A two-storey Erskineville semi sold for $2.91 million at auction on Saturday to an overseas buyer who the selling agent said had purchased it for his children to live in while studying at university.

About 30 people, including several neighbours, gathered in the open-plan living area at the rear of 59A Prospect Street to witness the auction of the four-bedroom, three-bathroom architecturally designed home.

The property had a guide of $2.5 million and sold for $260,000 above the reserve of $2.65 million.

There is no legal requirement for a vendor’s reserve to be in line with their property’s price guide.

Six parties registered to bid, with bidding opening at $2.52 million. Two parties initially battled it out in increments of $10,000, $20,000 and $30,000. When bidding reached $2.65 million, two new bidders entered the fray, with 15 bid increases of similar sizes going back and forth between the two.

A final bid of $5000 ended the spectacle with the underbidders, a couple with a child who own a property further west but rent locally, quietly saying “I think we’re out”.

A lawyer acting on behalf of the successful bidder said his client was based overseas.

Records show the property on the 144-square-metre site last sold in 2016 for $1.92 million. The property was one of 428 scheduled to go to auction in Sydney on Saturday.

Ray White auctioneer James Keenan said key elements made the home attractive to buyers in an otherwise unpredictable market.

“People are paying a premium now for properties where the work has been done, which has a lot to do with [rising] building costs. It’s also in a great location,” he said.

Ray White Erskineville sales agent Shaun Stoker said while vendors are “starting to align with buyers” in price expectations, confidence was yet to return to the market.

“There is still uncertainty because buyers are not jumping to put their properties on the market,” he said. “I don’t know that [we will see confidence returning] by spring – the beginning of next year is more likely.”

One of the vendors, who was present at the auction, said that while it was “very difficult to move” because her family had enjoyed the close-knit local community, an “outstanding” property closer to the city had convinced them to make a fresh start, so they bought it.

In Lane Cove, a local family with a young child paid $1,463,000 for a three-bedroom apartment after it passed in at auction on Saturday.

Bidding for the property at 2/15 Longueville Road opened at $1.38 million, increasing in bids of $10,000 to reach $1.45 million when things stalled and it passed in. The lead bidder was then invited to increase their offer and, after half an hour of negotiating, the property sold.

The apartment had a guide of $1.4 million and a reserve of $1.5 million.

Two bidders registered, although Raine & Horne Lower North Shore sales agent Oscar Nicholls was initially expecting only one. The underbidder was an investor who had seen the property once early in the campaign and was attracted to it for its yield potential, Nicholls said.

“He got to a point [in the bidding] and said ‘at this price point it doesn’t make any sense’. He has a couple of investments which he is holding because rents are up,” Nicholls said.

The vendor was a single-parent family who bought a four-bedroom home. Nicholls said market conditions were good for upsizers.

“She got a really good deal on what she bought,” he said of the new property.

In Bondi Junction, negotiations continued after a two-bedroom art deco apartment passed in at $775,000.

Two parties registered to bid for 2/143 Old South Head Road but just a single bid of $750,000 was placed when the auction opened. The lead bidder, a first home buyer renting in Paddington, was invited to advance on their offer with a further bid of $775,000 before the property passed in.

The apartment, sold as a deceased estate, had a guide of $800,0000 and a reserve of $850,000. It is one of nine apartments in a block positioned between Bellevue Hill and Bondi Junction and features high ornate ceilings, timber fretwork and picture rails, typical of the era.

A sales agent for Ray White Eastern Beaches, Angus Gorrie, expects the property to sell next week.

“It takes a bit more time [to sell in this market], but we had two registered buyers, and we are getting close,” he said. “People are out there – the market is better than it was in June.”

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