Footage from a record-breaking $8.6 million auction in Strathfield in Sydney’s inner-west has sparked heated reaction online, amid suggestions that Australia’s property market is being flooded with foreign cash.
But the agent who sold the property has now revealed that the buyer was a “local”.
The “uber-luxury” five-bedroom, six-bathroom home at 31 Augusta St went under the hammer in late February, fetching the eye-watering price after frenzied bidding from five registered parties.
A 40-second clip from the auction, originally posted to Instagram by Norman So from Belle Property Strathfield, has since gone viral with more than 1.6 million views and shares across TikTok and X.
“It just snowballed out of control, my phone still goes off every five minutes from someone commenting or posting a like,” Mr So said on Monday.
“I posted it because I’m a local agent in the area, I was obviously proud of the work my team did to curate the property, going through the marketing and generating interest.”
According to Mr So, the widespread social media commentary suggesting the buyers were from overseas was incorrect.
“There were nearly 20,000 comments, some are positive, some are negative as per all social media platforms,” he said.
“But I know for a fact that the purchaser is a local. The purchaser is in the medical profession. They don’t have time to buy the land, knock down and rebuild.”
Mr So said the typical buyer of high-end property like 31 Augusta St would be on a household income of around $1 million and would have already accumulated a large property portfolio.
“My typical doctor I handle would be earning $500,000 to $600,000 per annum, and their partner [is also a doctor earning a similar amount],” he said.
“They have income of $1 million a year, they’ve gone through the property journey and by the time I meet them in Strathfield they would have upgraded a couple of times and created equity and capital in previous homes.”
By around 55 to 65 years old these buyers “have already gone through ups and downs of their property journey and just want the ultimate”.
“Some want the ultimate in the eastern suburbs,” Mr So said. “You see the same comments when you see a $22 million or $25 million sale in the eastern suburbs.”
In terms of a singular figure $8.6 million “might sound like a lot” but it was the result of “wealth accumulation”, Mr So added.
“What’s happened is people have seen the video, Googled the address and can’t picture this house getting $8.6 million,” he said.
The $8.6 million price tag is below the overall suburb record of $12.1 million for 26 South St last year.
Previously among the most expensive sales were $10.9 million for Strath Glen on Strathfield Ave, purchased in 2021 by the Metledge family.
Also in 2021, the massive Dunrobin estate on Llandilo Ave fetched $9.5 million.
But Mr So said those properties had at least double the land size of 31 Augusta St, which set a new record for a 700 square metre block in the suburb.
“It was the first registered sale in Strathfield that achieved that rate per square metre — $8.61 million divided by 701 square metres, that’s a high rate per square metre,” he said.
“Basically this is eastern suburbs pricing for Strathfield. It was important for my vendor because this is the first uber-luxury home curated for Strathfield and sold out to market.”
The property last sold for $2.92 million in 2020.
The old double-brick home, which had been held by the same family for more than 70 years, was knocked down and rebuilt for around $1.5 million.
Built by luxury home builders Empirical Developments, the new double-brick and concrete dwelling features heavy use of marble, three-metre high ceilings and a tropical garden and poolside terrace.
“The finest brand-new estate to accompany the market in Strathfield, this landmark residence fuses flawless architecture, tropical landscaping, and refined interior design,” the agency listing read.
“Its sheer-scale interiors reveal purified luxury, state-of-the-art innovation and meticulous attention to detail whilst seamlessly integrating in/outdoor space. Set to impress the most [discerning] of buyers, this exclusive home has been built to prioritise optimal liveability with a bright north-to-rear aspect and finishes in Italian marble detail, off-form concrete, natural European oak, travertine and limestone.”
Mr So’s clip from the auction was reshared again on X over the weekend by a user who wrote, “$8,610,000 in Strathfield. Look at all those bidders with hard-earned cash because let’s face it who’s going to borrow 80 per cent of this selling price.”
The average principal-and-interest home loan rate for owner-occupiers was 6.21 per cent as of February, according to the Reserve Bank, meaning a borrower with a 20 per cent deposit would be paying an estimated $42,000 per month.
The average loan size in NSW was $785,000 as of December 2023, Australian Bureau of Statistics figures show, and one X user who said they worked at a big four bank said they “don’t really see residential mortgages in the books greater than $4 million”.
Freelancer chief executive Matt Barrie commented, “Australia has become a dysfunctional society.”
Satirical X account Reserve Bank of Property said, “Congratulations to the new buyers of this $8,610,000 home just a 30-minute stone’s throw inland from the Sydney CBD. The government eagerly awaits the $533,000 stamp duty check in the mail.”
Anti-Chinese Communist Party activist Drew Pavlou said, “Right now many wealthy Chinese families are fleeing China to Australia to escape the misery of Xi Jinping’s rule. China has strict capital controls under Xi. How do people get millions out of China to invest in Australian real estate? I don’t know how, I’m genuinely wondering.”
Under Australian law, foreign investors are only allowed to buy new properties and not established homes.
From July to September last year, the Foreign Investment Review Board approved 1374 residential real estate applications with a total value of $1.5 billion.
The lion’s share, $700 million, came from China.
Mr So said he had a number of homes coming up that “will definitely beat this record” — but he was not sure if he could recreate the viral success of the video.
“I did not expect this to generate 1.6 million views,” he said.
“I think whether you’re a buyer or not people found it interesting. For Sydney’s inner west to get these types of numbers is quite rare. I’ve certainly enjoyed the ride.”