Auction results were still patchy in Sydney this past weekend. There are definitely buyers out there and many agents have been reporting good numbers at Opens. Clearance for last Saturday actually stood at 65% (well up from late-2010 and early-2011 numbers); but we are seeing most of the transactions in the lower price brackets (and a resulting low median price of cleared properties). The $1-1.5 million bracket is seeing a lot of active buyers out and about, but the upper end price brackets are sluggish. So what we have right now is basically a tiered market.
Transactions are still happening – just not as frequently at the Auction. ‘Hot’ Auctions are far and few in between. Many properties are being passed in with no bids, but still selling immediately after Auction at good prices. We are seeing final selling prices much closer to the quoted price guidance that was given by the agent during the campaign.
The few ‘hot’ Auctions we have seen are ones where the properties have been seriously under-quoted. Buyers should rightly be concerned as this will once again encourage other selling agents to follow suit and revert to heavy under-quoting to spur interest.
This 2 bedroom full brick house in original condition was seriously under-quoted at around $900,000-$950,000. The opening bid was $900,000 and there was spirited bidding from multiple parties, with the gavel falling on $1.125 million, which was not an unreasonable price. We just feel sorry for those who came to auction with hopes of acquiring the property for under $1 million.
Vic Lorusso (Channel 10’s traffic chopper reporter) was the auctioneer for this 3 bedroom full brick house with level rear yard. Auctioneers have to work hard these days… this Auction opened at $950,000 despite the price guide quoted throughout the marketing campaign being $1.2-1.3 million. After agonisingly slow bidding (mostly in increments of $5,000) the property was passed in (without any Vendor Bid) when the bid had eventually reached $1.235 million. All that work by bidders and auctioneer alike for nothing! We think this is the case of an unrealistic vendor. It certainly was not lack of interest or marketing as the property saw 33 groups through at the 1st Open for Inspection and 12 contracts out.
About Oliver Stier
Oliver J. Stier is the Director of OH Property Group, a leading Sydney buyers agency. He studied Quantitative Economics and Finance at Cambridge University (UK), University of Toronto (Canada) and Princeton University (USA). In addition to being a licensed real estate agent, Oliver also holds the Chartered Financial Analyst (CFA) designation.