Melbourne and Sydney Property Sizzling

[Guest The Pom Queen]

MELBOURNE and Sydney's sizzling property markets are unlikely to cool down any time soon with a combined $668.9 million worth of homes selling across the two capitals during another "super" Saturday of auctions.

 

Australian Property Monitors senior economist Andrew Wilson said the auction markets in both cities were picking up, but Melbourne was "playing catch-up" while Sydney was breaking records weekly.

 

"Melbourne is in second or third gear and Sydney is in absolute overdrive; Melbourne's been tracking around 73 or 74 per cent for clearance rates while Sydney has had 16 of the last 18 weeks above 80 per cent," said Dr Wilson.

 

On Saturday, Melbourne saw an auction clearance rate of 73.1 per cent while Sydney tallied an impressive 83.7 per cent. This was a marked improvement on the same week last year when both cities recorded rates in the high 50s.

 

GALLERY: Properties of the weekend

 

Sydney sold $2.23 billion worth of property via auction last month; almost double the $1.12bn for the same month last year, a number which is set to be broken this month, according to APM.

 

"We're going to see $3bn worth of property sold over November. That'll be the highest number of auctions, highest number of listings, highest value of property sold at auction, and that is big news for the industry and big news for the state government who will be raking in stamp duty collections," said Dr Wilson.

 

Adelaide's auction clearance rate was 57.7 per cent while Brisbane had a modest 55.2 per cent.

 

Kay & Burton sold the weekend's most expensive home across the country, a two-bedroom house in Melbourne's Toorak which fetched $3.02m. But that was a rarity at the weekend, according to Mal James of James Buyer Advocates, who said Melbourne's top-tier market had experienced a "blip" on Saturday, with properties priced above $3m failing to entice bidders.

 

The failed auctions included a 2000sq m block at Brighton Beach that was passed in at $4.8m on a vendor bid, and a mansion in Camberwell which drew a crowd of 150 but failed to attract a single bid and was passed in at $4.1m.

 

Gary Peer of Gary Peer Real Estate sold 12 of his agency's 15 listed properties at auction this weekend, including one in Heatherbrae Avenue in Melbourne's Caulfield, that was passed in at $1.2m but sold for a "considerable amount more" post auction.

 

Mr Peer said Melbourne's market was not "red hot" but there was heat in certain segments. "It is definitely hotter at the lower end; anything under $1m and particularly for apartments," he said.

 

"The interesting thing is going to be seeing if this pent-up demand that has driven the market is going to continue."

- See more at: http://www.theaustralian.com.au/executive-living/home-design/records-keep-tumbling-as-sales-frenzy-steps-up-a-gear/story-fn6njxlr-1226756923179#sthash.hVlV9mXV.dpuf

[mattress]

Who's buying this property...apart from the Chinese, Singaporean and those from Hong Kong?

[flag of convenience]

Who's buying this property...apart from the Chinese, Singaporean and those from Hong Kong?

 

A few panicked investors and those getting over their heads in debt. The way it is being presented is putting the fear of god up folk to get in or be left out for ever. A report I've read has suggested mental health issues have arisen in many due to such fears.

The Chinese will be hard to much with syndicates and family groups clubbing together and willing to pay over the odds for housing, with very long term prospects in mind as well as local (Chinese) political considerations. Considering the number with the money the entire housing stock could be purchased all things being equal.

We are in a very sorry state to which it will take time to hit home. Besides outrageous real estate prices, the trend towards casual employment, business pushing for much lower costs(salaries) record immigration all point to a rocky road ahead.

[arrumac]

give it 18-24 months, there surely has to be some kind of correction.

[newjez]

give it 18-24 months, there surely has to be some kind of correction.

 

When the US starts tapering, the AUD will drop, and so will the value of the Chinese investments. There is an argument that this will attract more money - as the houses will be cheaper - but it also may deter as those who have already bought will get burnt. Interesting times.

[Sustain]

The problem at the top end is quality of stock on the market. When you see a $3m home go for $4m its not the market but the specific buyers fed up with looking at property priced at $3m but needing to be knocked down and rebuilt because a $500k house on a $2m land site does not work.

 

 

What I have noticed is a large number of high income earners have only achieved this working in single companies for long periods of time. When compared to market value they get a huge reality check. Imagine someone on $700k suddenly finding out they are only worth $150k when placed on the market through redundancy. OK they might have a $4m+ payout but in your 40's with a certain lifestyle accustomed it will be hard for them to adjust.

 

Being ahead of the information curve I still see blood in the streets coming.

[Steve99]

Who's buying this property...apart from the Chinese, Singaporean and those from Hong Kong?

 

an interesting aside to this is:

http://www.theatlantic.com/china/archive/2013/11/chinas-latest-corruption-target-overseas-real-estate/281199/

 

''China's Latest Corruption Target: Overseas Real Estate

 

Chinese officials and businessmen have spent billions on properties in elite pockets of London, New York, and Los Angeles. Beijing is now tracking them down. ''

 

''China’s corrupt officials and crooked businessmen have smuggled billions of dollars overseas, much of which has ended up in real estate in the United States, Canada, Australia and the United Kingdom—particularly in high-end neighborhoods in London, New York, Los Angeles, Sydney and Toronto. Now the Chinese government is embarking on a worldwide hunt to seize the properties with help from foreign governments, according to asset recovery and anti-corruption specialists.''

 

''Chinese officials “are interested in understanding where the assets are” in the U.S., and “the U.S. has said it will work with them,” said Nathaniel B. Edmonds, a former Department of Justice official and a partner with the Washington, D.C . law firm Paul Hastings. In July, Canada and China agreed to seize, share and return the proceeds of crime.''

 

 

my take is:

Will Aussie ''Authorities'' help Chinese police with their enquiries?? Not while the elites are rolling in it and filling their pockets with ill gotten house price rises across their property portfolio, this includes many politicians, bankers and of course high income earners with negative gearing in mind.

 

If you read the full article, you will see Aus in no2 on the list.. I see this as being Australia's equivalent of the UK's City of London international money scamming operations and just like that, if Aus property scam fails, tax payers will bail out the banks and big players.

Affordable housing is not for real people anymore, nor is it considered an issue to either side of politics.

I also notice that this did not make the press in Australia, it should have been front page and TV news headlines. Not in the best interests of the nation I assume, regardless of the moral implications.

[flag of convenience]

It is increasingly obvious that Aussies are being thrown to the dogs in a manner of speaking concerning real estate. It is not only that an affordability crisis has arisen, but also the fact that Australia has among the worst rental protection laws in the developed world.

Very hard to see how things will pan out, but yes banks are assured that the tax payer will bail them out come melt down.