By Sarah Webb
An investor’s pain became a first-home buyer couple’s gain in Mill Park on Saturday, as rising land taxes forced a Sydney-based vendor to offload a long-held property.
After months of heartbreak at the auction block, the young couple finally snagged the keys to a three-bedroom home with a study at 36 Dunlop Crescent, shelling out $835,000 - $60,000 above reserve - to end their house hunting saga.
Located near Westfield and boasting multiple living zones, a double garage and a 599-square-metre block, the home’s appeal drew four competitive bidders, including three first home buyers. It had a price guide of $690,000 to $740,000.
Bidding kicked off strongly at $720,000 and rose rapidly in largely $10,000 increments before being called on the market at $760,000.
“From the buyers’ end they knew the process and what to expect so they waited until it went on the market,” said selling agent Robert Stambolziev.
“They’d missed out at three or four auctions in the past few weeks, including one just a street away last weekend so it was great to see them finally secure this one.
“The owners were happy too … they were selling up due to those land tax changes and just needed to get out because of those costs. It was initially their family home and then became an investment when they relocated to Sydney.”
Stambolziev said the toughened property land tax threshold changes had spurred a trend across the Melbourne market, with the flipside being an eased entry for first home buyers.
It was one of 1066 scheduled auctions in Melbourne on Saturday. By evening, Domain Group recorded a preliminary auction clearance rate of 60.2 per cent from 729 reported results, while 80 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.
Meanwhile, in Kensington, a young architect couple secured a Victorian terrace at 46 Bellair Street for $992,000, just over the $980,000 reserve. The semi-detached property, nestled in one of Kensington’s top streets, drew significant attention for its potential rather than polish and featured three bedrooms, a patio, and a price guide of $900,000 to $990,000.
Selling agent Jerome Feery of Jellis Craig said while renovation-ready homes are typically a tougher sell in the current market, Kensington’s older, character-filled properties are still hotly contested.
“And that was especially the case with these buyers. They plan to renovate it slowly over time … and it will be interesting to see what they do with it,” Feery said.
The auction started at $900,000, with three bidders driving up the price in $20,000 increments to $960,000. From there, the pace slowed to $5,000 and then $1,000 bids until the architects secured the winning bid. The property, previously priced at $1 million to $1.1 million, was adjusted downwards in response to market conditions.
Feery added buyers were taking advantage of Melbourne’s market being a bit suppressed. The Kensington home was being offloaded by investors who had owned the home since 2013.
“There’s definitely a trend of owner-occupiers over investors right now, with only 1 in 10 of our buyers being an investor,” Feeny said
In Cheltenham, a prized location bordering Beaumaris helped a four-bedroom family home at 9 Beverley Street fetch a reserve-topping $1.634 million under the hammer.
Set on a 591 square metre block, the tidy 1950s home was move-in ready. It featured three bedrooms, multiple living areas, and a price guide of $1.4 million to $1.5 million, with a reserve set at $1.5 million.
Bidding opened at $1.4 million with two bidders – both young couples - going head-to-head in a fierce battle for the keys.
“The location is super premium and that’s really what pushed the price up,” said selling agent Kevin Chokshi of Ray White.
“For many young families, it’s not just a house purchase here; it’s a lifestyle investment.”
While it was a fairytale moment for the winning couple, Chokshi said the underbidders’ long hunt would continue.
“They were actually the underbidder on the house next door a year ago. So that’s twice they’ve missed out in the same street now,” he said.
LJ Hooker head of research and economics Matthew Tiller said Melbourne listings were high following a couple of disruptive weekends due to the footy finals.
“That first rate cut will enhance borrowing capacity and bidding power, but prices have softened,” he said.
Shane Oliver, head of investment strategy and chief economist at AMP, said the auction clearance rate could drop as low as 55 per cent in post-weekend revisions which spelled soft conditions for the capital.
“Listings are stronger than normal too which is indicative of distressed sellers. This time last year we had 857 listing,” he said.