Clearance rate on the rise

A Richmond milk bar opposite the Housing Commission flats and the All Nations Hotel fetched a robust $1.251 million at auction during the weekend, a sign of the strength underpinning the start of the spring market.

Melbourne's auction clearance rate was 75 per cent from 658 auctions, according to the Real Estate Institute of Victoria, trailing Sydney's 84 per cent from 398 results.

Melbourne's result is lower than last week's 79 per cent but well up on the 63 per cent for this weekend last year. While 166 properties were passed in, 92 on vendors' bids, 71 were sold before auction. Many results - 157 - have not been reported. That will drag down the final clearance rate.

The Edwardian double-storey shop and four-bedroom residence at 66 Lennox Street on a 218.4-square-metre block has an unusually wide 7.8-metre street frontage and the rear stables.

Six bidders competed for the house, which Biggin and Scott had quoted at $750,000-$850,000, and several more were knocked out early by an opening bid of $820,000.

Some 30 bids later, with the price at $1.55 million, auctioneer Andrew Crotty went inside to check with the vendors. The move caused some consternation among the 150-strong crowd given the high price reached at that point.

Mr Crotty said the couple, who had run the milk bar for several decades, still had to be consulted before the hammer came down, even though it was well past the $850,000 reserve. "It wasn't the price. It was the selling of it. They weren't quite ready to relinquish it," Mr Crotty said.

The price, at $5728 a square metre, was a record for that strip of Richmond. The property, which still has its milk bar trappings, will be renovated and turned into a family home, he said.

Wakelin Property Advisory director Richard Wakelin said it was a difficult property to value given the scope of the renovation and the proximity to the pub and the flats.

"But you could run a home office from it and have off-street parking for two cars. And, as for being close to the flats, well, it's all part of the acceptance of inner-suburban living now, that you'll be living close up to all kinds of housing," Mr Wakelin said.

Prices have been rising all year and would continue to climb, stoked by low interest rates, he said.

"It's remarkable that the removal of the first home buyer's grant for established homes didn't result in the first home buyers' departure from the market. There is a real urgency again because they want to try and lock in low interest rates," Mr Wakelin said.

He acted for the vendors of 76 Donald Street, in Prahran, one of an unrenovated 1940s duplex, which fetched $825,000 through Hocking Stuart.

"In March, its neighbour, which is a mirror image but also had a garage, sold for $772,500," he said.

"We set the reserve at $760,000 - just below the price the neighbouring property sold at - and there were five bidders, a mix of first home buyers and investors," he said.

"The interest rates are helping the growing mood of confidence but people are also expecting the Canberra situation to stabilise after next weekend."

Auctions and private sales have been tracking evenly all year but this week auctions significantly outnumbered the 372 reported private sales. Auctions are traditionally set for more competitive properties and can trail off at the upper end of the market.

While Marshall White's Justin Long sold 6 Heymount Close, Toorak, under the hammer for $4.05 million, RT Edgar director Jeremy Fox did not get a bid for 141 New Street, Brighton, which passed in on a vendor bid of $5.3 million. Mr Fox said his vendors were considering an offer.

A private sale in Princes Hill set a record for the area. Woodards sold a renovated double-fronted house, Ormuz, at 299 Pigdon Street for $3.95 million.

Woodards director Jason Sharpe said there was a handful of offers on Thursday afternoon at the close of the private deadline with two bidders in the running.

"It had an underground garage, lifts to the two upper levels and quality fittings. The vendors had renovated it with plans to move in but they changed their minds and decided to stay where they were," he said.

Sunday's auction results

CAULFIELD

SO 3/11 Briggs St B 4rm strata $532,000 Gary

Peer & Associates

SO 28 Clarke Av BV 7rm 583sqm $1,530,000

Gary Peer & Associates

SO 3 Daniell Cr v/land 640sqm undisc Gary Peer

& Associates

CAULFIELD NORTH

SO 20 Lumeah Rd B 7rm 650sqm undisc Gary

Peer & Associates

CAULFIELD SOUTH

SO 5/6 Griffiths St B 5rm strata $601,000 Gary

Peer & Associates

SO 2/203 North Rd BV 6rm s/div $785,000 Gary

Peer & Associates

PI 21 Jenkins St B 6rm 586sqm $1,330,000 lo

$1,375,000 res $1,550,000 Rodney Morley

Persichetti

ELSTERNWICK

SO 9 Downshire Rd B 6rm 668sqm undisc

GLEN HUNTLY

SO 1 Etna St WB 4rm 440sqm $955,000

Woodards

ST KILDA

SO 7/260 St Kilda Rd Rend 2rm $572,000 Biggin

& Scott

ST KILDA EAST

SO 5/392 Inkerman St B 4rm strata $473,000

Gary Peer & Associates

SO 3 Young St BV 3rm 75sqm $640,000 Wilson