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Buyers competing for properties in "bullish" Victorian market

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Emily is a Sydney-based real estate writer.

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Momentum builds across the Victorian housing market as Melbourne property values continue on an upward swing, posting one of the strongest month-on-month increases in the latest CoreLogic Home Value Index. 

Over the past few months, agents have reported properties consistently selling above reserve with buyers continuing to flood the market, driving auction activity to a fever pitch. 

We spoke to some of Victoria’s top agents about recent sales that smashed price records and exceeded seller expectations. 

“We had 199 buyers through the property and 17 bidders. 

Record-breaking price achieved for Keilor Downs home 

Ray Mirza and Anthony Orellana, Directors of Main Road Real Estate in Essendon recently sold a three bedroom property at 21 Hispano Drive for a record-breaking price. 

Mr Mirza and Orellana said they expected the property to sell between $650,000-$715,000 but the final sale price was some $150,000 above.

21 hispano drive
21 Hispano Drive sold for a record-breaking price. Source: supplied. 

Mr Mirza and Orellana said the property had an incredible amount of interest throughout the campaign. 

“We had 199 buyers through the property and 17 bidders. 

“There was a mixture of buyer interest, from first home buyers to young families and young professionals, and even a couple of developers that were looking at it because of the size of the block,” they said. 

21 hispano drive
The property at 21 Hispano Drive attracted 199 buyers through open homes. Source: supplied.

Mr Mirza and Orellana believe achieving such a great result was due to a combination of property presentation and a personalised buyer experience from the agency.

“With this property we got it staged and styled and gave it that homely feel,” they said. 

When a property is staged well, buyers can imagine themselves living there, and in a market where there’s huge buyer demand and low levels of stock, buyers who form an emotional attachment to a property will pay 5-10 per cent above market value to beat the competition.

Mr Mirza and Orellana explain that it’s also about looking after buyers. The team always ensures bottles of water are on offer at open homes and that there’s enough agents on site to assist buyers and get to know their needs and situation.

“There’s always three agents at every open, so you’re not just getting one agent at an open home. 

“I think a lot of buyers appreciate that personalised experience, because it’s easy to ask questions and make people feel more comfortable,” they said.

“Some buyers out in the second bid” — the auction market is strong in Sunshine 

Jason Allen, Director and Auctioneer at Barry Plant Sunshine says he and his team have seen phenomenal growth in the market since November. 

“It’s pretty bullish out there for vendors thinking of selling,” he said. 

“Houses are going from strength to strength and a lot of auctions are going above reserve. 

“People are turning up, getting excited but not even getting a chance to put their hand up at auction. 

“It’s pretty bullish out there for vendors thinking of selling,” he said. 

Unlike other agencies, Mr Allen says that stock is not an issue for them at the moment 

“Stock hasn’t really been a problem. Because of Covid, our entire team worked through January, when normally it’s their holiday, so we listed three times the amount we normally would have and now we’re seeing the fruits of that. 

“There is a fair bit of stock compared to what we would have had last year,” he said. 

Although the agency has a healthy amount of stock, the level of buyer competition is still incredibly strong. 

“For every property that we’re selling, there are two or three buyers competing,” he said. 

“We get a lot of people try and push to get in before the auction day,” he said.

7 Donald Street Sunshine
7 Donald Street was recently sold by agent Jason Allen. Source: Barry Plant Sunshine.

According to Mr Allen, the location of the home was a primary factor in its success. 

“It’s a neat rendered home in a very good location in Sunshine. 

“It’s located in a tightly held location called Matthews Hill. The supply is definitely very limited, so when properties come up there is certainly a lot of competition,” he said. 

On auction day, there were five registered bidders with bids escalating quickly. 

“We had three or four bidders at the top of the price guide. The first bid was $800,000 and the second bid was $930,000. There was a buyer that was adamant they wanted that property. 

“Some buyers were out in the second bid,” he said.

Mr Allen recently sold a three bedroom property at 7 Donald Street, Sunshine for $981,000 - smashing the quoted range of $800,000-$850,000. 

The renovated property which sits on an 800sqm block was eventually sold to a young family. 

Mr Mirza and Orellana said they expected the property to sell between $650,000-$715,000 but the final sale price was some $150,000 above.

Are prices expected to keep rising?

According to leading economists, yes. Forecasting from both Westpac and CommBank are pointing to a sustained boom over the next two years. 

The most obvious factor that could slow price growth down would be if APRA stepped in to tighten the conditions for lending. 

Recent data from Domain shows that listings are rising around the country, pointing to the relative confidence of sellers off the back of strong market conditions. 

Over the month to March 14, listings in Melbourne jumped by 9.1 per cent. 

The rise of listings at this time of the year is unusual, but given the unprecedented nature of the last 12 months, seasonality has been thrown out the window.