First Mr Fluffy blocks sold under the hammer

The first five Mr Fluffy blocks were hotly contested at a public auction on Tuesday evening, with four of the southside sites selling under the hammer.

Thirty parties registered to bid for the remediated blocks, which are situated in Chapman, Duffy, Pearce and Waramanga. About 120 people attended the auction.

The blocks, which range from 694 to 1059 square metres, sold for between $476,000 and $610,000.

A 1459 square metre block in Chapman was passed in at $660,000.

Minister for planning and land management Mick Gentleman said the first auction was a “significant milestone”, marking the final phase of the government’s response to Mr Fluffy.

“These blocks will be auctioned and rebuilding will then occur, restoring streets and communities as well as defraying some of the significant cost to this program,” Mr Gentleman said.

Mr Gentleman said the government had committed more than $740 million to the Mr Fluffy issue and after the resale of the blocks, the cost to the Canberra community would still be more than $400 million.

“The resale process is the next stage in this response and it is important community and owners understand that there will not be “profit” through the program,” Mr Gentleman said.

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Ray White chief executive Doug O’Mara marketed the first five blocks and he said the agency fielded hundreds of inquiries during the four-week campaign.

The majority of inquiries came from residents hoping to downsize or upsize within their neighbourhood.

“These blocks are a unique product to the Canberra market, enabling purchasers to build in an established suburb, many of which are tightly held areas,” Mr O’Mara said.

“The level of interest we received in the lead up to the auction was strong and we expect similar or even greater interest as more blocks continue to become available.”

1022 homes across 56 established Canberra suburbs have been identified as Mr Fluffy homes and demolitions will take place over the next few years.

The resale phase includes a first right of refusal process, which allows the owner to return and rebuild on their remediated block.

Owners of 690 houses are seeking to rebuild and return to their blocks. The reserve price on each block at auction will not be less than the amount offered to the former owners.

Land Development Agency deputy chief executive Ben Ponton said the first night of auctions demonstrated strong buyer confidence and the result was good news for ACT residents.

“The more we receive over the reserve is less overall cost to the community,” Mr Ponton said.

Mr Gentleman said the resale process was an important step for the blocks’ former owners, as well as the 12,000 neighbours who were affected by Mr Fluffy.

“For neighbours the auction process will see rebuilding occur in their communities now free from loose fill asbestos,” Mr Gentleman said.

Under the Mr Fluffy planning rules, blocks over 700 square metres can be divided in two and used for two houses.

Mr Ponton said while there was scope for some of the blocks to become dual occupancies, it would be up to the new owners.

“The people who were interested in these properties were very keen to move into these established suburbs,” Mr Ponton said.

“It gives them the opportunity to purchase a large block of land in an established suburb without the costs normally associated with having to demolish the old home.”

The next five blocks will be auctioned on Thursday when five northside blocks go under the hammer.

Auction results

52 Collings Street Pearce (729 sqm) – $605,000

40 Serpentine Street Duffy (694 sqm) – $480,000

14 Nangor Street Waramanga (694 sqm) – $476,000

83 Doyle Terrace Chapman (1459 sqm) – passed in

74 Darwinia Terrace Chapman (1059 sqm) – $610,000