Halfway 2018: who won? And who cut a loss?
Halfway through 2018, the Sydney property market has seen a shake up. We’ve had ups. And we’ve had downs too.
No one likes to talk about the elephant in the room so let’s get that out of the way early. Last month, major banks were tipping the Sydney and Melbourne markets to shave 10%. Those predictions are now for small dips to continue in 2018, and a touch more, or flatter, next year.
But for those making moves now, price corrections are old news.
Since late last year, vendor price appraisals have included the message: ‘this was your expected price six months ago… and this is your price now.’ Competition made way for levelheadedness some time ago.
Without drawing a map, there are plenty of examples.
Prices come down
At the start of the year we saw an Alexandria warehouse pad sell for around $1.7 million. It was bought a year earlier for $1.6 million. When you consider fees and holding costs, that’s a break-even transaction. It would be tough to find one of those in the previous five years.
An identical apartment bought for $1.7 around the same time, is now on market asking $1.6 million – a $100,000 dip before costs.
Recently a 2017 purchase of $2.8 million hit the market in Balmain for much less. At the auction we heard one neighbour mutter, “Prices haven’t come off that far, have they?” Moments later it sold for $2.45 million – a $500,000 haircut with costs factored in.
At the same time, the famous blue-chip Wharf Road was also pulling back. Considered the best street on the Balmain Peninsula, one particular residence sold for around $2.6 million last year. This year, it was on-sold for $2.4 million.
Speaking to the vendors after auction, they said they wanted it gone and were happy to move it on, especially after trying to sell last December without any bidders.
The ‘untouchable’ city fringe can also throw surprises. A house in Forest Lodge recently sold for $1.8 million. It was bought for $2.1 million 11 months earlier with bidders fighting for it.
Despite what the headlines have told us along the way, Sydney isn’t always a sure thing. But amid the dips, an array of buyer appetite has propped up 2018 sales.
People = prices
Balmain has also been home to our most popular and most clicked-on properties. A futuristic cottage renovation, that one sold for $2.3 million after being marketed for $2.2 million. Buyers were keen on its nothing-to-spend frills.
The same happened in Perry Street, Marrickville where local buyers were wary about spending more than $1.15 on a townhouse. But when some Eastern Suburbs’ buyers were introduced to the property the parties brought different opinions on value, offering $1.25m.
Rather than comparing offerings in the same street, these cross-town buyers still bring wider viewpoints around ‘value’, even in cooler markets.
The power of good design
With clusters of cookie-cutter apartments, Pyrmont is difficult in tough times. Yet a more unique warehouse apartment in Harris Street’s ‘M Central’ delivered a fiery auction for 2018 standards. With six registered bidders, it was one of our only properties with multiple buyers at exactly the same level.
Two of the under-bidders both went on to buy two other units in the block, spurred on with the interest seen that day. A coup for design.
Architect Alec Tzannes saw the notions of ‘good design’ tested further. He bought an architect-devised (by him) home last year for $3.66 million. Four months later, he sold it for $300,000 more.
“Even though we were presented evidence of the market cooling, I strongly believe that good products will stand the test of time,” he said. “I’d like to think this is an example of the marketing… of the market being made aware of the types of qualities a house has so that when buyers are looking they can see the difference.”
Other windows of opportunity
More examples of solid prices do still exist. In Hornsey Street, Rozelle, a one-bedroom apartment, sold in 14 days for $610,000. Another sale in the same building during fetched $581,000 elsewhere last year, (in a better market). The presentation/styling/creative got attention here, quickening the sale and fetching $29,000 more in seven months.
Another one you’d attribute to people’s connection with marketing was in Grove Street Dulwich Hill. It was listed elsewhere for three months and failed to find a buyer. When it was presented via our off-market platform it sold in one week. Perhaps informed buyers make faster choices, and less marketing is more.
One-buyer auctions have been rife, happening to this poolside home in Pidcock Street, Camperdown. A buyer who followed the entire campaign didn’t register. Another bidder didn’t partake. And the only remaining bidder had seen the home three days before auction. It still sold for $2.5 million.
Other unique homes have still got hearts racing. A Spanish Mission-style terrace in Paddington sold for $4.5 million – $750,000 above a well-considered reserve. Even at that price point, the individuality (250sqm block and an 11.7m frontage) was enough to draw out seven registrations and three active bidders.
Then again, a freestanding residence on 316sqm in Randwick was pretty distinctive, yet buyers were hard to impress. What would have sold for between $2.5 and $2.7 million last year saw multiple price adjustments before being withdrawn from the sale. A day later it sold for $2.31 million.
That one had around 100 groups view the home, and plenty of follow-up inspections. Inexplicable.
It’s a jungle out there, set to bewilder us. And we’re only halfway in.