Underquoting and jaded buyers

[Big Will]

http://www.realestate.com.au/property-house-vic-watsonia-119490679

This was quoted 460-500k, without even researching (as I live around the corner) I knew it would sell in the mid 500s.

Reason being http://www.realestate.com.au/property-house-vic-watsonia-115011551 sold for 537k in Nov 2013.

For me to find the link of the other sold price it took me less than 1 minute using google.

Given that I am not a usual buyer people really need to do their own DD and not rely on others.

Even when you get advice from someone you should still make your own decisions. Like if my doctor said I was going to die in the next month from cancer would I take their word and sell everything and party... No I would go seek another doctors advice. If both said roughly the same then I would consider my options.

 

[BayView]

Looking at a place for private sale quoted $2.6m+

So I offered $2.8. Vendor rejected it and wants $3.3m

On that;

We currently have our own PPoR on the market. Been on the market since April 1.

A similar house sold not long before this (in a more "prestige" section of the suburb) for $2.2m, with no garage (single carport), no pool or spa, but had a butler's pantry. Good views of course.

It was originally offered at $1.8m, and sat on the market for several months, then 2 buyers became interested at the same time, bidding war ensued and sold for the above figure.

Now; going back a couple of months before this occurred, a local agent gave us his appraisal for our house - $1.5m-$1.6m, but may go higher depending on buyer, etc...

Fast forward a bit to after this other sale, and we reckon our joint may even be worth closer to $1.7m - $500k less than the other place is not unreasonable to expect (we reckon our place is as good, of course )

So, we discuss selling our place, and his strategy is to offer a "price plus".

Based on his recent appraisal, and what the other place sold for compared to our place, position etc, and what we want to sell it for to clear debts, make some sort of reward for effort for ourselves, and to cover his commission, etc, we reckon a sale price of no less that $1.65m.

So, he reckons we offer it at $1.45 plus. WTF?

His reasoning is he can create more interest and work on the buyers to get them up.

I seriously questioned the success of this strategy to start this low, and I told him I reckon we are wasting everyone's time at that figure, and we should start at no less than $1.55m plus.

So what has happened?

Only the buyers who can go up to $1.5m are showing interest

So, it's not always the Vendor who is the problem.

 

[CM_]

GDay everyone,

(I might lead this topic a little astray here)

I too am going through the battle of $500k+ suggested priced properties going for $250k more at auction, yet only passing the reserve at $700k. Its super frustrating and Im sure there is issues on both sides ie. agents underquoting and vendors incorrectly price matching to what they think are 'similar' sales in the area. (My experience of this is primarily from Melbourne inner east and Bayside suburbs, although Ive also seen similar occurrences to a lesser extreme in other south eastern suburbs)

Id like to get everyones thoughts:
Is it going to be worth it longer term for buyers as an investment? or is this seller strategy creating an over capitalisation so to speak.

Im keen to get into the market and I do realise a house is only worth as much as someone is willing to pay for it. However after putting in offers (even at the top of the asking range) and being knocked back with the suggestion they want $75k-$100k more (minimum) seems a bit nuts to me.

Also any thoughts on countering from a buyers perspective (i dont think theres really any leverage to use) beyond walking away or aiming at properties $100k less to balance out the situation?

 

[BayView]

GDay everyone,

(I might lead this topic a little astray here)

I too am going through the battle of $500k+ suggested priced properties going for $250k more at auction, yet only passing the reserve at $700k. Its super frustrating and Im sure there is issues on both sides ie. agents underquoting and vendors incorrectly price matching to what they think are 'similar' sales in the area. (My experience of this is primarily from Melbourne inner east and Bayside suburbs, although Ive also seen similar occurrences to a lesser extreme in other south eastern suburbs)

Id like to get everyones thoughts:
Is it going to be worth it longer term for buyers as an investment? or is this seller strategy creating an over capitalisation so to speak.

