Maybe it was the only property those people could afford.
Regarding the high participation in OFI's, have you established what type of buyers these people are?
It could be that mum and dad investors have now come out of the woodwork.
Most definitely Bill- it was priced at under $700K (which, for a freestanding house in a quiet street, walk to the train, within the 15km CBD ring is becoming a rarer beast) and some $30K under the current median for this particular suburb, hence the excitement. I'll be watching the auction outcome with obvious interest
Buyers come from all walks - and vary, according to suburb and type of property, naturally. For example, I'm very unlikely to find many investors at $3m North Shore homes whereas units under $500K tend to have a fair smattering of both HB's and investors right now. It's been interesting (but not surprising) to see the no. of investors re-entering the market this year, as so many stayed away due to govt incentives driving the sub $600k price bracket up last year. Momentum really got going between July-Sep, however, as the boost halved and then it was still a scramble for those FHB's finishing up in time for 2010 and their extra $3,500.
BUT.... despite this, there are still FHB's out there who also cooled their heels in anticipation of price drops this year and decided that the artificial stimulation would cool things down a little. Only time will tell if they're correct.
Sydney is a very mixed market, still with wide variations depending on suburb and price range- who knows what is going to happen in terms of growth? None of us. There are no "geniuses" or "gurus" in any investment class, who claim to have the answers. All I can comment on is my property experience and anecdotal ramblings from the field, as with others here who are involved directly in real estate or are serial investors, buying/selling frequently. I do, however, tend to agree with Mark Armstrong (Director of Planning Australia who writes a weekly column in Sun Herald) on two salient points regarding Sydney RE:
1. The earlier you enter the market, the better off you will be.
2. The longer you stay in, the easier it gets.
Sure, there are always going to be exceptions for both of these, and perhaps history will prove such opinions wrong but, in my limited experience of buying RE since 1991, these points ring true. If I didn't believe it, I wouldn't put my money where my mouth is and keep buying property. But I do