A higher than expected clearance rate at last month’s auction ‘Event’ signals the resurgence in activity in the Gold Coast market, according to the chief executive of one real estate group.
‘The Event’, held by Ray White Surfers Paradise in late January over the Australia Day weekend, is now in its twentieth year. It saw more than $30 million worth of residential properties sold in front of a crowd of around 1,400 people.
Ray White Surfers Paradise Group chief executive Andrew Bell told Real Estate Business that the clearance rate was “so strong that it caught [him] by surprise.”
The team auctioned 103 properties and achieved a 70 per cent success rate under the hammer, which was a remarkable outcome, Mr Bell said. “It’s a higher success rate than Sydney and Melbourne were getting.”
The properties for auction were predominately in the sub-$1 million market, ranging from $170,000 for a small apartment to properties priced around $800,000 to $900,000.
Mr Bell said the change in buyers’ attitude between late-2012 and early this year especially stood out to him over the month of marketing.
“It was like day and night between pre-Christmas and post-Christmas. It was like a line in the sand around Christmas Day,” Mr Bell said.
“Before Christmas, the mood was very much one that had been affected by the GFC, so there was a lot of fear, a lot of apprehension, a lot of concern, a lot of doubt, and inaction by people.
“From Boxing Day on, it was completely the reverse. We had four times the inspection number we had from the previous year, and multiple bids on properties. In most cases, we had four or so bidders on the properties.”
Most properties were sold between five and seven per cent over the reserve price, he added.
While the resurgence of activity was across the board, ‘A-grade’ properties that were in an outstanding position or location attracted the bulk of the interest, while apartments in Surfers Paradise also saw strong interest. He attributes the resurgence in activity to interest rate cuts and improved consumer sentiment.
“[The] buyers believe that it’s at the bottom of the market, and now is the time to get back in,” he explained. “There’s a belief that not only Australia, but the broader world economy are gaining some momentum.”
According to Ray White, the team also sold $13.8 million worth of prestige properties in the auction series. Mr Bell said this year’s Event was the best auction he held since 2007, with the amount of sales totalling at $72 million for the month ending January.