A curious thing happened in the Dickson neighbourhood when a house went up for auction late last month.
This was an ordinary enough house. It had been owned for decades by the one owner and had been successfully rented out in recent times to string of good student tenants. The house is an unrenovated original AV Jennings design. It remains a model house of the late 1960s.
The owners had taken the real estate agent’s advice and spent quite a bit of money repainting it inside, adding new guttering and a new gate etc. The garden was given a big clean-up and new furniture was installed.
The word on the street was that the owners were looking for about $750,000. Some thought this might be too high given the basics of the old-style house – the almost original kitchen and bathroom etc.
On the day of auction, Saturday November 19, there was the usual largish crowd of the neighbours – and a few interested research buyers who attend just to observe how prices go. It turned out that there were about five real buyers.
What happened next was the surprise and you heard the reactions as the price went up. $750,000 was soon left in the dust as we headed for $850,000. There were loads of animated conversations.
But alas, just as it was a breath away from being completed, off we went again. The final price for this very basic and original styled house was $905,000.
The neighbourhood went home in the various directions to re-evaluate their own situations given that most had similar houses but with many extensions and most had modernized – along with much better gardens in many cases.
But I wonder just what this was all about. For one thing that side of the street happens to be zoned for apartments even though till now there has been only the one.
Most house owners think of these things from a perspective of a house is a home. There are now a growing number of interstate people appearing at these sales who are thinking pure investment. They are in their 30s or 40s and are monied up ready to make that large investment. But to what end?
The speculation is that this quiet little house could be bulldozed for apartments or even a set of three townhouses – or maybe a McMansion (there are now several close by).
No matter what the reason for the buyer coming forth with such a huge amount for this smallish and very unfashionable house, the neighbourhood is in shock.
I had stated that $750,000 plus was probably likely given the number of families now moving into the area for schools, amenities etc. But I could not have predicted this outcome.
On another point. There is much in the media about the older generations having the houses and keeping the next generations out of the market. Not quite.
The evidence based on recent sales around Dickson shows that many people in their 30s or 40s do not stand a chance of even bidding as the price goes high straight away. But within that same age range, there are plenty of people who are doing very well and are ready and able to push the price up to get their house or investments.
There is a house close by that has been put out to auction twice in recent years and on both occasions someone in that same age bracket paid the high price and acquired the house before it went to auction.
I am sure the scene will be alive and well for a while yet given that houses that come onto the market in Dickson continue to go very quickly – and the ACT Government has been pushing apartments at the cost of new standalone houses.
There are many other house sales stories from this suburb.
Dickson residents will be watching the next auction with interest.
It would be good to hear from others who watch the property sales in their suburb.
Was this a one off? Is it now normal for the inner north? Or is it the trend across all more established suburbs?