Money Property Property market woes continue with more to come in 2019

Property market woes continue with more to come in 2019

Property wrap Dec 15 16
The $3.075 million sale of this five-bedroom Fitzroy North home was Melbourne's top result. Photo: Nelson Alexander
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A converted warehouse in Collingwood – with a Pinocchio mural on its back wall – passed in at weekend auction without a bid.

The truth was there were actually keen interested parties.

The post-auction negotiations involving three parties saw the former leather goods factory at 54 Sydney Street selling after auction at $1.34 million.

Property wrap Dec 15 16
The property, last offered at $700,000-plus in 2006, sold for $1.34 million. Photo: Nelson Alexander

The eventual sale price sat midway between its $1.275 million to $1.4 million price guidance for the three-bedroom, three-bathroom home on its 170 square-metre holding. It was last offered at $700,000-plus in 2006.

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The home is a converted leather goods factory. Photo: Nelson Alexander

On the last busy Saturday for auctions before the traditional long summer break, Melbourne’s 46.9 percent weekend auction clearance rate was the best performing capital city result, according to CoreLogic.

But the as yet unreported results will likely see the final under-the-hammer sales rate slip lower, possibly into the 30s as the few buyers remaining in the mid-December market have become more cautious and more cagey.

Melbourne was host to 1179 auctions weekend auctions.

A $3.075 million Fitzroy North sale topped the results, according to the Real Estate Institute of Victoria.

The 10 Alister Street offering was marketed as a residence setting “a new benchmark in luxury family living with its stunning design, bespoke features throughout and impressive indoor/outdoor entertaining spaces”.

Property wrap Dec 15 16
The house had a gas/solar-heated pool/spa. Photo: Nelson Alexander

It had five large bedrooms all with fully-fitted robes, plus five ensuite bathrooms and a guest powder room.

Property wrap Dec 15 16
The house included a fully-outfitted home office, separate lounge and upstairs retreat. Photo: Nelson Alexander

The Nelson Alexander price guidance had been $2.9 million to $3.1 million.

Over the same weekend last year, the Melbourne auction clearance rate was significantly higher with 65.9 per cent of the 1630 auctions returning a successful result last December.

Canberra was the next-strongest weekend market at 46.2 percent.

There were 717 auctions held in Sydney with preliminary results showing a 43.6 per cent clearance rate.

Over the same week last year 708 homes were taken to auction across the city returning a clearance rate of 52.7 per cent.

“It will be interesting to see whether or not the final clearance rate can hold above 40 per cent this week,” CoreLogic auction analyst Kevin Brogan noted.

Sydney’s eastern suburbs returned the strongest preliminary clearance rate again this week at 65 per cent from 43 results, with no other Sydney sub-regions above 50 percent.

Sydney’s top sale was the nation’s top sale which came after 11 registrations to bid on a Cronulla waterfront home.

The 70 The Esplanade offering sold through Ivan Lampret, of Gibson Partners Real Estate, for $3.787 million, the first time it had been listed in five decades.

Property wrap Dec 15 16
The Esplanade home has stunning sea views. Photo: Gibson Partners Real Estate
Property wrap Dec 15 16
The home was being offered for the first time in 50 years. Photo: Gibson Partners Real Estate

Brisbane’s fringe, the Beenleigh district had the cheapest weekend result, according to Domain, when a three-bedroom unit was sold for $145,000.

The 14/24-28 Albert Street, Eagleby had previously sold in 2009 at $217,000, but was higher this time than its $133,500 sale in 2006.

Eagleby sits along the Gold Coast corridor about 30 minutes drive on the M1 to Brisbane or the Gold Coast. Brisbane’s clearance rate stood at 33 per cent.

Across all the capitals, there were 2406 homes taken to auction over the week, down from both the previous week when 2631 auctions were held, and this week last year when 2890 auctions were held across the combined capital cities.

Preliminary CoreLogic results show a national clearance rate of 43.8 per cent this week, increasing from last week’s final clearance rate of 41 per cent, the lowest clearance rate recorded since October 2011.

One year ago, a clearance rate of 60.7 per cent was recorded.

“The final clearance rate has revised down below 42 per cent for the last three weeks and given the low preliminary result it’s possible that the final clearance rate may just fall below 40 per cent once the remaining results are collected,” Brogan suggested.

“No Christmas cheer here,” AMP Capital economist Shane Oliver tweeted after the weekend results.

“Credit tightening, supply surge, lower foreign demand, FOMO becoming FONGO, and tax issues point to more of the same next year,” he suggested.

The much-publicised auction of gangland widow Roberta Williams’ former Essendon house failed to occur, but there was a sale.

The townhome at 82 Primrose Street, which had been owned by her former father-in-law George Williams, had been listed with a reserve price of $750,000 by the Australian Tax Office to recoup his debts.

Property wrap Dec 15 16
The home sold despite Roberta Williams’ attempts to halt the sale. Photo: Nelson Alexander

The auction was cleared to proceed after a last-minute legal challenge from Ms Williams.

The listing agent David Vaughan, of Nelson Alexander, confirmed the pre-auction sale but would not disclose the price or buyer.

Next weekend Melbourne has just the 160 scheduled auctions, although many will not take place, being scheduled so close to the festivities.

While homes are still changing hands, the Melbourne auction market seems set to finish with its worst run since CoreLogic auction records began in 2008, amid the global financial crisis downturn.

Last weekend marked the first time every sub-region across Melbourne had failed to top 50 per cent, although the inner-south bucked the trend this weekend with a preliminary 57 per cent success rate.

Jonathan Chancellor is editor at large at Property Observer

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