Who lost in Covid-fired buy frenzy
SOME of the buyers who bought into the exuberant pandemicfired Gold Coast residential market are now saying ‘ouch!’, no question. Cases are emerging of people who have spent millions of dollars later travelling down a losing path.
Not only are they failing to come out ahead on paper, but they also are being walloped in the background by various fees.
A case in point is a waterfront Benowa Waters property called the Lakehouse, which has been described as a ‘flawless fusion of luxury, functionality and architectural magnificence.’
It obviously hit the right note with Lynette Teulan who, with developer and racing driver the late John Tuelan, previously had tasted riverfront luxury at Paradise Waters.
Lynette last year bought the house, then a year old, before auction for $6.335 million.
It was relisted in July and, in a deal that settled last month, has sold for $1.335 million less.
Then there was stamp duty of around $340,000, agents’ commission, in-and-out legal fees, and marketing costs.
Late last year Sorrento owner Samantha Harvey found a buyer for a posh Sorrento home that included a cinema in the gold-class bracket.
The result was not as pretty as a picture – the property cost her $7.075 million in June last year and has sold for $6.45 million.
Her stamp-duty bill was close to $380,000.
There are buyers who appear to have come out on top but are, in fact, behind the financial eight-ball.
A prime example is the owner of giant riverfront Southport house Alston, Mathew Fitch, who cofounded Adelaide-based Fusion Capital.
He and wife Magdalena paid $23.75 million a year into the Covid pandemic and last year started trying to exit the property with a $30 million-plus asking price.
The allure of the French-style giant was not enough to bring an
acceptable offer and it was put to auction in September.
The upshot was that a buyer made a successful top bid of $24.8 million, lifting an earlier bid after the owners agreed to a six-month settlement period.
The Fitch on-paper gain is a little over $1 million but that does not take into account a stamp-duty bill of more than $1.3 million, holding costs and other fees.
The agents’ commission on the sale, even if it was at a lower-thannormal 2 per cent, would be close to half a million dollars.
Brian McMaster, a Tasmanian who
in 2021 made a multimillion-dollar killing on a century-old home he’d owned in Burleigh’s Goodwin Tce, has not quite come out smelling of roses after spending a year tasting life on the riverfront.
The home, in Broadbeach’s Monaco St, cost Brian and wife Lauren $11.6 million and has sold for $12.5 million.
The stamp-duty bill when the couple bought the property would have been around $640,000 and then there were the various other fees involved in buying a home.
The Queensland Government must love the McMasters – they’ve gone on to buy on the Mermaid beachfront, paying $14.1 million.
Their ‘duty’ there will have been heading toward $800,000.
Meanwhile, a player in the lucrative job of selling multimilliondollar homes says there are other examples of pain brought on by buyer enthusiasm to climb aboard the bus in a euphoric market.
He says there are more on the horizon.
That said, there’s far more pain at the other end of the market as mortgagees move on the homes of people suffocating under high living and mortgage costs.