We speak to the team behind the most intriguing recent property sale.
The property: A two-bedroom apartment with parking at 1200/211 Pacific Highway, Skye by Crown Group, North Sydney, NSW. Sold by private treaty after auction for $1.45 million. Records show it last sold for $1.465 million in July 2017.
Who was the agent/agency? Melinda Wong, Duncan Grady, Altium Property.
The two-bedroom apartment at 1200/211 Pacific Highway, Skye by Crown Group in North Sydney, sold for $1.45 million. Tom Ferguson
How long was this on the market? [Grady] Four weeks.
Why did this one sell? [Wong] It’s in the most popular building in North Sydney and second, it comes with a study. Lots of people these days are working from home and a study is very popular. Third is the view. People working from home can see the view as they work. My clients bought it for investment. Lifestyle is key for a purchase for investment. [Grady] It’s a quality property and it was a very good building and a very good location. And priced correctly.
Was it overpriced? [Wong] I think the price is just right.
What did you think it would go for? [Wong] We had a $1.39 million auction guide. We had two people bidding, but it wasn’t up to the price. It was passed in at $1.42 million.
What was surprising about it?
[Grady] It [sold] within the 1-2 per cent range of its last transaction. I might have assumed when the market doubles, [all parts of the] market typically double. The demand has floated away from modern apartments in inner locations to lifestyle or areas where affordability allows bigger properties.
The apartment was “good real estate” but failed to enjoy the upside of other housing types due to the pandemic.
[Wong] In the past, all the investment was about apartments. If people are buying apartments these days they are a) experienced investors and b) they are looking for a bargain. There are a lot of bargains around.
[Grady] It hasn’t suffered on the downside, it just hadn’t benefited from the upside. It didn’t go up to $1.8 million and drop back to $1.45 million. It might have gone in October 2021 – at the very peak it might have had another 7, 8, 9 per cent of value, but that’s still nowhere near the peak of a Crows Nest semi.
I don’t think I’ve seen in my 30-plus years in the game a 10- or seven-year period when one part of the market has gone up zero and another has gone up 300 per cent – that’s a huge disparity. That’s not just up 20 per cent versus 30 per cent.
[Wong] More and more people want to buy a house because of the pandemic. That is definitely a shift for a lot of investors. Before, it was apartments. Now, I’ve never seen so many people coming and saying: “I want to buy a house”. I’ve never seen so many people wanting to invest in houses. They believe they grow the most.
Room with a view: The apartment had a study that suited working from home.
Even though they know that rent for houses in the lower north shore never matches the value. It could be a $2 million house, and they get $1000, $1500 per week – they know that but they focus on the future. For them, that’s more certain – the land.
[Grady] This property was a high-grade asset. It was suitable for an owner-occupier. It had a great view, a good quality fitout. There was nothing wrong with this apartment. It was good real estate.
But would a buyer who bought it have been better to have gone to Ryde and bought a small house, rather than a luxury inner location? For the same budget, would they have done better going further out and getting a house and then come back in close and maybe afford the freehold in close?
That particular choice could easily have affected someone’s asset net worth by over $1 million.
Bargain now? The capital gain forgone by this property compared with a house in nearby Crows Nest showed there were opportunities for renters, the agent says.
Do you reckon we’ll see another result like this: a) next week b) next year c) next cycle d) never?
[Grady] a) Next week. The result of this was that market value was achieved on the day. There’s no reason for that not to occur every week. There are three buildings within 100 metres of each other on the Pacific Highway, each with 200 apartments. There are 600 apartments on that strip.
[Wong] Most importantly these days – we’re telling renters as well – if you want to live in a nice area, like North Sydney there are bargains around. They can afford it.
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