Im keen to get into the market and I do realise a house is only worth as much as someone is willing to pay for it. However after putting in offers (even at the top of the asking range) and being knocked back with the suggestion they want $75k-$100k more (minimum) seems a bit nuts to me.

Also any thoughts on countering from a buyers perspective (i dont think theres really any leverage to use) beyond walking away or aiming at properties $100k less to balance out the situation?

At that price level in those suburbs there will be huuuge demand right now...cheaper end, and highly sought after areas.

This strategy when used in high demand areas and especially now while the interest rates are low, and buyer emotion is high, is a winner; it creates interest for the r/e's, and competition from the buyers.

The r/e's will play the interested buyers off against each other - just like at an auction; only this becomes more of a private auction scenario.

A house around the corner from us was advertised at $950k+ a few weeks ago, and there were several interested parties - sold for $1.2m.

 

[Jacque]

GDay everyone,

(I might lead this topic a little astray here)

I too am going through the battle of $500k+ suggested priced properties going for $250k more at auction, yet only passing the reserve at $700k. Its super frustrating and Im sure there is issues on both sides ie. agents underquoting and vendors incorrectly price matching to what they think are 'similar' sales in the area. (My experience of this is primarily from Melbourne inner east and Bayside suburbs, although Ive also seen similar occurrences to a lesser extreme in other south eastern suburbs)

Id like to get everyones thoughts:
Is it going to be worth it longer term for buyers as an investment? or is this seller strategy creating an over capitalisation so to speak.

Im keen to get into the market and I do realise a house is only worth as much as someone is willing to pay for it. However after putting in offers (even at the top of the asking range) and being knocked back with the suggestion they want $75k-$100k more (minimum) seems a bit nuts to me.

Also any thoughts on countering from a buyers perspective (i dont think theres really any leverage to use) beyond walking away or aiming at properties $100k less to balance out the situation?

My advice and to all here who have experienced under quoting and want to do something about this annoying practice is to dob the re-offending agents into the OFT (you can do so anonymously via their complaint form- NSW one is here https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

Secondly, it's vital to note that the penalties for this practice falls under both the PSBAA and Regulation as well as the ACL (Aust Consumer Law) Agents can be penalised for deliberately misleading consumers and this includes purchasers of real estate. Guidelines were again recently released from the NSW OFT here

https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

The important issue is not what the price difference is between the quoted price/range supplied and the final sale price or even reserve (as this is often set by the vendor, who has no liability), but if there was a discrepancy between the price/range supplied and the listing agreement estimation:

From the guidelines: "NSW Fair Trading considers an agent to be falsely
understating the estimated selling price of a property by
making or publishing a statement when marketing the
property that is less than their true estimate of the selling
price"

In other words, if it can be found that the estimation on the selling agreement is more than what was provided to consumers as the guide, then there is a case for misleading and/or deceptive conduct.

If more consumers contacted OFT with these breaches agents would be more careful, however it's no good complaining and doing nothing about such breaches. Quoting $1.3K+ is all well and good if the listing agreement states the same however if it doesn't (eg: Estimation is $1.4-1.5m) then there could be grounds for an offence.

Why wouldn't agents simply put a lower estimation price on their listing agreement then? I've heard people ask. Agents also have an obligation, under Sec 74 of the PSBAA to provide a fair and substantiated estimated selling price or range on the listing agreement with the vendor. After all, selling agents should be able to know the market sufficiently well (in most cases) or they aren't doing their job properly. If a consumer has reason to believe that an estimation is incorrect or lower than market and has been provided on the listing agreement, then OFT may also investigate the agent to provide evidence of how they arrived at that estimation in the first place. See page 5 of the Guidelines Document above.

Of course it's easy for more experienced investors/buyers in an area to say "You need to know the market", "Ignore the price guides and do your own research", "You shouldn't be looking if you don't know what a property's worth or likely to sell for" etc however I also think it's vastly unfair to have to put up with those agents who continue to knowingly mislead buyers and blame the "greedy vendors" when the agents are as much to (if not completely) the cause here.

