Phil and Amity win The Block 2013: Lessons for the property market

With its telling third bedroom, Phil and Amity have won The Block 2013 All Stars series with their Bondi cottage selling for $1.67 million. It was $295,000 over its conservative reserve price, highlighting Sydney’s Autumn auction strength that has seen clearance rates at 70% or above for the past four weeks.

While Sydney clearance rates have been strong, and 100% at the Tasman Street for The Block, prices at The Block 2013 actually ranged from ordinary to exuberant.

The conservative reserve prices were well below cost, following a pragmatic decision implemented after its disastrous 2011 Richmond three out of four fail to sell auction experience, to align with the viewing public’s expectations of a drama packed end of series finale.

The two top Block 2013 auction prices reflected an exuberant tone, which while roughly matching the renovation costs, have placed the cottages at well above the suburb’s cottage median which could possibly present issues for capital growth down the track.

With agents understanding that getting prices that match outlay has been a problem for many reno-happy vendors across Sydney since the global financial crisis, their initial auction price estimates started at a cautious $1.4 million plus, with $1.5 million plus being suggested as marketing got underway.

There was a neighbouring, mostly unrenovated, cottage that fetched $1.32 million in late 2011, and another totally unrenovated for $1.29 million, giving the buying public some insight into the value of the similiar cottages requiring the costly ambitious renovations which the contestants undertook.

Originally Property Observer estimated the overall purchase price had been about $4.4 million, i.e. about $1.1 million each, but later revised the likely price higher to $5.2 million, i.e. $1.32 million each.

And then followed the costly rebuild renovation which came with a conservative Waverley Council approved $800,000 development application, plus the contestant couples expenditure on their renovations and styling.

Prices on the night ranged between $1.37 million and $1.67 million, a 20% price difference which suggests rip out that quirky bathroom sculpture and those buyers have done the best buying by far.

Bizarrely, Mark and Duncan’s BresicWhitney selling agent Seaton Jones had the greatest personal as well as professional stake in the high profile results as he had spent $1.29 million in late 2011 for his own unrenovated cottage just three doors away from the cheapest sale of the night. Its currently undergoing its own renovation having been utilised by The Block as the Mitre 10 storage space.

Without car parking and views, many observers believed the result would come down to the two contestant couples on The Block All Stars who built designated third bedrooms while the remaining two contestant couples stuck with the two-bedroom plan and offered a study.

The contestants Phil and Amity along with Mark and Duncan had the three bedroom options which were deemed a wise renovation decision.

Phil and Amity who appeared in the initial 2003 series at Bondi Beach taking home a $60,000 profit despite coming last, have suggested their third bedroom could boost the selling price by $100,000. They said the mezzanine was worth an extra $50,000. They had 12 Tasman Street listed through 1st City – Hasemer + Caldwell.Eyles, even sounding out the agents at the earliest point for the best renovation advice for likely buyers.

The Finders Keepers buyers agency suggested the reserve prices were in line with Bondi medians for three bedroom houses but well above those for two bedders.

Finders Keepers suggested the $1.65 million for a two bedroom semi away from the beach would be a record for Bondi.

They tweeted “Great result for #theblock and those contestants but let’s hope the buyers aren’t trying to resell anytime soon.” RP Data shows Bondi’s median house price is currently $1,387,000.

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