Staff reporterDecember 7, 2020
The budget end of Melbourne’s prestige market faces tough challenged, according to Melbourne buyers' agent Nicole Jacobs.
Jacobs defines the entry-level prestige market as between $2.5 million to $3.5 million.
"This gets you a fairly modest family abode in Hampton close to the beach, a single-fronted home in Albert Park that is liveable or a sizeable apartment or, if you are lucky, a townhouse in Toorak," she blogged.
But this section of the market had changed slowly over the past 12 auction weekends.
"Properties that are compromised by way of position or floor plan, are unrenovated or on the wrong side of the street, are finding it tough," she told Domain readers.
"The family home market at this level is very discerning and it is often the buyer’s first big property upgrade.
"Expectations are high and the competition tough.
"They also know when the price does not reflect the value in the area.
The clear message for vendors was "meet the market or be on the market for some time".
"The market is changing and it is now time for buyers to have the upper hand," she says.
Jacobs agrees good properties in this price bracket were still selling well, but the key was getting the price right.
"Get it wrong and the property no longer attracts competition among anxious buyers.
"It is passing in, in many cases on a vendor bid, and then appearing as a private sale with an asking price at or above the original advertised price range.
"Clearly, the only competition is the vendor."
Emma Bloom, from Melbourne buyer's agent Morrell & Koren, told Fairfax Media that auctioneers were pulling out all stops to get the tiny number of bidders to raise their paddles. Many agents were also hitting the panic button and selling before auction.
"If you put in any bid, it's yours," she suggested.
"Everyone's standing around with their hands in their pockets."
But last month following a $9 million sale of a 2000sq m luxury house in Glen Iris, she expressed the opinion: "It was a ridiculous price."
"Whoever says there is a slowdown needs to be watching what's happening in the leafy inner suburbs of Melbourne," she said.
Emma Bloom further claimed many expats fear the Australian property market could become even more competitive and expensive because of record low interest rates and high immigration.
"They are super nervous about the tide going out and being left with nothing," she advised, in an article on the $5 million plus market.
"They fear not having anywhere to live if they don't buy now."
Informed weekend market commentary came from long-established real estate agent Greg Hocking, from Greg Hocking Holdsworth, who suggested it was "a mixed bag at the moment.”
“Buyers are becoming more critical and that is very evident.
"We had a couple of decent sales today, but there were a couple of others where prospective buyers just stood there and did nothing.”
