Inner-Melbourne $1 million-plus family home market shows strength: Mal James

With uneven buyer demand, top-end auction offerings are trailing off in both the Melbourne and Sydney auction markets.

But an Edwardian weatherboard in Mayston Street, Hawthorn, listed through Marshall White and Jellis Craig, was emblematic of strength in the inner-Melbourne family home market. It sold for $1,965,000 after three bidders competed. It had a $1.83 million reserve and was Melbourne’s top sale.

Buyers’ agent Mal James says most Melbourne family homes at this price level have gone well this year.

“And we do have a stock shortage in April.”

He says the price reinforced his perception of the market’s strength and that $1.9 million was the market level for this home as there were three real bidders.

“This surprised me – yes, it's good land size, but I did not expect it to be quite so strong.

“But, again, this is a family home and tighter-than-anticipated stock levels says for the right home the market is far from dead.

“Prices have definitely stabilised from last year's falls for the moment for these types of family homes – absolutely no question about that,” James advised in his auction review.

"The $1 million-plus inner-Melbourne market has little option but to remain solid for the moment, with universal demand for market priced homes and new supply at a trickle in April.

“On top of this, new stock levels appear well down on initial selling agent expectations for May.”

The top sale in Sydney was a two-bedroom home at Northbridge, on the lower north shore, which was offered for the first time in 25 years.

The $2.25 million sale through Ray White Northbridge followed 10 registered bidders, with five competing strongly.

But none of the three offerings over $2 million sold in Melbourne, with no bidders on a $3.7 million-plus Danks Street, Middle Park, offering.

A Nelson Road South Melbourne offering – $2.4 million vendor bid – was among the 45% of Melbourne’s $1 million-plus listings that were passed in.

Brisbane auctioneer Jason Andrew said while buyer registrations continued to rise, the number prepared to act had been falling.

"While the inner ring of Brisbane is performing better than the outer suburbs, the air of optimism that was tangible earlier in the year has recently been lacking.

“News of an interest rate cut would normally spark enthusiasm in the property market, but despite last week’s speculation around a possible series of cuts on the back of the latest inflation data, we have not seen any change in buyer sentiment at this point,” Andrew said.

“There’s still buyer interest but it’s predominantly coming from the sidelines – most are unprepared to actually get in the ring.”

“Consumers are jaded – they don’t believe the banks are going to pass on any official cut anyway.”

"Buyers in today’s environment are only interested in value,” Andrew advised.

There were 217 auctions listed in Sydney, down on 316 the previous weekend and 352 the year before. In Sydney, the clearance rate was reported as 48.8%, down on 58% on the prior weekend, according to Australian Property Monitors, which is owned by Fairfax Media.

There were several districts faring well.

The Canterbury Bankstown district was strong, with 73% of its 21 listings being sold.

Some 55% of the 50 upper north shore were sold.

And 61% of the 38 in the city and east were sold.

In Sydney’s west was weak at 44%. The south west had 18 results with six finding buyers.

The NSW central coast had 17 results, of which seven found buyers.

The south of Sydney had nine sales from its 26 reported offerings.

The Melbourne residential auction market has been providing very consistent outcomes, with the weekend no different given its 60% clearance rate.

It compares to 59% last weekend.

It represents an improvement on the 56% on the same weekend last year.

The five Melbourne weekends leading up to Easter returned clearance rates in a very tight band between 58% and 61%, which indicates very consistent demand despite the fluctuations on volume and price.

It has dipped to 55% on one weekend since.

There were 520 weekend auctions reported to the Real Estate Institute of Victoria, with 310 selling and 210 being passed in, 130 of those on a vendor’s bid.

Announcements on Tuesday of the state budget and interest rates have the potential to improve consumer confidence, the economy and the property market over the coming months, REIV boss Enzo Raimondo says.

Next weekend the REIV expects around 670 auctions followed by 650 in a fortnight in Melbourne.

APM has 380 and 360 scheduled auction listings over the next two weeks across Sydney.