Auctioneers are the darlings of the UK property seller. Professional property traders are increasingly instructing estate agents less and less in favour of auctioneers which see a nine in 10 chance of a guaranteed sale on a set day. Auction sale after auction sale sees vendors attracted away from the private treaty market.
The second Acuitus auction of the year saw the sale of £53.32 million of commercial property assets and demonstrated the growing use of the auction platform for asset disposal. Acuitus auctioneer Richard Auterac comments: "Sellers are responding to the certainty and reach of the auction process. In the space of less than six weeks at our last two sales, we have achieved for one client alone unconditional sales of more than 40 properties. They have realised that this is a more efficient route to market and have achieved better prices than were being sought through private sales.
"We have sold more than £110 million of assets in the first quarter of this year which is 67 per cent more than in the corresponding 2015 period."
Actuitus's auction saw the sale of 67 properties at an average sale price of just less than £800,000. The highest price was achieved by a freehold retail investment at 13-14 The Parade, Canterbury. Comprising two shops in a prime location it sold for £2.7 million.
Mr Auterac says: "While Brexit and other macro-economic influences may have brought some uncertainty into the market for large-scale commercial property assets, there is now tremendous momentum in the sub-£10 million asset band which the auctionroom serves, and this is being increasingly driven by private investors. There are excellent opportunities for sellers to lock into this momentum."
The third Acuitus auction will take place on 19 May at the Radisson Blu Portman Hotel in London W1.
Lambert Smith Hampton's national auction team held its first ballroom auction of the year on 22 February, raising £13.5 million, with a success rate of 94 per cent. In an auction that spanned the UK, with properties on offer from Buckie, Scotland, to Ilfracombe, Devon, the largest lot sold was a freehold retail parade and doctor's surgery in Hertfordshire, which reached £2.4 million off a guide price of £1.5 million. At the other end of the scale, 5.29 acres of freehold land in Liverpool that is subject to 999-year leases at peppercorn rent, was purchased for £1.
A freehold residential/retail property in Woking that is suitable for development into up to 14 flats received the fiercest bidding, selling for £1.4 million off a guide price of £900,000. This guide price had already been increased from £820,000 after the first week of marketing, due to the high demand received. Previous to this sale, the property had been in the same family ownership for approximately 50 years.
LSH's next national property auction sale will be held on 9 May at Le Meridien on Piccadilly, London W1. It is instructed by clients including Durham County Council, Homes & Communities Agency and Severn Trent Water.
Allsop Residential raised £74.8 million from its first sale of 2016, 38 per cent up on its February 2015 total. The sale comprised 283 lots in total. Properties were spread across the UK and provided buyers with a broad choice of investments, vacant units and development opportunities.
Allsop auctioner Gary Murphy notes that higher value lots are increasingly prevalent in his sales. Nineteen lots were sold at £1 million or more and, of these, the average price was £2.82 million. Office buildings with permitted development rights are selling well as the auction method. Five of them sold for a total of £8.05 million.
The sale included a good selection of ground rents. Allsop sold 32 in all, many offering attractive reversionary value. And Allsop sold 29 lots on behalf of housing associations.
Mr Murphy says: "This is one of the highest sales totals achieved in recent years and a huge jump from our total sales this time last year. This could be due in part to some sellers looking to take advantage of what they hoped to be an increase in demand from buyers hoping to save the 3 per cent marginal stamp duty payable on second homes and buy to lets from 1 April. It was clear that competition across the board was keen."
With house price inflation in the south east often exceeding owners' earnings year on year, buyers are increasingly challenged. "The surge in single unit London values shows no sign of abating in the room," says Mr Murphy. "The average price achieved was more than £610,000 whereas outside the M25 the average figure was £153,000."