‘People are cautious’: North shore pad passes in, then sells at a discount

Investors sold a two-bedroom apartment in Wollstonecraft to a first home buyer post-auction for $1,197,500 after an hour of negotiations on Saturday.

The north-facing flat at 9/13 Belmont Avenue was close to the station and had clean lines and a fresh, modern renovation.

The property was one of 964 scheduled to go to auction in Sydney last week. By Saturday evening, Domain recorded a preliminary auction clearance rate of 49 per cent from 571 reported results throughout the week, while 222 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.

As only one person registered for the Wollstonecraft home and did not make a bid, a vendor bid at the price guide of $1.16 million was placed. The home then passed in.

Negotiations started after the auction and continued until the price of $1,197,500 was achieved. The reserve was $1.21 million.

There is no legal requirement for a vendor’s reserve to be in line with their property’s price guide.

“People are turning up, waiting a bit, and then they make an offer after the auction,” selling agent Stuart Howard from Marriott Lane Real Estate said. “It’s happening quite often.

“People are cautious. Buyers are cautious in how much they’re paying for properties because of the interest rate rises.”

He noted that as the sale is under auction conditions vendors are still pleased with a post-auction sale, the difference is the buyer feels less pressure.

He said the fifth interest rate rise is “definitely affecting things”.

The buyer is a first home buyer who was renting in the inner west. The vendors were investors from the North Shore. The unit last traded for $622,000 in 2013, records show.

In Penshurst, a five-bedroom house at 36 George Street that was marketed as “two homes under one roof” drew interest from parties seeking multi-generational living.

The double brick home with grand proportions was initially guided at $2.2 million and raised to $2.3 million mid campaign following an offer.

Four parties registered and three actively competed for the 40-year-old property. All were upsizers with growing families.

Bidding opened at $2 million and rose in $50,000, $20,000 and $10,000 increments until it sold for $2.4 million, $40,000 above its $2.36 million reserve.

Selling agent Haydon Sacilotto from Ray White Georges River said the attraction was, “very much multi-generational, two families under one roof was kind of the main marketing ploy”.

“The home was pretty unique in the sense that it … was kind of two homes under one roof … It is pretty rare to come across a house that has two kitchens within the actual main residence,” he said.

Sacilotto said despite the recent rate rises he wasn’t concerned about the auction as several buyers had expressed their interest.

The buyers are upsizing from Panania and plan to do some renovation work. The vendors are both in a nursing home.

In Crows Nest a two-bedroom character filled semi at 100 Atchison Street guided at $1.8 million sold for $1.92 million.

Three registered and two locals participated for the century-old charming opportunity. All were downsizers. There was initial interest from first home buyers but they didn’t proceed to auction.

Bidding opened at $1.8 million which was also its reserve and quickly rose in $20,000 and $10,000 increments.

At $1.9 million the underbidder placed a $5000 bid but then the purchaser raised the stakes by $15,000 making the price $1.92 million where it sold under the hammer.

Stone Real Estate’s Jimmy Psaltis said, “It went the way an auction should.”

Despite the rate rise he wasn’t concerned as he had “two that were engaged from the first open. So I expected them there, and they delivered.”

Auctioneer Ed Riley said the result, “demonstrates that buyer demand hasn’t disappeared, it’s simply becoming more selective”.

The buyers of the deceased estate were from the North Shore.

Chief economist at AMP, Dr Shane Oliver said Domain’s clearance rate of 49 per cent for Sydney is “fairly stable” but still “extremely weak”.

“One thing helping the clearance rate is that listings are still well down on a year ago,” he said.

“So, the fall in listings is helping prevent a more significant further fall in the clearance rate, so demand is down, but supply is also down.”

Oliver said every time the interest rate rises there is a potential for distressed sales. “People are holding on … vendors at present aren’t in a big hurry to sell,” he said, adding there are also high levels of withdrawals.

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