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A first home buyer paid $722,500 for an updated three-bedroom apartment in North Melbourne at auction on Saturday, using the federal government’s 5 per cent deposit scheme, after the vendor cut their reserve to sell.
Three parties registered to bid for the well-presented home with a balcony and leafy outlook at 5/55 Haines Street, although one didn’t turn up.
The property was one of 692 scheduled to go to auction in Melbourne last week. By Saturday evening, Domain Group had recorded a preliminary auction clearance rate of 55 per cent from 464 reported results throughout the week, while 94 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.
Two potential buyers arrived for the auction of the North Melbourne apartment, which was on a stratum title, which means each owner in the building has a title to their apartment but holds shares in a company that manages common areas, instead of an owners corporation.
The buyer made a genuine bid of $690,000, below the price guide of $700,000 to $730,000.
With no further offers, the home was passed in. The reserve had been $735,000 but the buyer and vendors reached an agreement in post-auction negotiations.
There is no legal requirement for a vendor’s reserve to be in line with their property’s price guide.
Jellis Craig Fitzroy selling agent Trevor Gange said the vendors live in New Zealand and no longer require the property, which was recently rented.
Interest in the home was largely from first home buyers, except for one investor who didn’t turn up, Gange said.
“It is still a challenging market. There are still deals being done,” he said. “Buyers feel like they have more power.
“It is a great market to buy in. There is always people who want to sell, and to buy in a challenging market is better than to buy in a rising market.”
An unlivable East Melbourne fixer-upper sold for $2 million, well above its reserve price of $1,625,000.
The three-bedroom terrace at 146 Simpson Street was listed with a price guide of between $1.55 million and $1.65 million.
Four parties bid, starting from $1.4 million, in $50,000 increments to the bottom of the price guide.
Then the stride shortened to a mix of $10,000 and $5000 offers, and two parties fought it out over the last $300,000.
Ray White CRE’s Toby Campbell described the sale as a “brilliant result” after the home was in one family for 85 years.
“It was above their wildest hopes,” Campbell said. “The house is totally unlivable. You can’t move in. Some of the floors are collapsed.”
Interest came mostly from parties looking to renovate the home themselves, Campbell said, and they were attracted to the single-level layout in a sought-after suburb. One builder-developer bid.
The buyers are a couple who intend to renovate but are unsure if they would move in or sell it, Campbell said.
He estimated it would need $1 million in renovation works to make it “liveable” and $1.5 million spent to make it “nice”.
In Melbourne’s west, a family paid $858,000 to upsize to a five-bedroom house in Hoppers Crossing.
The well-presented home at 41 Birchwood Boulevard was listed with a price guide of $790,000 to $850,000. The reserve was $840,000.
Ray White Hoppers Crossing principal director Shahid Khan said the home didn’t sell when it was previously offered to the market. But after some updates, such as rendering and work on the gutters, and a relaunch, the home sold within 25 days.
Khan said some buyers worried that small issues could have major costs to fix, but the refurbishments allayed those concerns.
Six parties bid on the Hoppers Crossing home, beginning at $770,000 and rising in $10,000 offers to $800,000.
It then increased in $5000 and $1000 offers. An attempt to place a $100 bid was rejected.
The new owners are moving from a three-bedroom to a five-bedroom house.
“They like the location and want to stay in the same area,” Khan said.
The vendors are moving to be closer to their children’s schools.
Khan said the market was all right in the $700,000-to-$750,000 range but slower above.
Sellers have the most success with buyers “if a property is priced well and they can see the value, especially with the land”, he said.
LJ Hooker head of research Mathew Tiller said Melbourne’s auction clearance rate showed the market was “a little bit soft at the moment”.
“But the 55 per cent result demonstrates that there still are sales occurring and people turning up to auctions,” he said. “It is not a dire result but a little bit soft.”
Tiller said the number of properties coming onto the market was slowing down as owners hesitated amid the economic uncertainty.
