Where's the Doom and Gloom???

[buzzlightyear]

2 bedroom flats with car parking are hot property. One sold in Dickens st, St Kilda for $553,000. It was an ordinary flat in a 1970's complex. Admittedly it was very well located - opposite the St Kilda Gardens and within walking distance to Acland Street, the beach, public transport etc.

Still, I thought it was pricey!.....

You are right, it is pricey It is a great location, I agree, its almost Elwood.

But here is the conundrum for buyers. Inner city Melbourne has a shortage of good quality stock when you take into account the interest around and low interest rates, prices are being supported and dare I say increasing in some cases.

Maybe we need the banks to increase SVR's marginally to spook everyone back into their shells

 

[Ms Jade]

...Where I am looking at (Rich, SY, Prahran, Sth Melb, Port Melb etc...) I am finding that some prices are strengthening and with good interest and solid crowds. I don't assume this applies to the myriad of submarkets in Melbourne metro. I don't know them. Admittedly, I suspect, that some vendors have realigned their price expectations and are meeting the market. How else can you explain a high 80's auction clearance rate?

I was hoping for the winter to kill off these green shoots of confidence.

Buzz, for the past couple of months I have been feeling that Richmond is a bit over-heated, but I haven't been watching that closely. What are your thoughts? With so many people willing to pay 600-700k in Richmond I would think Prahran starts to look more attractive.

As far as winter dampening spirits - no way. If I had a good property to sell I would list it now as there is just not enough stock. Will be very interesting to see if vendors are holding back for Spring. With all the positive RE news coming out it may be that more people feel optimistic enough to put their property on the market. I wouldn't be surprised to see a noticeable increase in supply come late August (more than the usual extra % for the change of season, i mean).

 

[buzzlightyear]

Buzz, for the past couple of months I have been feeling that Richmond is a bit over-heated, but I haven't been watching that closely. What are your thoughts? With so many people willing to pay 600-700k in Richmond I would think Prahran starts to look more attractive.

As far as winter dampening spirits - no way. If I had a good property to sell I would list it now as there is just not enough stock. Will be very interesting to see if vendors are holding back for Spring. With all the positive RE news coming out it may be that more people feel optimistic enough to put their property on the market. I wouldn't be surprised to see a noticeable increase in supply come late August (more than the usual extra % for the change of season, i mean).

Wouldn't characterise Richmond as overheated. I would say temperate to warm with pockets of heat. As for Prahran, I would be reticent to say what I have seen is a respresentative sample of the area, but I wouldn't say it is any different to Richmond. In fact, all of the inner cuburbs that I mention, I do not see a great deal of difference between them.

How's this Prahran property. Effectively land value, but you need to keep the facade (well until the second chminey I suspect )given the heritage overlay in the area. The land size is a fraction over 100sqm, albeit with ROW, but will sell for around $500k. Went to the OFI, and plenty of people, but that is because of the price point for the area. Although it will only be suitable for a fraction because of the condition of the property.

I am not making any linkage to the Melbourne 2007 property market, but that year started slowly and continued to build progressively. The winter, which is generally, a quieter time, continued to build then. Amazingly there are some parallels. It is however only early in winter, so July/August will be interesting to see how auction, sales results and prices go.

If its good enough for the sharemarket to rebound 30% from its lows, then a slight uptick in property prices IMO is not unreasonable. But my predictions over the last 18 months have taught me...well....let's say I need to give up predicting

 

[Ms Jade]

How's this Prahran property. Effectively land value, but you need to keep the facade (well until the second chminey I suspect )given the heritage overlay in the area. The land size is a fraction over 100sqm, albeit with ROW, but will sell for around $500k. Went to the OFI, and plenty of people, but that is because of the price point for the area. Although it will only be suitable for a fraction because of the condition of the property.

Love it. Obviously ripe for a 2 storey addition. I'll be shocked if it sells for 500k though. I think buyers would pay more than that in Richmond right now - which is the point I was trying to make (albeit badly). Prahran is a better area & I would rather buy there than Richmond - except Richmond SHOULD be cheaper. That 611k property you posted is looking awfully close to a Prahran price so I'd be trying to get in there instead....If only I was in the position to do a major reno on this Prahran one...

...If its good enough for the sharemarket to rebound 30% from its lows, then a slight uptick in property prices IMO is not unreasonable. But my predictions over the last 18 months have taught me...well....let's say I need to give up predicting

Yep, I'm with you there. More than the usual number of competing factors right now. If credit continues to tighten it will have a negative impact regardless of how optimistic the market feels.

 

[buzzlightyear]

Love it. Obviously ripe for a 2 storey addition. I'll be shocked if it sells for 500k though.

Sold at auction for $480k.

Another couple of 2bedders in Prahran, renovated mind you, sold in the 8's today. I am still being surprised at the strength of these prices.

 

[jingo]

I am not making any linkage to the Melbourne 2007 property market, but that year started slowly and continued to build progressively. The winter, which is generally, a quieter time, continued to build then. Amazingly there are some parallels.

An agent I know well in Carlton North has been making the same comparisons as you Buzz. He said 2007 started just like this year!! mmm. Time will tell I guess. It is not unusual for people to head into property after a sharemarket crash. It has happened in past cycles. With financial planners receiving bad press after the crash of Storm Financial, and the government tinkering with superannuation, people may think their hard earned is safer in bricks and mortar. Time will tell I guess Buzz....

Regards Jason.

 

[Ms Jade]

Sold at auction for $480k.

Another couple of 2bedders in Prahran, renovated mind you, sold in the 8's today. I am still being surprised at the strength of these prices.

Saw this in the auction results today, too. Buzz, did you buy it? Hope so, as whoever bought this will do very well...

 

[buzzlightyear]

Saw this in the auction results today, too. Buzz, did you buy it? Hope so, as whoever bought this will do very well...

No, not me.

You would still need to spend I would imagine at least $250k and probably closer to $300k to renovate and put in a 2nd story. That's $780k not including stamp duty & holding costs. If you had the money today, a fully renovated one today might be a better option (?).