Temperature Drops while Market Boils

July 21, 2014

Spectators shivered through auctions in Melbourne’s Inner West, however, shrivelled hands raised up as the chilly conditions failed to deter buyers’ competitive spirits. Compton Green witnessed a market which can be read no other way than red hot, defining a healthy start to August as the clearance rate spiked up to 100%.

The sun was doing its best to shine through the clouds and onto the crowd that had gathered outside to witness the auction of 35 John Liston Drive in Newport. Striking a contemporary pose, this private townhouse flaunts beautifully considered modern comfort and entertaining naturally takes centrestage. Auctioneer, Adrian Butera gave a glowing yet concise spiel and opened the auction without too much fuss. “Who would have thought that it was just about snowing here yesterday but that’s Melbourne! This is a sweet spot, you know similar on the tennis racket when you’ve hit the ball well. It’s hard to fault the incredible detail, the meticulous large kitchen and there’s truly something for everyone here today,” he said.

Within seconds, one bidder shouted out $750,000 and Adrian called out “Will it be a short race?” Another bid of $770,000 opened up the start of the competition and within seconds, multiple contenders were battling for it. The price spiked up to the climax of $822,000 while the marketed quote range was $760,000-$790,000.

Next on the auction agenda was 1/290-292 Nicholson Street in Seddon. This year there has been significant demand for homes in the $400,000 and $500,000 price range so a heated auction was to be anticipated. The vendor of this property was Neighbours Scriptwriter, Holly Alexander who wants to move to a home with room for an office. Marketed as “A First Home Secret Surprise” due to its tucked away positioning down a long driveway, this townhouse is seconds from the pulse of Seddon’s growing café society and showcases optimum privacy.The Auctioneer, Adrian Butera highlighted the property’s endless traits to the crowd of enthusiastic onlookers. “If the position doesn’t get you over the line, the home will. It’s a starter package and will attract a wide demographic whether it’s a first home buyer, investor or downsizer,” he explained.

Adrian opened up the auction with a vendor bid of $470,000 and he did not have to over exert himself too much as the next bidder raised their hand and enthusiastically voiced their bid for $480,000. In no time at all, multiple people joined into the auction ring and a well fought but organised battle ensued. The next sequence of numbers included $485,000, $490,000, $494,000, $500,000, $505,000, $557,000, $560,000 before the final admission of defeat as it was knocked down to $564,000. Supporting friends embraced the buyer with one even yelling out “You beauty!” and this auction was definitely a heartfelt and memorable start to August.

The Facts

Supply and demand has become more evenly matched once again and price growth tends to remain at a consistent level.
RP Data-Rismark Home Value Index shows prices jumped 3.7 per cent in Melbourne last month.
The top performer for capital gains has been Sydney where prices were up almost 25 per cent in the last two years, while Darwin and Melbourne have recorded rises of 20.4 and 18.5 per cent respectively.
With interest rates remaining low, we are expecting that capital gains will continue for the rest of 2014.
In the Inner West, we have seen above average auction clearance rates this Winter and this trend has been recognised right across Melbourne.
Australia’s major banks recently cut three and five-year fixed-rate mortgages to record lows below 5.0 percent, even with the Reserve Bank of Australia (RBA) expected to hold its cash rate steady at 2.5 percent for some time yet.