 

[Big Will]

My advice and to all here who have experienced under quoting and want to do something about this annoying practice is to dob the re-offending agents into the OFT (you can do so anonymously via their complaint form- NSW one is here https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

Secondly, it's vital to note that the penalties for this practice falls under both the PSBAA and Regulation as well as the ACL (Aust Consumer Law) Agents can be penalised for deliberately misleading consumers and this includes purchasers of real estate. Guidelines were again recently released from the NSW OFT here

https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

The important issue is not what the price difference is between the quoted price/range supplied and the final sale price or even reserve (as this is often set by the vendor, who has no liability), but if there was a discrepancy between the price/range supplied and the listing agreement estimation:

From the guidelines: "NSW Fair Trading considers an agent to be falsely
understating the estimated selling price of a property by
making or publishing a statement when marketing the
property that is less than their true estimate of the selling
price"

In other words, if it can be found that the estimation on the selling agreement is more than what was provided to consumers as the guide, then there is a case for misleading and/or deceptive conduct.

If more consumers contacted OFT with these breaches agents would be more careful, however it's no good complaining and doing nothing about such breaches. Quoting $1.3K+ is all well and good if the listing agreement states the same however if it doesn't (eg: Estimation is $1.4-1.5m) then there could be grounds for an offence.

Why wouldn't agents simply put a lower estimation price on their listing agreement then? I've heard people ask. Agents also have an obligation, under Sec 74 of the PSBAA to provide a fair and substantiated estimated selling price or range on the listing agreement with the vendor. After all, selling agents should be able to know the market sufficiently well (in most cases) or they aren't doing their job properly. If a consumer has reason to believe that an estimation is incorrect or lower than market and has been provided on the listing agreement, then OFT may also investigate the agent to provide evidence of how they arrived at that estimation in the first place. See page 5 of the Guidelines Document above.

Of course it's easy for more experienced investors/buyers in an area to say "You need to know the market", "Ignore the price guides and do your own research", "You shouldn't be looking if you don't know what a property's worth or likely to sell for" etc however I also think it's vastly unfair to have to put up with those agents who continue to knowingly mislead buyers and blame the "greedy vendors" when the agents are as much to (if not completely) the cause here.

Cause this happens...

http://somersoft.com/forums/showthread.php?t=108492

extract:
Before the auction the opens were disappointing, much less people than after. And I think it's because he was giving a price guide of well too much (800,000) so they thought it would go in auction for 900,000 at least so didn't bother.

 

[littletee]

My advice and to all here who have experienced under quoting and want to do something about this annoying practice is to dob the re-offending agents into the OFT (you can do so anonymously via their complaint form- NSW one is here https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

Secondly, it's vital to note that the penalties for this practice falls under both the PSBAA and Regulation as well as the ACL (Aust Consumer Law) Agents can be penalised for deliberately misleading consumers and this includes purchasers of real estate. Guidelines were again recently released from the NSW OFT here

https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/GeneralForm.html

The important issue is not what the price difference is between the quoted price/range supplied and the final sale price or even reserve (as this is often set by the vendor, who has no liability), but if there was a discrepancy between the price/range supplied and the listing agreement estimation:

From the guidelines: "NSW Fair Trading considers an agent to be falsely
understating the estimated selling price of a property by
making or publishing a statement when marketing the
property that is less than their true estimate of the selling
price"

In other words, if it can be found that the estimation on the selling agreement is more than what was provided to consumers as the guide, then there is a case for misleading and/or deceptive conduct.

If more consumers contacted OFT with these breaches agents would be more careful, however it's no good complaining and doing nothing about such breaches. Quoting $1.3K+ is all well and good if the listing agreement states the same however if it doesn't (eg: Estimation is $1.4-1.5m) then there could be grounds for an offence.

