Auction mornings with the first homebuyer

Life is full of defining moments and for most of us the day we buy our very first home is a special and memorable day.

Considering many of our dreams and aspirations are tied up in the bricks and mortar of our homes, it’s unsurprising auctions are often loaded with expectation and emotion.

The buying process is far from dull, and realestate.com.au in partnership with CUA follows all the highs and lows in this Auction Mornings series.

Meet the first homebuyer

Our second hopeful bidder is Lena, an under-30 first homebuyer keen to move out of a rented house in Fitzroy and buy her own home in St Kilda.

‘I want to get into the market, own my own place and ground myself in Melbourne,’ says Lena, who’s originally from Tasmania.

Lena, who’s currently working in the property industry and studying a Masters of Property, definitely did her homework.

‘I decided on St Kilda because it offers a great lifestyle and is close to the city,’ says Lena. ‘I spent the first couple of weekends of my house hunting going to as many properties as possible to get a feel for what was within my budget, and to establish exactly what type of property I wanted.’

‘Once I’d decided on finding a modern one-bedroom apartment in a good, central location, I looked at suburb profiles and previous sales prices to get a good idea of rental and value growth,’ she says.

Lena also took into account current market drivers and forecasts – ‘thanks to working and studying within the property industry I have some good relevant knowledge,’ she says.

In terms of being well prepared for purchasing a home, Lena had all bases covered.

‘My finances were all in place,’ says Lena. ‘I had pre-approval, I knew where I stood in terms of stamp duty, the property had been inspected twice and I’d spoken with the relevant property management company to get a neutral overview of building conditions.’

The dream home

Located on a leafy part of Acland Street, St Kilda, 2/1 Acland Street is a perfect example of a fantastic first home and investment property.

‘The property is in a great location, is of a decent size, has a good layout and lots of natural light,’ says Lena. ‘It’s also in very good condition and doesn’t need any work doing to it. Although I’ll probably paint a wall or two to personalise the interior, and maybe add a vertical garden to the courtyard.’

‘The property itself is awesome,’ agrees John Carter, senior sales consultant, hockingstuart St Kilda. ‘It’s an architect-designed renovation brimming with lots light thanks to lots of glass and high ceilings. It also has plenty of nice features and polished floorboards, not to mention two car parks, you’re lucky to get one parking space in St Kilda!’

‘Lena has made an excellent move,’ he adds. ‘This property is a terrific investment. I wouldn’t be surprised if in ten years we’re talking a million bucks for great one-bedroom apartments in St Kilda.’

The suburb

Popular with a diverse mix of people, locals and tourists alike, St Kilda offers a fantastic lifestyle and plenty of picturesque spots thanks to its popular beach, pier, salt baths, beautiful botanic gardens and Acland Street, which bustles with cafes, bars, restaurants and bakeries day and night. Vibrant, laid-back and cosmopolitan in feel, this highly sought after suburb also has excellent transport links

‘The market in this area is super strong – the fact that we’re Bayside helps,’ says John. ‘As does the fact that first homebuyers don’t have to pay stamp duty for properties up to $600,000. We sell a lot of apartments, and I’ve seen a pretty full on price rise since the stamp duty change has come into place,’ he adds.

‘St Kilda has so much to offer,’ says John. ‘It’s very attractive in terms of real estate because it’s absolutely bullet proof investing. In my 23 years at hockingstuart St Kilda I’ve never seen a downturn in prices. In fact we’ve had incredible capital growth every year, mainly due to the “everyone wants to live in St Kilda” factor.’

According to John the median price around St Kilda for one-bed apartments start around $380,000 to $600,000, while bargain basement ones that need work start around $500,000 and can go right through to $1.1m to $1.2m and beyond depending on the property.

The auction

Lena’s strategy on the day was to bid confidently and stay within budget, her bidding limit between $450,000-$455,000.

‘This was my first ever auction as an active bidder,’ says Lena. ‘I went to a few prior auctions to get a feel for them, but I was still pretty nervous as I really wanted the property but I knew there would be competition for it. I also didn’t have much time to prepare because I had to study!’

Lena certainly didn’t let nerves get the better of her, placing her initial bid of $440,000 with confidence.

She continued to hold her own against two other strong bidders, one another owner-occupier, the other an investor, until her main contender, the investor, bowed out – with a twist.

While walking away from the auction the investor whispered in Lena’s ear ‘I’m out’. Armed with this knowledge, Lena went on to place the winning bid of $461,500. ‘It was a kind thing to do,’ she says of the lady in sunglasses who slipped away as discreetly as she’d arrived.

The auctioneer for the day, John Carter from hockingstuart in St Kilda was impressed with Lena’s bidding style.

‘The strategy the bidders – including Lena – employed was quite aggressive, which is the way to do it,’ says John.

‘There’s no point holding back at an auction, that’s not how you’re going to win. All the buyers were very active buyers and made a really good job of bidding.’

‘I think today was a really good move for Lena,’ says John. ‘She’s got herself out of a rising market and has somewhere to live in a great location. The vendor was very happy, we’re happy, the buyer is happy, it couldn’t have been a better day.’

Now, with the auction over, Lena is looking forward to moving into her very first home and making it her own.

If you’re looking to upsize, downsize or buy for the very first time, make a good move and speak with CUA today.