When The Block television show first hit Australian television screens in June 2003, it helped fuel a huge wave of home renovations and property investments that has continued to this day.
Through the years The blockhas spawned half a dozen direct adaptations around the world and even more that have put their own spin on this now well-honed formula for reality television.
In the more than 800 episodes of the program that have aired as part of the 18 seasons on the air, the vast majority of the time it has shown a strong australian real estate market and that, through the renovations, investors could make huge profits on their properties.
Over the past decade, excluding the most recent season, The block saw 61 properties come under the hammer and 61 properties sold at auction, with an average profit of more than $430,000.
During this time The block it helped reinforce all sorts of myths and narratives about the Australian property market, whether or not they had a long-term basis.
That is until last week’s finale called some of those narratives into question.
For the first time in more than a decade, not all of the properties up for grabs were sold under the hammer at auction, with only three of the five on offer selling. Of those who sold, all went to one man.
That man was serial Block property buyer Danny Wallis.
Like my news.com.au colleague Nick Bond noted in an article earlier in the week:
“One can only imagine what the result would have been if Wallis had been busy on auction day.”
However, even with Danny Wallis spending more than $14 million on the three properties that sold, contestants Ankur and Sharon, Dylan and Jenny walked away empty-handed after their properties were turned over.
While this could change in the coming days and weeks as properties are re-advertised, it’s hard to imagine a future sales campaign rivaling the one staged by Channel 9 to The blockend of .
Reflecting the broader trend
In reality, the success rate of the auctions is well below the 100 percent success rate recorded by The block during the 10 years prior to the current season. For the first time since 2011, The block it is arguably more representative of the trends present within the broader market of the city on which a given season of the show is based.
The nearest major auction market to Gisborne, Victoria, is Melbourne, where during the weekend of The block finale less than half of all auction campaigns (47.5 percent) were successful according to data from SQM Research.
Instead of acting as a glamorous microcosm of the real estate market, The blockThe ending of, instead, reflected the sometimes challenging reality of bringing a property up for auction.
For contestants Omar and Oz, they profited from the same kind of bidding war that sometimes occurs in driveways and front yards across the country during auction season, and they walked away with a $1.59 million profit.
despite having what The block host Scott Cam called a “virtually identical” house, contestants Tom and Sarah Jane walked away with a profit of just $20,000.
This season, The block delivered a challenging and realistic description of what it’s like to renovate a property and take it up for auction in hopes of making a life-changing profit.
It can be immensely rewarding, as it was for Omar and Oz, but it can also be risky, as it was for the three teams that would not have broken even yet, given the time and effort they put into their properties.
It may also be worth spending a thought on the Kiwi contestants in their version of The block through Tasmania. For the four teams, the total profit on their properties was just $NZ4,100 ($A3,732). Sponsor of the program, TSB Bank generously gave away the teams that did not make a profit or received any prize money of $10,000 for their hard work.
balance the scales
Although it could be said that the increase in interest rates is a factor that contributes to the result The blockThe finale produced and has definitely weighed in on the broader auction market across the country, there is something of a mitigating factor that has worked in the markets’ favor in recent months.
Auction volumes have dropped significantly since this time last year, as have new listing numbers. With fewer properties under the hammer and fewer listed for sale, the impact of reduced borrowing power and declining buyer confidence driven by rising rates has somewhat mitigated.
For example, in the Victoria region, where this season of The block was filmed, the number of new listings for October was down 11.1 percent compared to this time last year.
At the capital city level as a whole, new listing volumes for October fell 21.2 percent compared to this time last year.
Sydney and Melbourne have benefited from this trend in particular, with new listing numbers down 31.2% in Sydney and 29.2% in Melbourne. However, one state bucked the trend, with listing volumes up 26.5% in Hobart and regional Tasmania up 6.1%.
A benchmark for changing perspectives?
While the writing has been on the wall for a while regarding the challenges facing real estate in the future, not in the past decade has it been displayed in such an emotional and confrontational way for 1.7 million Australians directly on their television screens.
for the longest time The block was seen by many as helpful televised proof positive that it was hard to go wrong when investing in property, but as the real estate investment environment becomes more challenging, The block it can foster something like a reassessment of that perspective.
Tarric Brooker is a freelance journalist and social commentator | @Avid Commenter