Why wouldn't agents simply put a lower estimation price on their listing agreement then? I've heard people ask. Agents also have an obligation, under Sec 74 of the PSBAA to provide a fair and substantiated estimated selling price or range on the listing agreement with the vendor. After all, selling agents should be able to know the market sufficiently well (in most cases) or they aren't doing their job properly. If a consumer has reason to believe that an estimation is incorrect or lower than market and has been provided on the listing agreement, then OFT may also investigate the agent to provide evidence of how they arrived at that estimation in the first place. See page 5 of the Guidelines Document above.

Of course it's easy for more experienced investors/buyers in an area to say "You need to know the market", "Ignore the price guides and do your own research", "You shouldn't be looking if you don't know what a property's worth or likely to sell for" etc however I also think it's vastly unfair to have to put up with those agents who continue to knowingly mislead buyers and blame the "greedy vendors" when the agents are as much to (if not completely) the cause here.

Nice in theory but in reality they probably investigate .00001% of cases, it's all lip service!

 

[BayView]

On that;

We currently have our own PPoR on the market. Been on the market since April 1.

A similar house sold not long before this (in a more "prestige" section of the suburb) for $2.2m, with no garage (single carport), no pool or spa, but had a butler's pantry. Good views of course.

It was originally offered at $1.8m, and sat on the market for several months, then 2 buyers became interested at the same time, bidding war ensued and sold for the above figure.

Now; going back a couple of months before this occurred, a local agent gave us his appraisal for our house - $1.5m-$1.6m, but may go higher depending on buyer, etc...

Fast forward a bit to after this other sale, and we reckon our joint may even be worth closer to $1.7m - $500k less than the other place is not unreasonable to expect (we reckon our place is as good, of course )

So, we discuss selling our place, and his strategy is to offer a "price plus".

Based on his recent appraisal, and what the other place sold for compared to our place, position etc, and what we want to sell it for to clear debts, make some sort of reward for effort for ourselves, and to cover his commission, etc, we reckon a sale price of no less that $1.65m.

So, he reckons we offer it at $1.45 plus. WTF?

His reasoning is he can create more interest and work on the buyers to get them up.

I seriously questioned the success of this strategy to start this low, and I told him I reckon we are wasting everyone's time at that figure, and we should start at no less than $1.55m plus.

So what has happened?

Only the buyers who can go up to $1.5m are showing interest

So, it's not always the Vendor who is the problem.

Update: as you'd expect; only tyre kickers and those with not enough funds are circling. No other offers.

Had a significant blue with the agent the other day; he called for a meeting (to condition us down, no doubt) and I said; "Yep; come and we'll talk"...

Told him he's stooged us, and wasted everyone's time and my money (for board out front, internet listing, photos etc), and should have been honest from day one;

"If you reckon we were aiming too high; you should have been honest up front and refused to take on the listing...you said "$1.5-$1.6 and who knows?"" etc.

So, we've told him to take down the sign out the front, no more opens for inspections (only private inspections) and change the listing to $1.7m.

He's p!szed of course; thinks we are dreaming, no doubt.

We probably are to a degree, but based on the one sold, and a couple more now on the market in the $1.5m plus range, and his original estimate (plus our own reconnaissance of the area's values, etc); it's worth a try - can't be any worse than his disaster so far....and I told him this.

 

[Tonibell]

Update: as you'd expect; only tyre kickers and those with not enough funds are circling. No other offers.

Had a significant blue with the agent the other day; he called for a meeting (to condition us down, no doubt) and I said; "Yep; come and we'll talk"...

Told him he's stooged us, and wasted everyone's time and my money (for board out front, internet listing, photos etc), and should have been honest from day one;

"If you reckon we were aiming too high; you should have been honest up front and refused to take on the listing...you said "$1.5-$1.6 and who knows?"" etc.

So, we've told him to take down the sign out the front, no more opens for inspections (only private inspections) and change the listing to $1.7m.

He's p!szed of course; thinks we are dreaming, no doubt.

