The Block 2022: 5 questions to come from the auctions

Reality well and truly hit Australia’s favourite property reality TV show this year.

Following a step-change in the Australian property market over the course of the show and a dramatic relocation from Melbourne’s ‘burbs to tree-change Gisborne, here is how this season’s most crucial factors affected this season of The Block.

How does Omar and Oz’s prize money compare to previous seasons?

Omar and Oz, the self-described “black horses” of the competition smashed the previous winners’ prize records, taking home a whopping $1,686,666.66 – the biggest prize given in Australian television history.

In 2019, Jimmy and Tam won $1.066m after their mid-century modern-inspired property at New Street, Brighton, sold for $966,000 over reserve.

Gallery: Past winners of The Block and their prize money

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Back in 2016, when contestants renovated a former soap factory in Port Melbourne, Will and Karlie pocketed $815,000 in prize money.

Why did three houses not sell?

It’s been five years since we’ve seen properties pass in on The Block. Back in season 13, Ronnie and Georgia’s home failed to sell at auction after bidding failed to meet the reserve of $2.62 million.

Buyer’s advocate Andrew Date, who attended but did not secure a property at The Block auctions this year, said the results were a reflection of today’s market.

“With four out of the five houses, we saw what’s actually happening in the market, where buyers were a little bit hesitant and weren’t really prepared to stretch dramatically.

“But the first auction – I’ve never seen anything like it in 12 years of being in the real estate industry. I think that set false expectations for the rest of the contestants and then we got a bit of a reality check with some softer results and some pass-ins.”

For buyer’s advocate and The Block regular Nicole Jacobs, the answer was simple: “The buyer depth just wasn’t there today – we had buyers but they just weren’t at the right level.

“The first auction was incredibly strong, and just shows that you need two buyers that both want the property. I think that in one way or another, it actually intimidated people for the next few.

“It’s very difficult when you’ve got an already narrow pool of buyers … I thought one, maybe two, would struggle, but I did not think we would have four that struggled.”

Valentic agreed, adding that his buyers were interested at the high $3 million mark, but most didn’t see the value at $4 million.

“Unfortunately, prices have come off and basically The Block is probably nine months behind the market,” he said.

“[The results] are a sign of the times, and a sign of the market. The Block was chasing pre-downturn prices.”

Why has Danny Wallis bought so many homes in recent seasons?

Melbourne philanthropist Danny Wallis made his first appearance on The Block in 2012, buying Mike and Andrew South’s home in his signature bidding style at $1,400,001.01.

Since then, he went on to buy Mitch Edwards and Mark McKie’s home in 2019 and three properties in the 2020 season, and forked out more than $12.245 million for another three in 2021.

In 2020, Wallis told Domain The Block homes were “good value for money” and “get better and better each year”. That year he donated one of the properties to My Room Children’s Cancer Charity. In 2021, he revealed the properties he buys are rented out or used for charitable purposes.

What makes the properties appealing to investors?

Attractive rental income isn’t the only reason investors flock to The Block.

Investors can claim tax deductions through the depreciating value of the properties due to wear and tear over time.

According to BMT Tax Depreciation, the contestants have spent upwards of $5 million in construction costs per property.

Sharon and Ankur from House 3 generated the largest amount of tax depreciation deductions at a BMT estimate of $5,840,166, with the other four properties not far behind.

What can we expect from next season?

The Block Tree Change was by far the biggest in the show’s history. The five teams renovated five homes, each on 4 hectares of land, competing with miserable weather, rising material costs, tradie delays and huge supply issues.

“I don’t think The Block will ever take on properties of this magnitude again – I think that we’ve learnt something here,” Sharon said.

Next year, The Block will be heading back to familiar territory, after the production company bought five fixer-uppers in the Melbourne bayside suburb of Hampton East.

The show was last in the area in 2021 for the Fans vs Favourites season in Hampton, when Mitch and Mark were crowned winners, taking home a total of $744,444.44.

“I think [for] the next series, back in Hampton East … there’ll be a wider market,” Andrew Date said. “It’s a bit closer to the city, there’s a lot more schools around, transport …”

Family-friendly Hampton East, the more affordable bridesmaid suburb to Hampton, has a median house price of $1.4 million.

The Block airs on Nine, a majority owner of Domain.