The implications of Tuesday’s cash rate hike are being felt across Sydney’s auction market, as prior sales increase and bidder numbers decline.
Though, according to agents and auctioneers, this drawback represents an opportunity for buyers to pounce upon a lack of competition.
Ray White head of auctions NSW David McMahon said it was an “interesting week” across the auction market, with an increase in auction volume over the same period last year.
Auction activity has taken a blow this week as more and more properties sell prior to auction. Picture: Sam Ruttyn
“However, approximately 40 per cent of these properties were either sold prior to auction or converted to private treaty, highlighting a notable shift in campaign strategies,” he said.
“Buyer hesitation continues to be evident, and bidder activity remains around 25 per cent down year-on-year, with an average of 2.7 registered bidders and 1.8 active bidders per auction this week.”
According to Mr McMahon, the most prominent trend emerging from recent auctions is the rise in properties selling prior.
“This suggests that, despite softer on-site competition, there remains a clear opportunity for vendors to achieve premium outcomes,” he said.
“At the same time, it presents a window for well-prepared, finance-approved buyers to secure property ahead of auction day.”
MORE: Proof Sydney is the renovation capital of Australia
Ray White NSW head of auctions David McMahon. Picture: John Fotiadis
Offering an insight into the budget-end of the housing market was the sale of 4 Fleece Cl, St Clair, in Sydney’s west.
The three-bedroom, two-bathroom home sold for $1.1m, above its $1m expectations, to an investor.
Listing agent Charlie Stoffers of Ray White United Group said buyers had noticeably become “a little bit more hesitant” this week following rate hikes and further rises to the cost of living.
MORE: ‘A record low’: Rental affordability crisis deepens
4 Fleece Cl, St Clair
However, Mr Stoffers said opportunity lied within the current landscape for “smart buyers” looking to score a deal.
“People that are smart are buying now, while other buyers are on the fence,” he said.
“The ones that are buying, they’re not having to buy through competition.”
Mr Stoffers said this was a stark contrast to previous years, where homes could sell at auction for “way over reserve price” with as high as 10-15 registered bidders in attendance.
“Now, people are getting homes for, if not market value, slightly below,” he said.
“It’s definitely a good market for buyers.”
Mr Stoffers said auctions remain “the best way to go” for sellers.
MORE: Neale Whitaker and David Novak-Piper nab a Berry bargain
Vendor Brendan Nicol and listing agent Charlie Stoffers celebrate the sale of 4 Fleece Cl, St Clair, for $1.1m. Picture: Supplied
The home’s vendor, Brendan Nicol, said interest rates and the economy had left “everyone doing it tough”.
“It’s leaving everybody a bit scared of buying and selling,” he said., noting this may have reduced his home’s potential buyer pool.
Mr Nicol, who is now looking to upsize in the area, said the this month’s interest rate hikes had left him needing to borrow more to buy his next home.
“It just makes it things a little bit harder, because now I have to borrow more to achieve what I want,” he said.
He bought the Fleece Cl home in 2018 for $645,000 as a first home buyer.
The property sold for just less than the median house price in St Clair, which currently sits at $1.175m.
MORE: How petrol price spike could hit home values
1 Buckingham Rd, Berkeley Vale
The week’s most viewed auction listing on realestate.com.au was 1 Buckingham Rd, Berkeley Vale, in The Central Coast.
The home sold under the hammer for $690,000, well below the suburb’s $972,500 median.
The existing three-bedroom home is in original condition and requires substantial renovation, according to the home’s listing.
Listing agent Paul Hills of The Agency Central Coast called the auction, which attracted a rare nine registered bidders, a “great success”.
Mr Hills said the market in The Central Coast up to the $1.2m mark was “extremely buoyant” at the moment, with a lot of buyers coming out of Sydney.
The fixer-upper home was purchased by local first home buyers, who were “delighted” to be able to secure their first property.
Mr Hills said that with a few renovations, the Buckingham Rd home could become their own Buckingham Palace.
MORE: Australian bank refuses to lift rates in shock move
138 Salisbury St, Camperdown
In the Inner West, a modern twist on the Victorian terrace in Camperdown claimed a $3.85m sale price in an auction that, contrary to current trends, was brought forward due to strong buyer demand.
There were three registered bidders for the refurbished home on Salisbury St, all of which were active.
Auctioneer Damien Cooley said buyers should “lean in” to the current drop in competition across Sydney’s market, stating that registered bidder numbers across his auctions had declined.
MORE: The Oaks’ massive sale is second richest in history
9/235 Darlinghurst Road, Darlinghurst
It was double trouble in Darlinghurst as two side-by-side units individually sold for a total of $2.77m, to two separate buyers.
Units 8 and 9 on 235 Darlinghurst Rd were sold as part of a deceased estate, with the original owners’ three nices to be the benefactors of the sale.
Unit 8 sold for $877,000, while the larger Unit 9 sold for $1.2m.
Ray White Touma Taylor’s Amber Riethmuller said the benefactors were “thrilled with the result”.
English (US) · 