We probably are to a degree, but based on the one sold, and a couple more now on the market in the $1.5m plus range, and his original estimate (plus our own reconnaissance of the area's values, etc); it's worth a try - can't be any worse than his disaster so far....and I told him this.

Part of the issue seems to be that the agent said $1.5 - $1.6M so you then thought "minimum $1.65M".

It sound like the low $1.5s was there - which is in the estimated range - but your expectations have increased.

If you are only a seller at top dollar then that is your right - but the agent seems to have done pretty much what could be expected.

 

[jim1964]

He's p!szed of course; thinks we are dreaming, no doubt.

I wouldn't care less if he is ******** Off in the same situation.You are the customer,the boss and you are paying his commission,effectively his wages.Law upon themselves some of them,good on you for challenging his ethics and credibility.Kudos to you Brother.

 

[Ace in the Hole]

Bayview, you got to find an agent who is completely sold on your property/product.
If he doesn't truly believe it's worth your ask, then he's only pretending to potential buyers and they'll see straight through him, and he's not going to get the job done as it should be.

 

[BayView]

Part of the issue seems to be that the agent said $1.5 - $1.6M so you then thought "minimum $1.65M".

Not initially; we had decided that in the middle ($1.55m) was fair and reasonable (given his opening statement), not allowing for a couple of emotional buyers who might fight over it - hopeful of course; but it happens every week as we know.

He did say; "and who knows?" which eluded to the possibility of the above scenario occurring - and it did exactly that in the next few weeks after this conversation with two other properties close by - one was advertised for $950+ and sold for $1.25m, and the other was advertised at $1.8m+ and sold for $2.2m.

The $2.2m property is very similar to ours; but no pool or spa, no garage, almost no back yard ad so on. But other features we don't have (butler's pantry for eg. $600k more for a butler's pantry?)

These happened before we met again and signed with the agent. We knew about these two results, and he brought them up at the next meeting as comparables.

So, based on those two developments, the feeling was $1.6m would be achievable. Our aim was to get $1.65m, and cover all costs, leaving $1.6m for us. Not unreasonable given recent events, and two IR drops into the mix.

My feeling was a price guide of $1.55m+.

The agent suggested $1.45m+

When the one buyer we had offered $1.225m, I said they'd have no hope of getting him up to the level required.

His response was: "This buyer has done his homework and has seen that most of the places in the area are selling for around the $1.2m mark..."

Now; this statement tells me that they either f*cked up on their estimate (they agreed with us initially that the pricing was about right at $1.55m+),

OR, they knew all along that a $1.5m range was impossible - and chose not to divulge that - else they would lose/never get the listing.

Anyway; it's of no consequence; we would like to sell it of course to get us out of our cashflow predicament, pay out the debts and get a life back (and will still own the IP and the business), but we can soldier on as we've been doing.

We won't be giving it away for next to nothing on top of what it owes us.

 

[Big Will]

The $2.2m property is very similar to ours; but no pool or spa, no garage, almost no back yard ad so on. But other features we don't have (butler's pantry for eg. $600k more for a butler's pantry?)

My feeling was a price guide of $1.55m+.

The agent suggested $1.45m+

When the one buyer we had offered $1.225m, I said they'd have no hope of getting him up to the level required.

His response was: "This buyer has done his homework and has seen that most of the places in the area are selling for around the $1.2m mark..."

Now; this statement tells me that they either f*cked up on their estimate (they agreed with us initially that the pricing was about right at $1.55m+),

OR, they knew all along that a $1.5m range was impossible - and chose not to divulge that - else they would lose/never get the listing.

1. How long ago did the place sell for 2.2M there has to be a reason the place sold for 600k more which it only had a butlers pantry but lacked pool/spa, backyard and garage. If yours had all the above but lacked butlers pantry well yours should be worth over 2.2M but you are struggling to obtain 1.5M so something doesn't add up.

