The state of the $3 million-plus property market: Mal James

At the time of my last blog post, the fridge door had opened on the market and the mood was a little sombre.

July hasn’t really given us any more pointers as to where things are going, given that – as you would expect – there has been such a small number of transactions.

In our opinion, right now the overall million dollar-plus market is about as exciting in terms of stock quality as an Opp Shop – lots of junk and the occasional gem.

For example, at 97 Page Street, Albert Park, 80 people showed up to the auction by Greg Hocking. It was bought under the hammer for $990,000 with three bidders.

Meanwhile, just down the road in Elwood there were two auctions – at 15 Kingsley Street and 38 Byrne Avenue. Our reporters turned up at both these auctions, but no one else did except for the auctioneer. Consequently, there were no bids and no action.

We consider $80-100 million-plus auctions a good solid weekend in Bayside and the inner east.

Last weekend we could only find around 30.

Only a handful tipped the excitement scale above lukewarm and a few didn’t even make the $1 million mark.

This weekend the numbers are not much better, with just under 40 auctions.

However, the following week, August 11, we are getting back to normal, in this lower stock year, with around 70 auctions scheduled in the million dollar-plus price segment.

So we are keeping our overall market opinions to ourselves – other than to say she is pretty quiet and unexciting by any measure, but that this is not completely unexpected.

Things have also been quiet at the $3 million-plus price level in all areas during the month of July. This is fairly understandable given that:

1. Many agents who sell at this price level are in Europe or elsewhere during July.
2. Given the winter school holidays, this time is historically as quiet as January in terms of $3 million-plus family home action – meaning almost nil.

With the Olympics as a market-perceived interrupter, it doesn’t look like things are going to hot up in a hurry much before the start of the AFL footy finals, when traditionally spring brings those first buds of $3 million-plus homes out onto the market.

Having said that, there was some limited action in July and here are three interesting homes that show the price vagaries of the market with regards to the current 2007 to 2012 cycle.

• Brighton, 16 Albert Street, with Andrew Urquhart of JP Dixon – sold for around the mid-$3 million. This was a new home, a couple of hundred of metres from the beach on almost a 1,000 square metres of land. The 2012 price represents a decrease on the early 2008 sale (start of GFC) of around 6%.

• Balwyn North, 1 Cascade Street, with Andrew Keleher of Jellis Craig – bought for around $3 million. This had an older style front with ultra modern extension on 800-plus square metres. It’s been on the market for a few months with this agent. It was a strongish price for the area, despite the fact other agents had been asking in the mid-$3 millions for it recently. The 2012 price represents a 10% increase on the late 2007 sale price, which shows there is still some life left under the right circumstances.

• Canterbury, 34 Maling Road, with Tom Ryan of Jellis Craig – on a big block of land and tennis court (3,000-plus square metres), this period home had potential but was in need of renovation (James Home Rating 626/1000). It sold for, we believe, around $4 million. If this was the case then it was almost exactly the same price as two years ago when it last went to market.