Australia – High Profile Sydney RE Weakness – No Takers At $1M-Off 2009 Prices

“It was billed as ‘Super Saturday’ but turned out to be more like soggy Saturday for Sydney’s home auction market.
The last Saturday in November is traditionally the most popular day of the year to buy and sell. But this year the clearance rate of 54.6 per cent was well down on estimates.
Actor Toni Collette’s historic Bronte home failed to find a taker, despite being offered at a discount of almost $1 million from the $4.4 million she paid in 2009. Invitations for opening bids of $3.5 million did not raise an eyebrow, let alone a hand.”

Sydney Morning Herald, 27 Nov 2011 [hat-tip canuckdownunder at VCI]

Any doubt that this market will end up with >50%-off discounts? -ed.

12 responses to “Australia – High Profile Sydney RE Weakness – No Takers At $1M-Off 2009 Prices

  1. It’s comforting to know real estate excuses aren’t limited to Canada… According to the article “Rain dampens sales expectations”… If there was lower interest in buying properties, surely it was because of the rain… not because of over-valued prices…

  2. Andrew Wilson, senior economist at Australian Property Monitors, said global economic turmoil was affecting markets here. ”The potential credit crisis in Europe has an impact on house prices in Australia. The Economist magazine recently reported Australian homes are 25 per cent overvalued and this affects buyers.

    ”But my personal belief is different to that. I don’t think we’ll see any significant shake-out in house prices. Buyer confidence is fragile, it’s been fragile all year. We seem to be ending the year on a downward note.”
    So, I guess Andrew Wilson, is the Australian version of Tsur Sommerville… Chief pompom waver for the local real estate industry?

  3. BTW, it looks like Collette may have put a considerable amount more than the 2009 $4.4M purchase price into this home.
    In April 2011 she was described as “having spent the past six months managing a $2.5M renovation on her Bronte home” [Telegraph Apr 2011].
    If that is correct, she may be into this property for up to $6.9M… and no bids at half that.

    Perhaps a glimpse of the future fate of some of our own preposterously overpriced properties.

    • CanuckDownUnder

      Thanks for that, nobody brought that up in all the media coverage this weekend. They must be desperate for a sale since she and her husband have climbed onto that next rung on the RE ladder – they already purchased a $6 million property in Paddington (wouldn’t these people sign confidentiality agreements?).

      The media is desperately trying to spin this weekend’s results as positive even though the clearance rate was only 55%, 60%+ is said to be needed to keep prices steady. What really skews this statistic is the large number of unreported auctions, only 401 out of 652 have actually reported in Sydney.

  4. The Australian pumpers are unanimous that there will be a recovery in 2012. (And therefore this is a kind of bottom, so buy now!) The base this solely on rising immigration. They somehow fail to grasp that even if the demand is there, the credit won’t be. 30% of mortgage funding comes from overseas.

  5. Doubts are a statistician’s way of indicating long tails. I always have doubts 😉

  6. Ah huh, but Australia has foreign buyer restrictions and we don’t….

  7. Doesn’t Australia do more real estate sales through auctions? Does that mean that their bubble will deflate faster?

  8. There’s a “you’re terrible” joke in that whole Toni Collette thing somewhere. 🙂

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