Be realistic, vendors warned as selling season nears end
Property sellers are being warned to be realistic about the prices they can expect to achieve for their houses and flats with only five weeks left before the market closes for its summer hiatus.
Melbourne turned in another solid set of results over the weekend with a few runaway successes, but some agents reported a shortage of bidders.
Melbourne's clearance rate of 72 per cent over the weekend was derived from 925 auctions reported to the Real Estate Institute of Victoria; Australian Property Monitors (owned by Fairfax Media) reported a slightly higher 73 per cent from 692 results and research house RP Data produced a lower 69.2 per cent clearance rate from 996 results.
RP Data spokesman Robert Larocca said this was only the second weekend in 14 weeks with the clearance rate falling below 70 per cent.
"It's too early to say the market's pulling back but it certainly shows it's not racing away from us," Mr Larocca said.
Sydney had its biggest weekend of auctions with 784 properties under the hammer. APM reported an 84 per cent clearance rate.
The REIV data shows 124 properties sold before auction and 262 passed in - 142 of them on a vendor bid. A further 141 results have yet to be reported to the REIV.
While not a stellar performance, the market is much healthier than last year when a 59 per cent clearance rate was achieved on a weekend with 1100 auctions.
The solid results follow the Reserve Bank's decision last week to keep the cash rate on hold for another month but there is some speculation that further cuts to the historic low rate of 2.5 per cent could occur next year in a bid to hold down the value of the dollar.
Some of the biggest deals of the weekend sold for close to their reserve prices. Kay & Burton's Gowan Stubbings had the two biggest auctions in Toorak.
Just off Heyington Place, 3 Rostill Court fetched $3.02 million, only slightly over its $3 million reserve, with competition from two bidders. Mr Stubbings said the buyer planned to live in the house, which is on 692 square metres.
An hour later, he auctioned 21A Albany Road, a single-level three-bedroom townhouse. While the result is undisclosed, it is understood to have sold for $4.55 million after a single bid.
Mr Stubbings would not confirm the price but he emphasised how much time and effort went into educating vendors about the value of their properties. "People have to be realistic about ... valuing their homes. The buyer pool is big but vendors have to be realistic," he said. "We've really only got five weeks to go ... there are buyers out there for pretty much everything so long as vendors meet the market."
Williams Batters director Philippe Batters said: "We find there are very, very good results but they aren't happening all the time. I keep reading that we're in a boom market; the trouble is, some vendors believe it.
"If a property is really good, people will fight for it. It doesn't mean it's really expensive, it just means it has special features," Mr Batters said.
As summer is beckoning, the number of beach houses on the market has started to increase but the buyers are slow to arrive.
Prentice Real Estate agent Don Campbell put two properties from a deceased estate to auction on Saturday but the house at 19 Oxford Street, Sorrento, was passed in on a vendor bid of $500,000 and an adjoining block of vacant land was passed in, also on a vendor bid, at $450,000.
"Even in the current market, $450,000-$500,000 for a block of land in Sorrento is cheap, very cheap," Mr Campbell said.
"Things down here are pretty slow. We're not reflecting what's going on uptown. Rye and Rosebud, the cheaper end of the market, are going well. But from Blairgowrie to Portsea, it's very slow.
Kay & Burton had better luck in Flinders, where 14 Bass Street, a four-bedroom beach house with sea views, sold for $1.645 million.