Behind the Hammer – Inside The Block 2025 Daylesford Auctions

Behind the Hammer – Inside The Block 2025 Daylesford Auctions
By Mark Errichiello Co‑Founder & Director, Master Advocates Real Estate Services Pty Ltd

Independent Buyers & Vendors Advocate & Investment Property Management Advisory

Sunday 26 October 2025 marked the grand finale for The Block Season 21 in Daylesford, Victoria. The lights dimmed, the house‑cams flickered off and the auction paddles rose. As an independent advocate standing beside the wallet of a high‑net‑worth principal, I watched it all unfold. It was a day of drama, silence, and strategy — where timing meant everything.

The Setting: Daylesford 2025 & The Block Build

The show relocated to a brand new estate on the fringe of Daylesford — the Middleton Field subdivision. Five mirror‑floorplan homes, loaded with high‑end finishes across half‑acre (approx) blocks. The price guides: $3.0m to $3.3m. Regional tree‑change towns like Daylesford have medians much lower than these guides — making the task ahead steep for the sellers and their advocates. This particular subdivision of brand new houses was set on the fringe of the main road into town, approximately a 10 minute walk to Vincent Street Activity Centre and adjacent to an industrial precinct. The part that was not highlighted was the brand new high density house and land subdivision being developed to the rear of the Block Houses with new dwellings set to be constructed right up close to the rear boundary. This all has an effect on sentiment and tap out price and perceived value when comparing data in the location and comparable sales history. Property types, attributes, fixtures and fittings, quality, age of property, land area, use and specific location. Are they closer to the lake precinct, main activity centre, heritage bushland and national parks or the industrial precinct? The Block houses will have partial scenic views of the neighbouring heritage protected bushland and rolling hills of Daylesford and views of the new estate to the rear of the properties.
Trying to auction Five similar neighbouring properties at a high end value proposition to set record results, in a Regional town, with one group of limited buyers and auctions conducted consecutively in the same day is a herculean effort to achieve. The odds for success of all of the house sales were grim based on the vendor reserve price expectations.

Price Guides vs Real‑World Bids

While guides were lofty, the bidding floor painted a different picture. Reports from the floor indicated that buyer sentiment hovered between $2.8m and $2.97m, particularly on the properties that ultimately passed in. Two houses did not sell under the hammer, despite the anticipation. The highest successful sale landed near $3.41m, while others stalled short of reserve. The gap between guide and bid was real — and instructive.

My Role Behind the Scenes

Having operated similarly in the 2024 Phillip Island season for Adrian Portelli of LMCT+, I entered this auction with quiet focus and clear intent. Whispers again filled the crowd that I might be representing Portelli — but as always, I neither confirm nor deny who I am representing. In any property pursuit, who I am representing is not my information to disclose, that is my client’s right to disclose. We will maintain the anonymity of any client we represent until deemed necessary to disclose post a successfully executed purchase and with the consent of our client’s.
Sometimes, the mystery is the strategy itself. By leveraging the uncertainty, I observed behaviours, watched closely, listened carefully, and acted only when it served my client’s agenda, criteria, and budget. We either bid if the opportunity and price is right or we tap out and walk away. Sometimes when a property passes in, there is a true reality check for vendors and social proofing effect that can be an advantage for the purchaser if they still wish to pursue a property. The negotiations that proceed a passed in auction can be beneficial. In this case it would have been a $310,000 + haircut from vendors expectations based on the winning House 3 auction sale of $3,410,000 compared to their vendor bid benchmark when deciding to pass in House 1 at $3,100,000. My client still decided to not treat any further in negotiations and withdrew interest from the property. Sometimes you have to be willing to lose and walk away to win in a negotiation or at least realise the vendor’s position. Information, knowledge and experience is leverage in a negotiation.

Auction Day Dynamics

The crowd arrived early, full of expectation. Buzz in the air. Initial bidding moved cautiously. Many registered buyers and agents discussed budgets capped around the high‑$2 millions, but hesitation lingered. Mid‑day, vendor bids began appearing roughly $100k above reserve — shifting the energy. The atmosphere changed; what was a competitive rhythm turned reflective, as bidders weighed emotion against discipline.

