A wealthy Aussie family has made a critical mistake by rejecting an offer on their luxury home, only to accept a much lower one this year from the same buyer.
A wealthy Aussie family have accepted an offer of $7.8 million for their luxury home, $2.45 million less than the same buyer offered them one year ago.
In another shocking example of Australia’s flailing luxury property market, the owners of the four bedroom home in Flinders, on the Mornington Peninsula, in Victoria, rejected an offer of $10.25 million last year.
But after spending 305 days on the market they finally accepted an officer of $7.8 million from the same buyer this year.
The property in Flinders, Victoria.
Real estate agent Rob Curtain, from Sotheby’s, who helped facilitate the home’s sale, said he hoped that the market had hit rock bottom amid higher interest rates and was expecting an uplift.
“A month ago, I thought we’d bottomed. It hasn’t really got worse, but the inquiries are just not there,” Mr Curtain told the Australian Financial Review.
“I do think the rot will stop with a good result in November – assuming we’re not paying $7 for diesel or there’s some sort of banking crisis.
“Stock levels are very low for this time of year for us... I am telling a lot of my clients who are considering whether to sell this year or next year that they should wait to put it on the market until after the election.”
It comes after one of Sydney’s ritziest harbour-view mansions sold for $12.8 million — almost $7 million less than it fetched four years ago.
Rothesay, an 1868 Gothic revival estate in Balmain East, last changed hands for $19.76 million in 2022.
Rothesay, an 1868 Gothic revival estate in Balmain East, last changed hands for $19.76 million in 2022. Source: realestate.com.au
Its latest sale represents a fall of almost 35 per cent as Sydney’s property downturn spreads through the top end of the market.
The six-bedroom home, which overlooks Darling Harbour and Barangaroo, was sold to an unidentified inner west local following several unsuccessful campaigns and an initial $18 million guide.
Businessman Devesh Mishra and his wife, Anshika, bought Rothesay from mortgage brokers Haitham Rifai and Malcolm Day in 2022. Mishra was a director of automotive parts business Cornell and MTQ Group, which later collapsed owing a reported $94 million.
Mishra subsequently declared bankruptcy and receivers were appointed to sell the mansion. It was initially offered last year with an $18 million guide before eventually changing hands through a mortgagee-in-possession sale.
Selling agent Matthew Hayson said the loss reflected both the downturn and the extraordinary price paid near the top of the market.
“It was brand new when it was purchased in 2022, and it was always considered a huge price at the time,” Hayson said via the Financial Review.
“It was the highest priced sale on the peninsula ever recorded, and it wasn’t a waterfront.”
Grim predictions for Australia’s property market began in May, when Morgan Stanley tipped a national house price correction of up to 10 per cent.
Since then, pundits have become increasingly pessimistic as the Reserve Bank of Australia (RBA) has continued hiking interest rates and the Iran war has raged on.
Two experts — Cotality Research Director Tim Lawless and AMP Chief Economist Shane Oliver — have both said they expected a national peak-to-trough correction of up to 15 per cent, exceeding HSBC’s forecast of a 13 per cent decline.
If realised, a 15 per cent drop would be the worst fall in nominal house prices that Australia has seen in the post-war period.
“If you just take the current quarterly growth trends and annualise it, we’re sitting on a trend rate of decline that’s at 15 per cent nationally and at 17.1 per cent across the capital cities,” Mr Lawless told news.com.au.
“We’re already seeing values falling at that pace. The question obviously is whether or not that will be sustained.
“I think there’s a pretty good argument that we could see this housing downturn re-accelerate, given higher interest rates alongside inflationary pressures, and what looks to be no real resolution in the Middle East.”
His comments came as national home values had fallen 5.2 per cent from their March peak, according to the latest Cotality data.
The decline for the combined capitals was 6.4 per cent, while Sydney was the city leading the fall (8.6 per cent) followed by Melbourne (7.5 per cent).
