The selling agent talked up the land sales to out of town buyers during the crazy boom period. However the selling agent also claimed to be a valuer and used this status to influence buyer sentiment.
A couple of suckers payed for heavily overpriced land. check out the sales below.
The sale price and lot sizes are listed below
■Lot 1 size 426sqm sold for $880,000 on the 24 February 2006 ($2065/sqm). River views. ■Lot 2 size 430sqm sold for $900,000 on the 24 Nov 2006 ($2093/sqm). River views. ■Lot 3 size 430sqm sold for $600,000 on the 21 Feb 2007($1395/sqm). River views. ■Lot 4 size 487sqm sold for $435,500 on the 16 Oct 2009 ($894/sqm). River views. ■Lot 5 size 324sqm sold for $280,000 on the 22 Aug 2007 ($864/sqm) ■Lot 6 size 335sqm sold for $265,000 on the 28 Aug 2007 ($791/sqm) ■Lot 7 size 332sqm sold for $255,000 on the 5 Feb 2008 ($768/sqm) ■Lot 8 size 320sqm sold for $255,000 on the 15 Mar 2008 ($796/sqm) ■Lot 9 size 335sqm sold for $280,000 on the 18 May 2007 ($835/sqm) ■Lot 10 size 321sqm sold for $280,000 on the 18 May 2007 ($872/sqm) ■Lot 11 size 320sqm sold for $300,000 on the 23 Dec 2007 ($937/sqm) ■Lot 11 size 320sqm sold for $249,500 on the 24 Oct 2009 ($781/sqm) (a drop of $50,000) ■Lot 13 size 338sqm sold for $300,000 on the 12 Jun 2006 ($887/sqm)
The average land price is $768 to $937 / sqm. Lot 13 which sold in 2006 was valued at $887/sqm. Yet lot 2 land size 430sqm sold for $900,000 on the 24 Nov 2006 at $2093 / sqm.
Other Local Area Sales Cannot Explain The High Sale Price
Look at 8 Anzac Tce sale for $560,000 on a 1113 sqm lot ($503/sqm) on the 22 Jan 2004. Or 217 Anzac Tce sale for $185,000 on a 569sqm lot ($325/sqm) on the 17 Dec 2005 (11 months prior to the sale of lot 2 Anzac Tce for $2093 / sqm)
Other Local Area River View Sales Cannot Explain The High Sale Price
■17 Ashfiled Parade, Ashfield WA 6054 sold for $900,500 on a 1051 sqm lot ($856/sqm) on the 11 March 2006. However this lot has a 2 bedroom, 1 bathroom brick and tile house insitu. ■43 North Road, Bassendean WA sold for $1,550,000 on a 3,594 sqm lot ($431/sqm ) in Oct 2006. However this lot has a 2 bedroom, 1 bathroom brick and tile 1932 built house insitu. ■31 Thompson Street, Ascot WA sold for $1,250,000 on a 1,733 sqm lot ($721/sqm) in Sept 2006. However this lot has a 1970′s brick and tile house insitu. This property is located up river and closer to Perth in a wider area of the Swan River, so is in a superior location. Yet the land value is only $721/sqm.
There is no clear explanation why lot 1 sold for $880,000 and lot 2 sold for $900,000. Other river view property sales do not explain the high sale price. The other lots sold at 1 Anzac Tce, Bassendean do not explain the high sale price. Other land sales prior to 2006 do not explain the high sale price.
At the end of the day the outcomes were influenced by dodgy real estate agents and lenders accepting heavily over inflated valuations.
Who said the banking system is not responsible for the boom and bust?
There is no clear explanation why lot 1 sold for $880,000 and lot 2 sold for $900,000. Other river view property sales do not explain the high sale price. The other lots sold at 1 Anzac Tce, Bassendean do not explain the high sale price. Other land sales prior to 2006 do not explain the high sale price.
There is a lot more to land prices than $ per square meter. eg. I'm willing to bet lot 1 and lot 2 are not the river view lots which are right next to the train line.
The truth of the matter is there simply isn't enough information there to form opinions on why lot 1 and lot 2 purchasers paid so much more than the other lots - and certainly not enough to jump to such conclusions
A friend a few years back bought a 2 bedroom apartment and gleefully showed me how they paid significantly less than the comparison data of some other 2 bedroom apartments in the same block. It was only upon closer inspection we found out the ones which were purchased for significantly more were the top floor "penthouse" units and included a private rooftop garden. My friends excitement was dampened somewhat after that.
The truth of the matter is there simply isn't enough information there to form opinions on why lot 1 and lot 2 purchasers paid so much more than the other lots - and certainly not enough to jump to such conclusions
Lot 1,2,3 & 4 all side by side with the same river view. The distance between lot 1 and lot 4 borders are approx 42 meters.
Lot 1 size 426sqm sold for $880,000 on the 24 February 2006 ($2065/sqm). River views. Lot 2 size 430sqm sold for $900,000 on the 24 Nov 2006 ($2093/sqm). River views. Lot 3 size 430sqm sold for $600,000 on the 21 Feb 2007($1395/sqm). River views. Lot 4 size 487sqm sold for $435,500 on the 16 Oct 2009 ($894/sqm). River views.
Yes hard to accept that the banks may have accepted gross over valuations. Banks never accept over valuations do they? Could never happen?
Would you say the price differential is extraordinary?
Would you say the price differential is extraordinary?
I'll say the price difference is great but there is not enough information to say whether it is extraordinary.
Do you understand there could be significant things which doesn't show up on the map which could affect prices of land? Eg, where sewer and drainage pipes run. Or council approvals where some properties can build 2 storeys because it is not blocking other's water views and others cannot. Or mature tree locations which are under protection and unable to be removed so the house needs to be built off to one side. Or one has deep water access and have approval to built a pontoon/wharf/mooring. Or whether there is the option for the rail authority to acquire the land should the need to increase rail capacity arise in the future. Or a myriad of other things which does not show up on google maps.
But all things being equal, I know people are willing to pay more to NOT have their house right up against the railway line.
I'll say the price difference is great but there is not enough information to say whether it is extraordinary.
Do you understand there could be significant things which doesn't show up on the map which could affect prices of land? Eg, where sewer and drainage pipes run. Or council approvals where some properties can build 2 storeys because it is not blocking other's water views and others cannot. Or mature tree locations which are under protection and unable to be removed so the house needs to be built off to one side. Or one has deep water access and have approval to built a pontoon/wharf/mooring. Or whether there is the option for the rail authority to acquire the land should the need to increase rail capacity arise in the future. Or a myriad of other things which does not show up on google maps.
The vacant land and all lots are fully serviced and unemcumbered. Ths site is a flat lot and elevated approx 8-10 meters above river level. And no mooring rights. Building conditions and restrictions are equitable for lot 1, lot 2, lot 3 and lot 4 the four river facing lots. Lot 1,2,3 & 4 are sitting side by side all facing the river.
Lot 2 size 430sqm sold for $900,000 on the 24 Nov 2006 ($2093/sqm). River views. Lot 4 size 487sqm sold for $435,500 on the 16 Oct 2009 ($894/sqm). River views.
Lot 2 and lot 4 are 20 meters apart and the price differential is extraordinary. At a boom price of $2093/sqm, which was the highest price ever paid for a lot on the Swan River in the low end of the Perth market. The bust price of $894/sqm. A drop of $1200/sqm or 57%.
The price of $2093/sqm for that location Bassendean is extraordinary! A drop of $1200/sqm or 57% is extraordinary!
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