Owner-occupiers triumph at inner north auctions but market still subdued: agents

Vendors in Melbourne’s inner north enjoyed moderate success at auction on Saturday, with agents saying the federal election result hasn’t immediately energised a wave of buyers to show up and bid.

Experts noted positive talk over the past week but said it would take some time yet for it to translate into a more upbeat market.

A three-bedroom Northcote terrace drew three bidders on the sunny morning for a spirited auction.

The modern take on a terrace home at 11 Gracie Street was being sold as a part of the Nelson Alexander Foundation Day, with agent Robert Enes’ commission going to a local primary school as a donation.

Bidding began low at $800,000 but quickly reached $900,000 between two bidders, before a young couple joined the fray. The home was declared on the market at $930,000 and, after some bids in smaller increments, it eventually sold to the young couple for $965,000.

Buyers Susie Worthington and partner Frances were pleased with the result. Ms Worthington told Domain she felt they’d paid a fair price.

“It’s a great location, the house is beautiful, it’s ready to move into and it’s the ideal size for us. And given the market conditions I think we’ve done really well,” she said.

Earlier across the Merri Creek and in Brunswick East, a warehouse conversion had a brief but successful auction.

The four-bedroom renovation at 122A Victoria Street was done in a classic conversion style, with high ceilings and a mezzanine living area above the kitchen.

A sound-proofed room which could be used as a music studio was built in the rear of the home, in a self-contained flat style. Musicians inspected the home but did not bid, Jellis Craig auctioneer and agent Rob Elsom said.

Just six bids between two buyers were placed, beginning at $1.5 million and reaching a final sale price of $1.62 million.

“[The buyer was] almost the first person through here, they bid pretty strongly and they ended up securing it,” Mr Elsom said.

These were among the 885 auctions held across Melbourne on Saturday.

By evening, Domain Group had recorded a 60.2 per cent clearance rate from 634 reported results.

The reelection of the federal Coalition government, a probable loosening in bank lending standards and a potential Reserve Bank rate cut have had commentators spruiking a market turnaround, but it hadn’t shocked a mass of buyers into action as of yet.

While the market had improved since the election, it hadn’t turned on a dime, Mr Elsom said.

“We need another four weeks … to see if we’re heading in the right direction. A slow healthy increase is what we’re looking for,” he said.

“I think we’ll see more people selling at auction instead of off market.”

Back in Northcote, another three-bedroom terrace did well, selling for a strong $120,000 more than the reserve price of $1.3 million.

Jellis Craig agent Sam Rigopolous said competition between the three bidders for 26 Gordon Grove was fierce.

“The opening bid was strong from a buyer’s advocate and then the next buyer jumped in immediately,” he said. “It shot up to $1.4 million quickly.”

The home sold to an owner-occupier for $1.42 million.

Mr Rigopolous said the home was popular because of its strong fundamentals, even though the market was yet to rebound following the election.

“There was nothing more to do; the vendors had updated the bathroom and the kitchen and it was a high-quality renovation,” he said.

“There were six buyers there [three of whom didn’t bid] and a lot of eagerness to secure this.

“I think that’s just a testament to the scarcity of the market at the moment.”

Wakelin Property director Jarrod McCabe’s team bid at a few auctions on Saturday, and he said the mood seemed to not yet have changed.

“We need to see a bit more first. We’ll see some more confidence. [Buyers] know who the government’s going to be for the next few years and there’s some positive talk around,” he said.

“We haven’t reached the bottom but we’re very close to it.”

He said in the next few months the market should level out.

“We’ll have gotten to a point where we’ll have flattened out and we’ll see a level period for a bit of a while now.”

In Coburg, a two-bedroom home sold well under the hammer, with three families going toe-to-toe.

Property Mavens’ Miriam Sandkuhler bid for 55 Campbell Street on behalf of one of the families, but was unsuccessful. She said it was a hard-fought auction.

“There’s confidence in the market. It was a really strong result. Buyers like certainty,” she said, referring to the passing of the election.

The home sold for $981,000, $46,000 past its reserve price.

Ms Sandkuhler agreed the full effect of changing market conditions was yet to be seen.

“The biggest issue we have at the moment is a lack of good stock. And now there’s confidence it’s about vendors being prepared to sell property and meet the demand,” she said.

In Brighton, a two-bedroom unit passed in at $700,000, $70,000 below its reserve.

It had been listed with a price guide of $700,000 to $750,000.

Buxton agent Tom Davidson said the ground-floor unit at 5/3 Railway Avenue had some further interest after the auction.

“Someone will pick it up, it’s a great opportunity for a ground floor apartment with two bedrooms and close to the Church Street amenities,” he said.

“There’s a walkway that takes you down to the Church Street shops and Middle Brighton train station.”