I bought a property in Brighton East in 2006 via Metropole Projects, who managed the preparation of plans, and planning permit approval, for two townhouses. Purchase price in 2006 was $750k. I had done a lot of my own research at the time and was quite happy with the purchase.
Fast forward two years. I had my Brighton East property up for auction yesterday. Metropole attended on my behalf, as I live in Perth. I spoke with the auctioneer on Friday to discuss the reserve price. During the discussion, he talked about a drop in Melbourne prices of 20-25% in the last 9-12 months, and a drop of 10-15% in the last three months alone (and he was referring to good suburbs). Now this did shock me—I simply could not believe these numbers. I suspect he was trying to influence my reserve price. So-- how did the auction go?
20-30 people turned up. Auctioneer started it off at $800k. Vendor bid at $850k. Not one bid from the crowd. Given the state of the economy and generally poor sentiment, I suppose I shouldn’t be too shocked. Timing for the auction was not the best. But after two years (with reported stellar growth in good Melbourne suburbs in 2007), plus the added value of a planning permit for two townhouses, I was expecting more (a lot more). In fact I had a bank valuation close to $1M at the start of the year, which closely reflected available sales evidence at the time.
My question to forumites familiar with the Melbourne market: what are your observations on price movements over the last 9 months, and in particular the last three months. Is there some substance to the numbers bandied about by the auctioneer?
Appreciate any response from informed forumites.
Fast forward two years. I had my Brighton East property up for auction yesterday. Metropole attended on my behalf, as I live in Perth. I spoke with the auctioneer on Friday to discuss the reserve price. During the discussion, he talked about a drop in Melbourne prices of 20-25% in the last 9-12 months, and a drop of 10-15% in the last three months alone (and he was referring to good suburbs). Now this did shock me—I simply could not believe these numbers. I suspect he was trying to influence my reserve price. So-- how did the auction go?
20-30 people turned up. Auctioneer started it off at $800k. Vendor bid at $850k. Not one bid from the crowd. Given the state of the economy and generally poor sentiment, I suppose I shouldn’t be too shocked. Timing for the auction was not the best. But after two years (with reported stellar growth in good Melbourne suburbs in 2007), plus the added value of a planning permit for two townhouses, I was expecting more (a lot more). In fact I had a bank valuation close to $1M at the start of the year, which closely reflected available sales evidence at the time.
My question to forumites familiar with the Melbourne market: what are your observations on price movements over the last 9 months, and in particular the last three months. Is there some substance to the numbers bandied about by the auctioneer?
Appreciate any response from informed forumites.