Sydney auctions: Enmore terrace sells for $1.05m but clearance rate slumps to 48 per cent

Sydney’s auction clearance rate has fallen below 50 per cent, with less than half of all listed auctions for Saturday selling under the hammer.

By 6.30pm, the Domain Group reported a clearance rate of 47.8 per cent from 347 scheduled auctions and 198 reported results.

It comes amid suggestions one buyer auctions could be the new normal for Sydney’s property market as the banks continue to tighten their lending standards.

Agents report seeing fewer buyers make it to the big day despite their serious intentions to show up because they fail to get finance approved in time.

Michael Harris, selling agent and director of Raine & Horne Newtown,  expected at least two bidders for 32 Charles St, Enmore, but one buyer was a casualty of the credit crunch.

“There was another buyer who was very interested. In fact she’s local to the area, but unfortunately once again finances and the royal commission is causing real issues … so they were not ready for auction,” said Mr Harris.

Nevertheless, bidding eventually kicked off at $950,000 for the two-bedroom terrace in Sydney’s inner west after a bit of work by the auctioneer Charles Powell, who was greeted by a few minutes of silence.

Mr Powell told the crowd, and the sole bidder, that “we’ve been quoting $1,050,000 throughout the campaign” and needed more bids before he could close the auction.

Mr Harris paced back and forth between the bidder and the vendor’s representative, negotiating higher bids in an attempt to keep both parties happy.

The sole bidder bid against himself twice more, after much cajoling by the selling agent, at $1.02 million and $1.05 million when he shouted out “it’s too much”.

Mr Harris consulted the vendor’s representative one last time before he gave the auctioneer the all clear to allow the hammer to fall.

Mr Powell replied: “It’s not too much, it’s right on the money.”

The home, which sits on an 88.5-square metre block of land, last sold for in 2005 for $495,000. The suburb’s median house is $1.45 million.

After the auction, Mr Powell told Domain that “to get something sold under the hammer is good”.

He said while one bidder auctions may not become standard, they were definitely happening more frequently.

“The crash, boom, wallop auctions is gone for the time being,” said Mr Powell.

“There’s a range of factors affecting it – interest rates, the Chinese market has left certainly to a big degree, the banks tightening up, the Royal Commission, even winter can be a determining factor,” he said.

The vendor’s agent, Real Estate Expertise director Tia McCarthy, agreed tightened lending standards were affecting buyers.

“They almost need four to six weeks to get finance [approved] because of the Royal Commission. It’s been a lot tougher to get finance. That’s had an impact and people aren’t ready for that,” Ms McCarthy said.

“A year go that would have happened, it’s a different market now. The location is what sold this place.”

Mr Harris said buyers needed to give themselves more time to ensure their loan was approved before auction.

“It’s right throughout marketplace at the moment. Unfortunately buyers seem to think a lot of the time they’ve got their finances but at the last minute they realise that they don’t have what they really do require for the banks,” he said.

“We’re walking through it at the moment. People are more and more aware of the situation. Buyers are starting to realise they need to speak more with their banks before they get to the auction floors, but I’m hoping we’re starting to see or people understanding this new platform for financing,” he said.

It was a similar story for the auction of a two-bedroom, two-bathroom apartment in Rosebery, in Sydney’s south.

Despite more than 30 groups going through the property at 105C/797 Botany Rd during the four week campaign, and agents expecting at least three serious buyers on Saturday morning, only one buyer showed up and registered.

Selling agent Adam Pierce of McGrath Maroubra said he negotiated ten minutes beforehand and sold under the hammer to the sole bidder for $1,025,000, falling $15,000 short of the reserve, but well above the suburb’s median unit price of $885,000.

“The vendors were very happy to meet the market,” Mr Pierce said. “They realise today’s market is very different to last year’s market and if you’d like to sell the property in today’s market then you’ve got to be realistic.”

He said he was seeing fewer buyers at auctions as they struggle to get finances approved in time.

“We’re seeing it across the board at all levels, from one bedroom apartments to four- to five-bedroom.”

Elsewhere in Sydney

199/806 Bourke St, Waterloo Photo: Supplied

PASSED IN
Waterloo
199/806 Bourke St
2 bedrooms, 1 bathroom, 0 car spaces

This property saw about 20 groups go through the house with a small amount of investors and few first-home buyers. Brendon Clark of LJ Hooker Green Square and Waterloo said he was expecting three registered bidders, but two didn’t get their finance approved in time. The property passed in with no bids. The reserve was just over $700,000. Mr Clark said “banks are reworking their numbers”, affecting loan approvals. He said he was in negotiations with sole registered bidder, a first-home buyer. The property last exchanged on the market in 2011 for $435,000. Waterloo’s median apartment price is $845,000.

See more at domain.com.au/2014437367

8 Bridgeview Crescent, Thornleigh. Photo: Supplied

SOLD $1,315,000
Thornleigh
8 Bridgeview Crescent
3 bedrooms, 2 bathroom, 2 car spaces

Two of the four registered bidders threw their hat in the ring as they kicked off the auction with a $1.25 million opening bid. It went up in increments of $10,000 and $5000 before it sold for $1,315,000 to a young family from Wolli Creek looking to upsize. Selling agent Patrick Goode of Soames Real Estate Northern Districts said it sold for what was anticipated. He said the reserve was set at $1.4 million, but was always set higher “as leverage to give us something negotiate on”. The buyers’ guide on the property was $1.3 million. It last sold in 2013 for $865,000. Thornleigh’s median house price is $1.3 million.

See more at domain.com.au/2014455420

25 Trouton St, Balmain Photo: Supplied

SOLD $1,190,500
Balmain
25 Trouton St
2 bedrooms, 1 bathroom, 0 car spaces

This two-storey cottage was on the market for the first time in about 60 years. Originally built in the 1850s, it’s also one of Balmain’s earliest homes. Selling agent Peter Gordon of Cobden & Hayson said there were few like it around these days and had garnered plenty of interest, with more than 60 groups of people going through the property. Three of the four registered bidders were active. Bidding started at $1 million, moving quickly to $1.1 million before slowing down to $1000 increments until it sold exactly on reserve. He said the result was a “good sign for the market that you’ve got four people competing for a property that needs further investment”. It sold to a couple downsizing from the north shore. Balmain’s median house price is $1,935,000.

See more at domain.com.au/2014457495