Rented through this Business for about 3 years. I don't anymore however they have excelled my vision of what a Property Management Group should be!! Caleb Thomas
On Tuesday night the infamous Sydney apartment where Simon Gittany murdered fiancee Lisa Harnum fell flat at auction.
The two-bedroom apartment had been pegged to sell for more than $2 million, but ended up being passed in.
In a market where almost nine out of 10 homes are selling at auction, the lacklustre performance of Liverpool Street apartment still took some by surprise.
Ewan Morton, managing director of real estate agency Morton who are selling the home, said that there were no bids at the auction but that there were registered bidders.
It was put back on the market for $2.4 million under private treaty.
Greville Pabst, CEO of property valuation and buyer’s agency WBP Property Group, said that in a hot market, homes with a stigma, like Gittany’s former rental, were better placed to sell than otherwise.
“When you have such a strong market as we are experiencing at the moment and there is strong demand, people are more forgiving,” Mr Pabst said.
“In a weaker market buyers are more particular.”
It also depends on the type of buyer. Developers may be less interested in the history of the property, while a home buyer is likely to be more concerned.
Whereas in regional or smaller local markets where the community is tight-knit, these homes may struggle to pull their prices back up.
However, in the larger cities that are now becoming global, times have changed.
“People forget pretty quickly and it has become more sophisticated now.”
Last year in China, a real estate broker created a database of the Beijing homes with nightmarish back stories.
Although no such database exists in Australia, real estate agents do have a duty to disclose murders, suicides and other material facts that may be offputting to buyers.
Mr Pabst warns that when a bad event is fresh in someone’s mind, the effect on the home’s value is likely to be that of relocating it to a main road. It could have an effect on price by up to 10 per cent.
Whereas some will not be swayed by a property’s background, it is certainly likely to make others question their interest in purchasing.
Here are how other houses with gruesome histories fared when they hit the market.
North Ryde, New South Wales
In 2001, when the material-fact legislation did not exist and disclosure was not required, Sef Gonzales brutally murdered his family in a Collins Street, North Ryde home.
In 2004 the home hit the market and unaware purchasers put down an $80,000 non-refundable deposit on the home. Later discovering the truth about the home due to media reports, the devout Buddhist family no longer wanted to go through with their purchase. After consulting with real estate consumer advocate Neil Jenman, they finally managed to get their deposit refunded.
For the first time in NSW history, the agents were fined $20,900 for not disclosing the murder.
They were going to pay $800,000 for the home. It sold one year later for $720,000. This time, the purchasers knew of the home’s history.
It’s not the only home with a background that saw the sale floundering.
North Epping, New South Wales
In 2009, five members of the Lin family were murdered in a Boundary Road, North Epping home. In 2012, the home sold. The four-bedroom, three-bathroom house achieved $766,000 – $134,000 less than the $900,000 price guide. Comparable properties spanned up to $950,000 at the time.
The material fact was disclosed to all qualified buyers, with death certificates included in the contract.
Rozelle, New South Wales
However, sometimes a home can shake a stigma. In 2009 the lounge room in a home on Goodsir Street, Rozelle, became the crime scene of the Frisoli brothers’ murder. They had been stabbed to death by a former business associate.
In 2014, the house sold at auction for $2,265,000. Some $200,000 above reserve, it was noted at the time that it would have been marketed at $2.2 million plus had it not been for the stigma of the murders.
It was substantially renovated and it seems the Byron Bay purchaser was unfazed.
At the time, BresicWhitney selling agent Adrian Oddi said that they priced it as though it were on a main road – giving it a $2 million plus price guide.
“Except that unlike a main road that will always be busy, over time and successive sales, the history of this place will diminish,” he said.
Rewind 38 years and in January 1977 the bodies of Suzanne Armstrong and Susan Bartlett were found in an Easey Street, Collingwood home after being stabbed to death.
The Victorian terrace sold at auction for $571,000 in 2011.
The sales result was strong, considering the agents had estimated $460,000 to $500,000 for the sale. However, similar homes regularly achieved $600,000 plus.
It had previously changed hands in 1983 after being vacant for six years.
Mr Pabst referred specifically to the Easey Street home and noted that with new generations, buyers do forget about what has happened as time heals the wounds of the past.
“If it’s fresh in the mind it may be a bit challenging from a marketing perspective,” he said.