A three-bedroom Yarraville fixer-upper smashed its reserve by $255,000 on Saturday in an ultra-fast-paced auction.
Five bidders fought hard for the keys to the 1972-built house, undeterred by its original condition or the ripped-out carpet rolled up in one bedroom.
A crowd of more than 80 people braved the chilly Melbourne morning to watch 2 Regent Street sell under the hammer for $905,000.
It was one of 474 auctions held in Melbourne on Saturday.
By evening, Domain Group had recorded a 70 per cent clearance rate from 349 reported results.
Amid the shortage of stock for sale, some homes across the city fetched strong premiums as several parties competed. But other buyers remained hesitant to meet vendor expectations, preferring to let properties pass in and negotiate after.
There was no hesitation at the Yarraville abode, listed with a price guide of $620,000 to $680,000.
One bidder was quick off the mark to place an opening offer of $650,000 – its reserve price – and the property was immediately announced on the market.
A string of rapid-fire $10,000 rises ensued, with the price racing six figures above the top of its quoted range.
The stride then shortened to $5000 before a couple with a small child won the day with a $905,000 offer.
“The market spoke,” said the underbidder, who declined to give his name. “I don’t think it’s expensive. I do this every week so I sort of expected this sort of outcome.”
The vendor had owned the home for 32 years, paying $75,000 for the 258-square-metre-block, records show.
The long-term ownership meant the seller was willing to be conservative about price hopes, said auctioneer and selling agent George Alexander, of Jas Stephens Real Estate Yarraville.
“I sold one a few streets down for $737,000 and that was a better house than this,” Mr Alexander said, adding that the council valuation was $670,000.
“It did surprise me. I knew it would sell well, I had interest, but I didn’t expect to have that much competition.
“But, on the flipside, what do you buy in Yarraville for [that price]? Yes, the lack of supply’s a big issue.”
Although the home was liveable and had until recently been rented out, the new owners are likely to live in it short-term then have plans drawn up to build their family home, he said.
Meanwhile in Preston, a two-bedroom brick facade home passed in with no bids from the crowd of about 40 people.
Three registered buyers could not be drawn to raise their hands for the modern residence with courtyard at 269 Raglan Street, listed with a price guide of $690,000 to $740,000.
Only a vendor bid of $720,000 was offered, said selling agent Mario Butera of Woodards Northcote.
On Saturday afternoon he was negotiating with two parties while the vendor considered their reserve, and hoped for a deal soon.
“It is a strategy, the way the buyers do it these days,” Mr Butera said, adding that some buyers want control over the process.
“They allow you to pass it in … We’ll likely have a boardroom auction tomorrow night.”
In Prahran, a two-bedroom Art Deco apartment fared better, selling to a first-home buyer for $620,000, the top of its quoted range and $5000 above its reserve.
The unit at 2/2 Irving Avenue attracted three bidders after being offered with price hopes of $570,000 to $620,000.
“It was a little bit of a slow start,” Biggin & Scott Stonnington selling agent Michael Tynan said.
“In the end we were going in $1000 bids.”
All parties were first-home buyers, he said, adding that confidence was picking up as buyers can borrow at low interest rates. Older-style apartments were selling well, he added.
“First-home buyers can see there are some great deals,” he said.
Further east, a local family was willing to bid against themselves to secure a four-bedroom house in Croydon.
Rain during proceedings made the auction of 36 Alwyn Street finish faster than most, McGrath Croydon’s Paul Fenech said.
A vendor bid of $900,000 kicked things off, with the one keen buyer responding with a $950,000 offer.
Mr Fenech continued to push the price up with a series of vendor bids until the home sold for its reserve price of $1,050,000.
A process like this is common in the area, he said.
“We don’t out this way get three or four or five bidders, it’s normally one or two,” he said.
“You have got to use the vendor bid to get them up.”
He said the market in his area is improving but is in need of more listings, and offered an upbeat outlook for spring.
In Nunawading, a brand new three-bedroom home drew six bidders to sell for $82,500 more than its reserve.
The property at 2/13 Browns Road fetched $892,500 after some bidders only joined late in the race, Ray White Ringwood’s Chris Watson said.
“There is not a lot of stock on the market,” he said.
“A lot of people that were sitting back waiting for the market to bottom out – that has been and gone so now they are jumping in.”
He compared buyers to drivers looking out the “front screen of a car”: in a rising market they will pay $20,000 extra today to avoid paying $50,000 extra next month, while in a falling market they offer $20,000 less for a home they expect to be worth $50,000 less next month, he said.