By Sarah Webb
An investor keen to capitalise on Sydney’s soaring rent prices has splashed a reserve-smashing $1,711,500 on a two-bedroom unit in Bellevue Hill at auction on Saturday – knocking the socks off the vendors who had owned it for two decades.
With a $500 final bid the investor managed to muscle out four other active bidders, paying just over $350,000 beyond the reserve to secure 11/150 Bellevue Road, Bellevue Hill – a refurbished unit he plans to rent out for about $1000 a week.
The hotly contested auction attracted 10 registered bidders, an even split of investors and owner-occupiers, with five putting up their paddles for the home a short stroll from Double Bay’s cafe precinct. It had a price guide of $1.35 million, revised up from $1.3 million.
Selling agent Sean Poche, of PPD Real Estate said the result blew his socks off – particularly given investors don’t typically win these types of auctions as they’re rarely willing to splash such a reserve-busting sum on a rental.
It was one of 744 auctions scheduled in Sydney on Saturday. By evening, Domain Group recorded a preliminary auction clearance rate of 71.2 per cent from 476 reported results, while 92 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.
A Bellevue Hill apartment went to auction on Saturday.Credit: Rhett Wyman
“We weren’t expecting anywhere near [that] price … but rental returns are quite strong here and we’re noticing that investors don’t want to keep their money in the bank at the moment,” he said, adding the reserve was about $1.35 million.
“We reached that turning point recently and it has come with rents going up.”
An investor beat an owner-occupier.Credit: Rhett Wyman
Bellevue Hill’s median weekly asking unit rent is now $895, having risen 19.3 per cent over the past year, Domain’s latest Rent Report for the March quarter found.
Poche said the apartment’s tidy interior and stunning outlook attracted a strong cluster of buyers, with bidding kicking off at $1.2 million. Bids rose in $50,000 and then $25,000 increments until the $1.5 million mark, when the investor continued to battle it out with an owner-occupier.
“They were trying to knock each other out with $1000 and then $500 bids, and sometimes the investor was showing weakness, and it ended up being quite drawn out.”
Poche said the vendors – who relocated to the South Coast – were gobsmacked by the result, having held the unit for two decades.
Elsewhere in Hurstville, a father forked out a reserve-beating $2.76 million to help his daughter get her foot on the property ladder – claiming the keys to a five-bedroom, three-bathroom brick home at 166 Carrington Avenue.
Ahead of the competitive auction, agent Haydon Sacilotto of Ray White Georges River feared they’d be forced to lower the $2.3 million reserve, given the complicated nature of the sale which was through a director of GDK Group.
The original vendors of the home were declared bankrupt and had become the home’s tenants instead.
“It was a really good result, but we had a spanner thrown in the mix the day before,” said Sacliotto.
“We had to change the auction location because the tenants refused us access, so we ended up having it our office.”
He said of the 11 bidders eight were active, including a buyer relocating from Dubbo and a bidder from Western Australia.
Bidding kicked off at $1.8 million with $50,000 bids thrown down until the $2.2 million mark when it dropped to $10,000 and $20,000 increments. The price guide had been early $2 millions.
Sacilotto said the determined dad then managed to secure the winning bid, buying the Hurstville home largely because it was close to his daughter’s work.
“The contract ended up having three people on it, including the mum, dad and daughter. We’re seeing a lot of buyers leaning on the ‘bank of mum and dad’ now and especially in this price bracket because the mortgage on a $2 million home is ridiculous,” he said.
“They had to bring cash in from overseas to secure it.”
Sacliotto said the market was extremely buoyant with the small agency clocking 40 sales this year alone. “There’s not much stock out there though so everyone is pre-approved to buy,” he said.
At Miranda, a four-bedroom home “that was nothing special” on a 575-square-metre block sold for the first time since it was built in the 1960s, fetching $1,836,000. A Chinese expat family beat out 16 registered bidders to secure the title and claim their first abode on Australian soil at 31 Goodacre Avenue.
With a reserve of $1.6 million, selling agent Luke Lombardi, of McGrath Sutherland Shire, said the result was an outstanding one with 80 per cent of interest coming from families.
″It blew me out of the water how many bidders this home attracted. We thought we’d get around seven to 10 bidders but this home was in that sweet price spot and while there was nothing special about it, it was perfect for entry level buyers,” he said.
“I was quite surprised with the level of competitiveness I really thought bidding would die off towards the end, but I was surprised with how aggressive it was. There’s still a big shortage of properties which is fuelling these results.”
The price guide was originally $1.4 million, then revised up to $1.45 million then up again to $1.55 million.
Bidding for the home started at $1.6 million and rose in $20,000 and then $10,000 increments, Lombardi said, with the emotional vendors rapt to see their beloved family home secure a top figure.
He said the vendors bought the original lot in 1962 for £8000.
At 14 Hills Avenue, Epping, another single-level brick home featuring four bedrooms, two bathrooms and a 765 square metre parcel sold for $2.765 million – just over the $2.7 million reserve.
The home, marketed through Ray White Carlingford’s Nathan Circosta, attracted 100 groups throughout the campaign with 10 registered bidders, of which six were active, duelling it out.
Auctioneer Michael Garofolo, of Cooley Auction, said the property fetched just over the $2.7 million reserve with a family muscling out the underbidder – a Singaporean who virtually attended the auction – with a $2000 bid.
“I think everyone was like a deer in the headlights when we started the auction because the backyard was packed and everyone was surprised by the level of interest,” Garofolo said.
“So we actually had to start it with a vendor bid of $2.3 million which we drew a line in the sand because it was a cheap bid. Then there was a lot of back and forth with $20,000 and $10,000 bids and it was a bit like tap dancing.
“But the market is good and alive and well and vendors are motivated.”