St Kilda art deco home smashes reserve by nearly $200,000, defies weakening market

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A St Kilda art deco home badly in need of renovations has defied the weakening Melbourne property market, selling for nearly $200,000 over reserve at a cracker auction on Saturday.

Aged, overgrown and in disrepair, the art deco home at 23 Odessa Street had been a difficult sell during its campaign.

Selling agent Jesse Raeburn told Domain he was worried going into the auction because the prospective buyers he’d shown through the house expected renovations to cost about $500,000, limiting what they’d be willing to pay.

“It was a tough sell,” he said.

At the opening of the auction, it appeared his fears would be realised, as he struggled to get the home up from its starting bid of $1.2 million to the reserve of $1.4 million, with a few buyers attempting to limit their bids.

But the tide turned as soon when Mr Raeburn declared it was on the market. A bidding frenzy ensued and the house eventually sold for $1.58 million to a man bidding on behalf of a couple who were at the races.

It’s understood the couple will renovate the property, with plans to engage an architect.

“It sold above reserve by $180,000, which was great,” Mr Raeburn said.

The home was a deceased estate, being sold on behalf of the state trustee after the three beneficiaries couldn’t come to an agreement on what to do with the property.

“One of [the beneficiaries] would have liked to purchase the property but just wasn’t able to arrange that, it is a sad situation,” Mr Raeburn said. “Essentially [I was] taking this man’s home away from him, which is horrible.”

He said the sale of Odessa Street signalled that the St Kilda market was turning around, after recording a fall of more than 20 per cent in median house price in Domain Group’s latest state of the market report.

“St Kilda came too far forward in a short amount of time and it’s just unrealistic,” he said. “Homes shouldn’t double in value in four years — it’s just not sustainable.”

It was one of Melbourne’s 771 listed auctions on Saturday, with a reported clearance rate of 53.6 per cent.

Elsewhere in St Kilda, a single-fronted Victorian with three bedrooms passed in with no bids, and selling agent Michael Townsend said buyer activity was still suppressed in the bayside suburb.

“It’s a tricky one. There are tentative buyers and finance is tough,” he said. “People don’t want to overpay.”

This meant buyers would wait for a property to pass in and then go into negotiations later that day or evening, hoping to use other sales to inform their purchase.

“We’re often getting a lot of enquiry of an evening once a property has passed in, because they can access the marketplace.”

He passed the home, 22 Duke Street, in on a vendor’s bid of $1.3 million.

In Toorak, a two-bedroom apartment on Tintern Avenue also shot past its reserve, selling for $880,000 to an investor.

Bidding started at $700,000 and the reserve was set at $770,000.

Selling agent and auctioneer Andrew Macmillan said the home was particularly popular with owner occupiers, and drew four active bidders.

“It was a small block of apartments in a garden setting in a great location,” he said. “I think they bought it as an investment because they liked the location and the size of the apartment.”

Mr Macmillan estimated that the home would net the investor about $550 a week in rent.