Two vendors in Sydney’s inner west were forced to cut their reserve prices to sell homes at auction on Saturday as buyers worried about overpaying in the weakening market. The slow grind on auction floors came as Sydneysiders know property prices are falling, down 11.5 per cent in the last year on Domain data, and sometimes face a mismatch between the expectations of buyers and sellers.
Two Victorian terraces were up for grabs in Forest Lodge, near Glebe, but the first dragged out for almost a marathon hour, giving the crowd barely enough time to rush to the second auction that was about to start. They were among 451 auctions held in Sydney on Saturday. By evening, Domain Group had recorded a 62.2 per cent clearance rate from 223 reported results.
A late-developing crowd formed for the auction of the three-bedroom property at 126 Hereford Street and auctioneer Jason Andrews’ long spiel to galvanise the audience fell flat when he was met with complete silence. “That was unbelievably anti-climactic,” Mr Andrews said. After another attempt to cajole bidders, he submitted a vendor bid of $2 million to get the auction under way.
One of the five registered bidders put in a counter offer of $2.05 million before the auctioneer paused for private negotiations with the vendor, the first of three such breaks in proceedings. “It’s like drawing blood,” said one onlooker. Mr Andrews returned and convinced the same party to bid against himself, raising the price to $2.15 million. After a second party threw their hat in the ring, and a slow grind of bids in increments of $10,000 and $5000, the hammer eventually fell at $2.26 million with the first bidder nabbing the keys.
The vendor’s initial reserve of $2.35 million was adjusted down to $2.25 million during negotiations in order to seal the deal on the day. Selling agent James Peach of Ray White Taylor and Partners said drawn out auctions were common in the current market, showing the importance of selling under the hammer. “Whether it takes two hours or 15 minutes, you need that time to make sure you get the result done,” Mr Peach said. “Looking at all the statistics and everything else, if it passes in it’s a lot harder to reach the level it passed in at.” The 233-square-metre property last sold for $400,000 in 1995.
Nearby at 178 Hereford Street, two bidders threw their hat in the ring for the three-bedroom terrace. This time it was enough to kick off the sale with an opening bid of $1.4 million. But it too suffered a similar fate, with negotiations, albeit shorter this time, stalling the auction at $1.72 million after a series of $5000 and $1000 bids.
It sold for $1.8 million to a local buyer overseas. The vendors dropped their initial reserve of $1.85 million by $50,000 in negotiations to sell under the hammer. “They’re a demonstration of where we find ourselves,” Mr Andrews said of both auctions. “We’ve got really healthy levels of registrations, but despite [that] there’s some toing and froing that needs to happen.” The 164-square-metre property last sold for $820,000 in 2004.
Meanwhile, in the upper north shore a four-bedroom deceased estate sold $200,000 above reserve for $1.12 million. Three of the four registered bidders threw their hat in the ring for 302 Pittwater Road in East Ryde. Selling agent George Gialouris of Belle Property Hunters Hill said it was an active auction with an opening offer of $750,000.
A family nabbed the keys to property, hoping to build their dream home. In Sydney’s south-west, eight first-home buyers were vying for the keys to another deceased estate, this time in Belmore. Bidding opened at $600,000 for 15A Lucerne Street and increased in $10,000 increments. It sold for $720,000 to a young family from Annandale. Selling agent Adrian Tsavalas of McGrath Newtown said it was a very strong result for a property in original condition.
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Author: Tawar Razaghi