Better-than-expected results at the Block auctions at the weekend show Australians continue to see value in prime real estate "even in less certain times", according to a leading real estate agent.
Contestants Brad and Lara took out the 2012 edition of Nine's hit reality show with their top-selling terrace attracting an offer of $1.62 million, some $506,000 over the reserve price.
John McGrath, a real estate market veteran and The Block room judge, said the results shows quality homes in top locations remain a drawcard for buyers despite a general real estate market slump.
VIDEO: The Block 2012 couples say goodbye
GALLERY: The Block 2012 grand finale
"It appears that there was strong interest from both investors and owner-occupiers, which is what we have been seeing across the board," McGrath said.
"With interest rates lowering and many alternate asset classes far more volatile than bricks and mortar, investors have been re-emerging in larger numbers on the residential property scene over the last few months."
Also performing above expectations were the show’s other contestants:
• Dan and Dani's terrace (reserve $992,000) sold for $1,440,000
• Mike and Andrew's terrace (reserve $966,000) sold for $1,400,001.01
• Sophie and Dale's terrace (reserve $975,000) sold for $1,330,000
McGrath has been associated with the The Block series since its 2003 inception and rated this year's program "a great success".
"I think the sale prices reflected both the great location of the properties as well as the quality renovation work carried out by the couples," McGrath said.
"While the show is a great marketing tool for the sale process, we are still talking about real buyers paying hard earned money for the privilege of ownership, so I believe they reflect a genuinely successful renovation and sale process."
Buyers writing out cheques for such large sums of money is "probably the best acid test of any reality television scenario", he said.
"The bidding was extremely strong at higher than anticipated levels," he said.
He notes the reserves were set by an independent valuer and "as we now all know, were well and truly surpassed."
"While I don't think this is an indicator that the Melbourne or Australian market is back to its boom levels, I think it is a very real and very clear signal that Australians see quality real estate in prime locations as great assets to own even in less certain times."
The Australian Property Monitors senior economist, Dr Andrew Wilson, suggest the results showed that Melbourne's inner-city housing market was ''alive and well''.
Dr Wilson tweeted before the auction there were noted the May quarter median house price in South Melbourne was $1,097,500 – up 15 percent since February and seven percent since November 2011.
For more investment news and property tax tips visit Property Observer