Buyers beginning to win the arm wrestle in Sydney’s residential property market

Although auction clearance rates in the Sydney property market for October 2011 were broadly in line with previous months this year, there was an unmistakable sense around the auctions and in negotiations that buyers in the $1 million plus bracket were at last beginning to prevail over previously stubborn vendors now prepared to meet the market.

Given the spike in mortgagee and forced sales of both residential and commercial sales on which next month’s CurtiseCall will focus, it is tempting to infer that financial exhaustion contributed to that trend. Over quoting by listings starved selling agents also undoubtedly had a role to play.

It was a trend evident across the entire City including the inner west which has generally performed strongly in the past 18 months. A terrace in a prime position at 13 Watkin Street, Newtown was one of several examples in the otherwise strongly performing inner west. Marketed in 2010 until rendered flyblown by its $1.325 million price tag, that property eventually sold this month for $1.19 million.

The story was the same with 10 Church Street, Balmain with the purchaser agreeing to pay a price of $1.055 million following the withdrawal of this property from auction in March 2011 and an initial asking price of $1.155 million.

Further west, 11 Day Street, Drummoyne sold this month for a little over $1.1 million having been listed on 22 October 2011 with a $1.179 million price tag.

Several properties in the eastern suburbs fell victim to the same trend especially those less than prime grade properties such as 17 Bloomfield Street, Surry Hills which, having originally sought offers above $1.025 million, sold for $950,000. Similarly, the seller’s hopes of offers above $1 million for 526 Crown Street, Surry Hills failed to materialize when that property sold for $950,000. The refurbished 31 Denison Street, Bondi Junction sold for $990,000 after a $1.1 million campaign that began in September 2011.

Despite being in an up and coming pocket, 5 Trevilyan Avenue, Rosebery traded for $100,000 less than the $1.5 million price guide it was advertised with in November 2010.

It is impossible to leave the eastern suburbs without also commenting on the near absence of sales activity in this bracket in Woollahra. Once considered bomb proof, that suburb has been a near buyer free zone for much of this year with only four recorded sales in this bracket in October 2011 compared to Paddington’s 14 sales.

It was vastly different scene on the lower north shore with Mosman recording 29 sales in this bracket. To do so, several sellers on that side of the Bridge were forced to meet the market and lower initial price expectations. This included the mortgagee of 26 Holt Avenue, Mosman which had to settle for $2.457 million despite the property having been first listed in November 2009 at $2.625 million. The mortgagee of 42a Rangers Road, Mosman accepted $1.75 million which was $75,000 less than its 19 October 2011 asking price. At least that was a better result than the one achieved by the hapless vendor of 16 Vista Street, Mosman who sold for $1.22 million. Not only was that the same price for which it was purchased in 2008, it was $80,000 less than the asking price first advertised way back in March 2011.

Buyers undoubtedly gained the upper hand further up the line with some of the greatest price adjustments being recorded on the lower and upper north shores of the Sydney property market. Line honours belonged to 31 Stanhope Road, Killara which was advertised on 5 October 2011 with a price guide over $2 million and sold for $1.66 million. The second place getter appears to have been 17 Ferncourt Avenue, Roseville which debuted in September 2011 with a $1.675 million asking price only to sell this month for $1.43 million. Similarly, having failed to sell at auction and languished for several weeks afterwards with an asking price of $1.59 million, 5 Clarke Place, Killara eventually sold for $1.5 million. Further north and 9 Hawley Close, St Ives sold for $1.125 million which was $225,000 less than its advertised price over 13 months ago.

Properties to watch in this respect over the next few weeks include 18 Cox Avenue, Bondi which has been on the market for months at $2.8 million; 7 Rowland Avenue, Bondi where the owners have unsuccessfully been seeking more than $2.4 million since March 2011 and 26 Barambah Road, Roseville which, with $200,000 shaved off its original hopes, is now on the market for over $1 million.