Property investor sells Seddon house for $1.25m, $50,000 below reserve

A property investor sold a charming red brick house in Seddon for $1.25 million after it passed in at its Saturday auction, a $50,000 discount to the published reserve price.

The six-bedroom house at 14 Hobbs Street came with period details such as intricate decorative fretwork in the hallway, a stained-glass entrance and fireplaces.

The property was one of 629 scheduled to go to auction in Melbourne last week. By Saturday evening, Domain recorded a preliminary auction clearance rate of 59 per cent from 416 reported results throughout the week, while 74 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.

It was the first test of the market’s reaction to the Reserve Bank’s fifth cash rate increase for the year last Tuesday, to 4.85 per cent. Although the clearance rate remains at lacklustre levels, it was marginally higher than last week’s early read of 56 per cent, as many buyers already in the market may have factored the rate rise into their budgets.

The Seddon home was for sale with a reserve price of $1.3 million.

At auction, a vendor bid was placed of $1,225,000. But with no further offers forthcoming, the home passed in.

Two parties showed interest after the auction and negotiations ensued. A deal was struck at $1.25 million.

“It is quite a sought-after location where that house is,” Jas Stephens Real Estate selling agent Tate Moore said.

The winners are second home buyers who live locally and may renovate the house, which is set on 300 square metres. Moore said the home had previously been a rooming house and could be returned to its original state.

He said there was a trend towards homes selling in post-auction negotiations, while many homes were also selling prior to auction. He said some buyers wanted to see “social proof” that others were keen on the home.

“They really just want some third-party endorsement that people will put their hand up,” he said.

He was unsure that the latest interest rate rise had had much impact yet, albeit that could change over time.

“Second home buyers … typically they are buying and selling in the same market,” he said.

The home last sold in 2010 for $736,000, records show. The median house price in Seddon was $1.06 million over the 12 months to September, on Domain data.

Elsewhere, in Hampton East, a well-kept, single-level townhouse sold for $1,361,000 to a downsizer.

There were six bidders for the sunny, three-bedroom home at 2/300 South Road, which came with an al fresco entertaining area and a back garden.

Bidding began at $1.1 million, and was quickly increased to the published reserve of $1.2 million. Later, a range of increments were offered, including bids as small as $500.

The winner had seen the home at the first inspection, while the underbidder had seen it only the Thursday prior, Hodges McGrath Sandringham selling agent Angus Graham said. The vendors are downsizing.

He attributed the result to “realistic expectations from the owner. But it was a very well-sized three-bedroom plus study, single level, garage, which was one of those properties that is always popular.”

Although he described the market as challenging, he had sold all his October auctions.

“While we are not having as many auctions, those vendors that are willing to auction are having good outcomes. Realistic sellers are getting rewarded,” he said.

In the northern suburbs, a Mickleham home sold under the hammer for $590,000.

The three-bedroom house at 49 Ginger Crescent was listed at the start of its campaign with a guided price range of $530,000 to $550,000, which was then updated to show a reserve price of $550,000.

Four parties registered for the auction, of whom two participated.

Bidding began at $560,000, already higher than the reserve, and the price rose in a mix of $10,000 and $5000 bids.

A young first home buyer couple renting locally won the keys, while the underbidder was a man hoping to downsize. The vendor is a young man taking the opportunity to upsize.

Ray White Craigieburn selling agent Adrian Prestileo thought the home’s presentation helped it stand out, as well as the affordable price point.

“In times like these, price [and] presentation is the most important thing,” he said.

He also thought the rate rise would have less impact on those who were changing from one home to the next in the same market.

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