Auction Activity Hits Fever Pitch
31.05.2009

Market activity surged this past week with the auction clearance rate rising again in the face of steeply rising stock levels.

The Real Estate Institute of Victoria reports that 82 per cent of the 647 properties on offer sold, up one percentage point on the previous week to return to its highest point for a Saturday this year. (The results of another 45 scheduled auctions were unreported.) "It’s clear the market has moved from healthy to strong," said REIV chief executive Enzo Raimondo.

"A couple of months ago, clearance rates were holding in the mid-70s, but now we’ve seen the clearance rate above 80 per cent for three weeks in a row—and that’s come even with rising stock levels." The number of properties that were up for sale this past week, which was the highest for the year to date, was similar to the stock on market in the boom period of 2007 and the downturn of 2008, when clearance rates were 85 per cent and 65 per cent respectively.

"The auction system is clearly working again," said buyers’ advocate Frank Valentic of Advantage Property Consulting. "We’re seeing properties up for auction attract multiple bidders and sell well under the hammer." In Richmond, six bidders used more than 300 bids at the hotly contested auction of 6/7 Davison Street, with the 1970s two-bedroom unit selling for $501,000, or nearly 32 per cent above its declared market price. "The auction took 49 minutes, two bidders really fought it out, and they came down at one point to $250 bids," said Biggin&Scott director Chris O’Shaughnessy. The property was advertised at $350,000 plus.

A first home buyer kicked off the auction of 6/36 Park Street inMoonee Ponds with an attempted knockout bid that was $10,000 higher than the $290,000 reserve. Four other parties quickly jumped in, and the one bedroom apartment eventually sold to another first home buyer for $340,000 —more than 17 per cent above its reserve—through Rendina Real Estate.

The four-bedroom Californian bungalow at 20 Olver Street in Preston sold for $640,000 through after auction negotiations, fetching $30,000 more than the price at which it was passed in. Hocking Stuart opened with a vendor bid of $540,000 and five genuine bidders took it to $610,000 before the action stalled, according to vendor advocates VIPConsulting.

The auction of 9 Crozier Court in McKinnon opened on a vendor bid of $1.05 million, but six bidders easily pushed the sale price of the modern four-bedroom house to $1,381,000. Joint agents Century 21 and Hocking Stuart declared the property on the market at $1.2 million.

The highest priced result reported to The Sunday Age yesterday was for 61-63 Alfred Street in Kew, a four bedroomVictorian house that sold for $4.85 million through Marshall White. The reserve was $4.5 million.

A rise of just 99¢ sealed the deal for 2/54Warnes Road inMitcham, with the winner paying $499,999.99 for the three-bedroom unit. Five bidders took the property from an opening at $430,000, with bidding at one point coming down to $50 increments. "The (buyer) would have lost the $3000 first home buyer bonus from the Victorian Government if the property had sold for $500,000," said Ray White director MarkWalsh.

There are just 157 auctions scheduled over the Queen’s birthday long weekend.