2. The agent telling you the prices of 1.8M but sold for 2.2M means they underquoted (another discussion) but they got lots of people interested which pushed the price to 2.2M. I am sure they would of had less interest if they advertised it at 2.1M+. The agent was trying to stir up extra competition at 1.45M+ as people might think lows 1.5M where as 1.55M+ would tell me 1.7-1.8M hence lack of interest/offers.

3. What comparables did the guy use for the 1.2M for his offer, did you review it?

4. Who spoke first about 1.55M being an acceptable price, did you say we want over 1.5M or something and they just agreed? If so they were agreeing to get the listing cause if they said you will be lucky to get 1.5M and we see it more at 1.2-1.3M 99.9% the time the vendor will tell the REA to get lost and hire the person that say 1.6-1.7M.

Good luck with the sale though!

 

[Tonibell]

Anyway; it's of no consequence; we would like to sell it of course to get us out of our cashflow predicament, pay out the debts and get a life back (and will still own the IP and the business), but we can soldier on as we've been doing.

We won't be giving it away for next to nothing on top of what it owes us.

You are right to wait for the right buyer if you are not comfortable with the offers so far.

It is a magnificent place and the views make it very unique.

Hope you get the result you are after.

 

[Deltaberry]

On that;

We currently have our own PPoR on the market. Been on the market since April 1.

A similar house sold not long before this (in a more "prestige" section of the suburb) for $2.2m, with no garage (single carport), no pool or spa, but had a butler's pantry. Good views of course.

It was originally offered at $1.8m, and sat on the market for several months, then 2 buyers became interested at the same time, bidding war ensued and sold for the above figure.

Now; going back a couple of months before this occurred, a local agent gave us his appraisal for our house - $1.5m-$1.6m, but may go higher depending on buyer, etc...

Fast forward a bit to after this other sale, and we reckon our joint may even be worth closer to $1.7m - $500k less than the other place is not unreasonable to expect (we reckon our place is as good, of course )

So, we discuss selling our place, and his strategy is to offer a "price plus".

Based on his recent appraisal, and what the other place sold for compared to our place, position etc, and what we want to sell it for to clear debts, make some sort of reward for effort for ourselves, and to cover his commission, etc, we reckon a sale price of no less that $1.65m.

So, he reckons we offer it at $1.45 plus. WTF?

His reasoning is he can create more interest and work on the buyers to get them up.

I seriously questioned the success of this strategy to start this low, and I told him I reckon we are wasting everyone's time at that figure, and we should start at no less than $1.55m plus.

So what has happened?

Only the buyers who can go up to $1.5m are showing interest

So, it's not always the Vendor who is the problem.

Haha how funny I am trying to sell something agents tell me around 1.5m and told me to quote 1.3m plus.

 

[BayView]

1. How long ago did the place sell for 2.2M there has to be a reason the place sold for 600k more which it only had a butlers pantry but lacked pool/spa, backyard and garage. If yours had all the above but lacked butlers pantry well yours should be worth over 2.2M but you are struggling to obtain 1.5M so something doesn't add up.

Sold in Dec, settled in March. We listed ours on April 1. To be honest; the 2.2 place was a surprise...had little interest for a few months, then all of a sudden two parties wanted it and the fight was on. The location is more in the "Cliftop" section of the town, but still not far from us.

Here it is. Made an error; sold for $2,127,500
http://www.realestate.com.au/property-house-vic-dromana-118395531

Here's our joint;
http://www.realestate.com.au/property-house-vic-dromana-119459303

2. The agent telling you the prices of 1.8M but sold for 2.2M means they underquoted (another discussion) but they got lots of people interested which pushed the price to 2.2M. I am sure they would of had less interest if they advertised it at 2.1M+. The agent was trying to stir up extra competition at 1.45M+ as people might think lows 1.5M where as 1.55M+ would tell me 1.7-1.8M hence lack of interest/offers.

Yep. That was the strategy we discussed and he recommended based on recent events...but when he came back with the comment about the $1.25m offer, I smelled the rat. There was never at any point in all the discussions a price of $1.25m - or that we should look anywhere near that low.