The Block Daylesford 2025 Auction Day Results

House 1
Passed in $3,100,000
Vendor Bid

House 2
Passed in, $3,100,000
Vendor Bid

House 3
Sold under the hammer $3,410,000
(WINNING HOUSE)

House 4
Sold under the hammer
$3,060,000

House 5
Sold under the hammer
$3,099,000.10

Buyer Psychology in Action

From an advocate’s vantage point, the psychology was textbook. Buyers anchored firmly around sub‑$3 m figures, despite show‑day pressure. Some who might have gone higher chose silence instead — perhaps wary of overpaying in a market already at a premium. The dance of bids slowed into a measured waltz of value perception.

Vendor Behaviour and Reserve Strategy

Reserves were set ambitiously, and the estimate guide ranges were high also. Vendor bids on the properties which passed in — positioned $130,000 above the top competing bids — added pressure, though arguably at the expense of natural market flow. In any market, perception matters, and buyers sense when the balance tilts. This was notably frustrating for the sales agents forced to take a vendor’s instruction to submit a vendor bid at $3,100,000 and pass the property in $110,000 greater than the initial reserve price. Vendor’s are within their rights to withdraw a property from the market or change a reserve price at anytime, providing the reserve price has not been reached and public declaration by the auctioneer has not been made stating the reserve price has been reached (“we’re on the market”) or exceeded and the property is selling to be sold to the best and highest price bid after the third and final call by the auctioneer… In this situation at the Block auction, the optics were harsh and televised on national television which amplifies the pain. Particularly for the contestants that put their hearts and souls into the houses for months and the agents that put a fair and worthy effort into the campaign without a successful sale on the day of auction.

The vendor in the Block scenario is also the network and developer of the site that holds the risk and controls the decision of price setting and instructions.

Unfortunately the market is dictated by the buyers and they only care about fair market value and subjective admiration of the target house, land and location in the current time and the future enjoyment or potential it can afford them. The circumstances of the vendor and their expectations or strategy, sales agent position and in this unique scenario the contestants, is not factored into the feasibility and price setting of the buyer mindset.

Reflections & Market Outlook

Daylesford’s 2025 Block finale proved one thing: televised value and true market value can part ways under the spotlight. I wish all the best for a successful sale of House 1 and House 2 that passed in. There is a chance that within a relatively short period of time and continued private sale negotiation post auction, a fair and reasonable price will be offered and properties sold.

Next year’s move to Mount Eliza promises a different rhythm — a stronger location alignment and Melbourne on a good trajectory for capital growth based on sentiment and activity in the September Quarter. Mt Eliza will naturally attract a greater price point and buyer expectations. For me, as a professional advocate, the goal remains constant: conduct our research and local area due diligence, establish our opinion of estimated purchase price range based on the quantified building and land value, position of the property on the street and location, get ready with a bidding strategy, stay quiet, stay observant, act decisively only when it aligns with my client’s interests.

The Hidden Burden Behind Every Build

Separate to the Block Houses, rather a general perspective of the underlying pressure associated with the private residential construction industry at present is the risk builders and developers face with costs and taxes that contribute to the final realised sale price in the housing market that is effecting supply and affordability.

In today’s volatile property market, it’s easy to overlook the quiet burden shouldered by those driving new housing supply — the vendors and developers. Beyond the glossy marketing campaigns and televised auctions, these are the parties carrying the weight of risk, holding costs, and upfront funding for every venture.

While marketing, advertising, and sponsor contributions can help generate exposure, they rarely offset the sheer scale of financial pressure now embedded in the system. Land acquisition prices have surged. Construction costs continue to climb. Inflation in materials, labour, planning, property taxes, insurance, and interest rates during the holding period have all escalated dramatically over recent years — each adding layers of risk until the day of sale.

These compounding costs ultimately shape the price a buyer sees on the contract. They influence how land value, building worth, and depreciation are calculated — and in turn, how affordability is eroded. Even in the median-priced market, developers face the same cost barriers, making it increasingly difficult to deliver fair and attainable homes.

Australia’s housing affordability and supply crisis has become impossible to ignore as our population and demand increases rapidly . It’s time for a meaningful review of property taxation and the financial frameworks that weigh down those creating housing supply. Developers and vendors who take on the risk and capital outlay to bring new homes to market should be incentivised, not penalised — through tax reform, targeted subsidies, and planning efficiencies that reward contribution. The added volume of supply will naturally deliver some more affordable housing options. This will also open the pathway for more residential investment opportunities and subsequently increase supply and affordability in the rental market.

If we want to restore genuine pathways for first-home buyers, stabilise rental markets, and support sustainable growth, the system must evolve. Housing supply depends on those willing to invest, innovate, and build — and they deserve a fairer framework to do so.