Sydney’s western suburbs attracted strong tenders on Saturday morning, presenting an affordable package and area for first-time buyers amid market uncertainty and rate hike concerns.
A two-bedroom villa at 3/177-179 Targo Road, Girraween attracted strong competition, selling well below the Sydney median house price for $860,000, $10,000 above its reserve of $850,000.
While the barriers to entry for first-time buyers continue to rise, boosted by forecasts of another interest rate hike on Tuesday, the sub-$1m property has seen interest from both first-time home buyers and investors.
With four bidders registered, an opening bid of $800,000 started the auction.
While the competition was hot between all parties, the $10,000 raise dominated the bidding, with the first buyer receiving the winning bid.
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Auctioneer Max Wylie is calling the auction at Girraween
Auctioneer Max Wylie said it was “a fantastic result”.
“It was a pleasure to see the intense tenders from all those who registered for tenders and it is clear that they were determined to get their hands on it,” he said.
“Our dealers will be more than happy with this result than they expected.”
According to Mr Wylie, however, there were opportunities for soft bidding in the current auction market.
“I see at the moment the buyers probably want to bid at low prices,” he said.
“But as we saw with that one, it had a little flow and when we called it to the market it got that second wind.”
Leading agent Amit Nayak of McGrath Parramatta said interest in entry-level property was influenced by the current climate.
“We hear a lot about uncertainty, whether it’s war or interest rates,” Mr Nayak said.
3/177-179 Targo Road, Girraween sold for $860,000
“I still believe that even though prices are increasing, places like Girraween or Greater Parramatta will still do very well because of the facilities and proximity we have in the area.
“It’s a very affordable price when you look at Sydney prices in general.”
Mr Nayak said that townhouses and guest houses, such as properties sold at auction, have also become popular with buyers who do not want a place to live, but cannot afford a house.
Mr Nayak said there were many young families and first-time buyers buying houses in the area around the same price range.
“Anything under $1.5m because of the first home buyer program – we were still seeing the market stay strong,” he said.
However, there are signs of trouble, with Mr Nayak saying homes valued at $2m or more have seen prices rebound, and activity has slowed.
Central banks and economists are increasingly expecting a rate hike on Tuesday. Photo: NewsWire/Monique Harmer
“Buyers are still playing it safe or they want to wait and many sellers are holding back at the same time,” he said.
“But if the level of listing stock remains low, we could see activity from an increase in buyers which means we could see more competition or prices go up again.”
Now that Lavanya Gurunadhan’s kids are grown up, she said they have decided to upgrade and sell the home.
“We love this house and this community is great, we feel like family,” she said.
“We are very happy with the result.”
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40 Grand View Parade, Lake Heights
One of the most viewed listings on realestate.com.au of the week, 40 Grand View Parade, Lake Heights sold for $1.51m.
With 18 registered and six active buyers, the home was fetching about $900,000.
In the same family for almost 60 years, Laing+Simmons St George Leading Agent John Kastellorios said the buyer’s interests included three front properties.
“It was a big crowd – competitive bids from the start,” he said.
In the Inner West, 111 Stanmore Road sold for $2.93m, above its $2.7m guide.
Leading agent Ercan Ersan of Ray White Surry Hills said the buyer had contested the sellers’ bid of $2.9m.
111 Stanmore Road, Stanmore. etc. again
Mr. Ersan said that the investors, who will rent the property, were guaranteeing themselves in the future by guaranteeing their family home.
“They were worried that they would not be able to buy it in five years when they have children, so they bought it now,” he said.
Ray White NSW head of auctions David McMahon said 165 auctions were scheduled for Saturday, still below the pace for this time last year, but “there was no dramatic drop in the number of auctions.”
“The clear talking point in the market today is that all eyes are now on next week’s RBA announcement,” Mr McMahon said.
“It is becoming increasingly clear from our data that the prospect of potential rate hikes, combined with the ongoing discussion about capital gains tax changes, is starting to weigh on consumer confidence.
Ray White NSW head of auction David McMahon. Photo: John Fotiadis.
“Looking at tender activity over the week, we averaged 2.4 registered bidders per auction – a 42 per cent year-on-year decrease.”
Mr McMahon said the soft sentiment was felt consistently across markets, regardless of price.
At the same time, Mr McMahon said they continue to see a large proportion of properties sold before auction, as buyers and sellers look to get results before going under the hammer.
“The encouraging takeaway, however, is that despite the uncertainty influencing consumer behavior, the market continues to show resilience,” he said.
“We’re still seeing about 85 percent of properties sold — whether that’s pre-auction, under the hammer, or soon — which highlights that committed buyers remain active when the right opportunity presents itself.”
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