If there had been, we would not have bothered to go any further with discussions about selling and signing the Authority.

3. What comparables did the guy use for the 1.2M for his offer, did you review it?

No, we did not discuss much detail about the offer with the agent.. there are a few places on the market in that range, and without seeming like the biased and delusinal Vendor; the amenities are not the same/as good. The agent called me out of courtesy to let me know about the offer; knowing that it was miles too low, and I told him this bloke was wasting everyone's time.

4. Who spoke first about 1.55M being an acceptable price, did you say we want over 1.5M or something and they just agreed? If so they were agreeing to get the listing cause if they said you will be lucky to get 1.5M and we see it more at 1.2-1.3M 99.9% the time the vendor will tell the REA to get lost and hire the person that say 1.6-1.7M.

There were no other agents involved.

The agent made the first price range estimate several weeks earlier. He rang us out of the blue and asked if he could come and see the house as he hadn't seen it since we built it. He made the $1.5-1.6m statement during that casual visit - we hadn't even decided to sell at that point.

He was the agent that sold our previous PPoR, and knew our plans to build this new one back then. Interestingly; he thought we would only get about $750k for that place, we reckoned we'd get about $900k, and that's what we listed it at against his wishes. It sold for $850k.

Good luck with the sale though!

Thanks BW. We have no doubt we will get the figure sooner or later - just in the last week two more properties close by have been listed at $1.5m+

 

[andrew_de_a]

The house that sold for 2.1m is on 400sqm more land than yours

 

[BayView]

The house that sold for 2.1m is on 400sqm more land than yours

Yes. Where we live up on the hill, there is no subdivision allowed, and many of the blocks have slopes of varying degrees, so only one dwelling and more limited use of the land. The Cliftop place has a fair amount of unusable land due to slope degree.

From our experience (we have lived here for 15 years except for 3 years in the USA), the size of the block becomes academic to a large degree.

For eg; this one for $1.5m+ on 829sq/m:

http://www.realestate.com.au/property-house-vic-dromana-119746439

There are blocks higher up the hill than us, which are soo sloped it is scary. They are bigger, but much of the land - especially if they are on the high side of the road - are just scrub from the house down to the road. Some folks have landscaped these areas, but the cost is huge to do it well...most don't bother. And of course; the driveways are quite long. The value of these houses and land are not much different to something of our land size.

It's different to yer inner-City suburbs where you can almost put a dollar per square metre on the land value.

The thing that affects the value down our way most is the position and the views, and the quality of the house of course.

For example, the block next door is currently on the market now (the owners are trying to sell it themselves). It is approx 1100sq/m. The views are pretty good, but not 180 degrees like ours.

Both theirs and ours are on the low side of the court so all the view and privacy is at the back with no power lines or roads to look over, and the court is private and quiet. So, the position is excellent.

Our block is smaller at 823sq/m, but exceptional views as I said. The values today are approx the same. It doesn't make sense to lots of folks, but that's how it seems to work up on the hill.

Down on the flat nearer the beach, the story is different; anything close to beach and development size is worth a chunk more than the house next door on the smaller block, for eg.

 

[BayView]

Haha how funny I am trying to sell something agents tell me around 1.5m and told me to quote 1.3m plus.

Yes. what is it with this?

I get how it may work, but geez; $200k is a massive gap to close...that's where my concerns were for our joint.

Good luck with your sale DB.

 

[BayView]

Had to laugh;

The guy who offered $1.25m on our place was next door this morning with the owners - looking to possibly buy their vacant block.

They want $550k apparently, so let's assume he gets it for say; $500k.

Our joint cost $760k for the house build, and about $90k for the pool and spa. (4 years ago)

Add another $30k for plans and permits approx, plus whatever else for landscaping, blinds and so on - another $20k at least.

Total to get what we have would be approx $1.450m at least, I reckon.

I guess he could build a more basic and smaller house.

And; about 2 years before he moves in.