‘Underwhelming’: Seller’s take on market after home auction rocked by rates rise

Owner-builder John Haley took his cottage to auction the day after the Reserve Bank of Australia hiked interest rates. Here’s what happened.

John Haley at the 1900s cottage he took to auction following a 4-year renovation in Kelvin Grove, Brisbane Pic: Lyndon Mechielsen/Courier Mail

Owner-builder John Haley faced the challenge of auctioning his Kelvin Grove home the day after the Reserve Bank of Australia hiked interest rates to 4.35 per cent.

Mr Haley described bidding as “underwhelming”, despite strong interest through the campaign.

With 48 hours for negotiations to take place before the top bidder’s cash unconditional offer expired, marketing agent Tamara Lee, of Ray White Ashgrove, worked late into Friday evening to close the deal.

Kelvin Grove was named the city's most undervalued suburb. Pic: Lyndon Mechielsen/Courier Mail

The renovated cottage at 42 Vale St sold for $1.455m, after the buyers agreed to top up their highest auction bid by $55,000.

Inner-city Kelvin Grove, highlighted by DSR Data as Brisbane’s most undervalued market with a typical house price of $972,000, sat $282,000 below neighbouring areas, with a demand to supply ratio of 66 out of 100.

Mr Haley said the result was “the best possible scenario for the economic climate”.

“Our expectations of the market were maybe a little high. It’s a little fickle at the moment and interest rates hit another upturn the day before the auction, which scared some buyers,” he said.

Blending old and new to create a dual living property

An outdoor spa was added

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November’s rate rise of 25 basis points was the 13th increase to the official cash rate in 18 months, but the first since June.

He and partner Wendy Sheather had purchased the dilapidated 1900-built character home for $645,000 in 2018, undertaking a four-year architectural renovation.

The original two-bedroom, one-bathroom cottage’s traditional features such as timber floors, VJ walls, high ceilings and leadlight windows were preserved, while the layout was adapted to modern living.

A clever design across two levels

Light and bright interiors

Original timber floors and stained glass windows were restored

A clever design across two levels now comprises three bedrooms and two bathrooms in the main house, with a self-contained one-bedroom wing with a kitchenette, bathroom and separate entry.

The 253 sqm property also has a large north-facing covered entertaining deck and an outdoor spa.

“It was probably the worst house on a really good street when we bought it,” Mr Haley said.

“The cottage is not actually heritage listed, but it was under that sort of threshold where there are stringent guidelines as to what you could and couldn’t do. After a lot of negotiation and compromise we decided to leave the 1900s footprint, but build a 2020 footprint next to it, and try to meld the two as best you can.”

The home now has 4 bedrooms and 3 bathrooms

Contemporary finishes

Throughout the renovation, the couple and their two daughters, aged 20 and 17, lived in the property, enjoying its proximity to sought-after Kelvin Grove State College and their work in the CBD.

Ms Lee said the redevelopment of Victoria Park and other infrastructure projects in the area had increased its appeal with a younger buyer demographic.

Originally published as ‘Underwhelming’: Seller’s take on market after home auction rocked by rates rise