weeks make?
Watch, also, family houses in the $1-2 million bracket. This is rapidly emerging as one of the softer segments of the market. If this is where you are looking, your opportunities may be a’changin’.
OK. It’s no longer “Hey, Big Spender.” But this week’s lyric may yet turn out to be “Hang On, Help Is On Its Way.”
Bayside. A history of opportunity’s windows?
What do you make of the events of the past three weeks: foreign banks falling over, others being rescued, international equities markets savaged, the ASX All Ords falling off a cliff , local interest rates slashed and our Prime Minister hastily moving to guarantee bank deposits and inter-bank lending?
What do you do in the face of daily gloom and doom news?
Choke on your Weeties, cancel the papers, kill the telly and quake in the corner?
Or dive into recent history books and reflect on the fall-out of the 1987 stock market crash ? when equities fell 47% over a two month period.
Property became the subject of people’s attention. Investors and owner occupiers headed for bricks and mortar and demand drove prices up.
That was a bubble which took three years to burst in a climate of double digit inflation and 18% interest rates; but the fundamentals are now vastly different. Interest rates are declining and inflation is a much more manageable 3.5%.
Some other key drivers relating to Melbourne are its sustained population growth and the under-supply of new housing stock. Rental yields have recovered in recent times and can make property doubly attractive for investors.
The contraction in owner-occupier property prices in 2008 has assisted first home buyers and made it easier for those already in the market to upgrade.
A possible lesson in all this? A window of opportunity for buyers to get in on the ground floor may be creaking open. If so, history says it will not be open forever. Whether it is for three months or six months is hard to call, but don’t wait for the bell to ring because you may not hear it.
This weekend’s official auction clearance rate was a sombre 62%, down from the previous week’s 68% but, given the circumstances, this was expected.
Volumes are down markedly on the same time last year and that’s a trend which looks set to continue.
Brighton’s auction output was as mediocre as its results.
4 Bryson Avenue, a well presented 8 room clinker brick family house on 600 sq m within a train’s whistle of Middle Brighton station and the Church Street shops was taken by two bidders to $1,840,000 and then sold immediately after for $1,856,000.
72a Wilson Street, one of two town houses on the block, did not raise a sweat. A vendor bid of $1.575 million being the only bid. Its reserve is $1.625 million.
37 Codrington Street, Sandringham, an eight room timber house on 768 sq m realised $1.55 million in an otherwise quiet day by the Bay.
On a brighter note, 33 Drake Street, Brighton was sold by private sale last week for $4.4 million, a strong result for a new Nicholas Day designed house with a substantial basement, an excellent floor plan and a high level of fitting and finishes on about 720 sq m.
Another notable result was the sale off the plan of a French chateau inspired townhouse, one of six, at 15-17 Bent Street, Brighton for $2.75 million. This sale will breathe new life into this sometimes forgotten street between Male and Hampton Streets.
The top end in Brighton will be well and truly tested in the weeks to come with 25 Cosham Street (anticipating $5 million plus), 23 Sussex Street (at least mid $4 million), 11 Gould Street ($3.5-4 million plus and 5 Leslie Grove ($8-10 million).
All quality properties and well worth inspecting.