April Property Auction Market Update

The Auction Market Remains Steady This Month…

Introduction

Spring is normally the time of year when home buyers start to think about moving and developers/investors start to think about their next project. This flurry of interest normally finds its way into the property market, as well as the auctions market itself.

These are far from normal times of course. The progress of the economy is still very uncertain. Although, after a turbulent end to 2022, things have stabilised somewhat this spring.

When asked whether the current economic climate might be causing auction buyers to be more cautious at the moment the answer from our auction experts was both ‘yes’ and ‘no’ – it depends!

You can read their thoughts here: Are Auction Buyers Being More Cautious This Spring?

So what exactly happened in the UK auction market this March? Let’s look at the facts and figures.

March proved similar to February in some ways

Returns from the residential auctions we track suggest the market held steady in March. Although the market was busier than most of the winter months there was no spring surge. Some key statistics were, in fact, very similar to those of February 2023.

In March 2023 3,102 lots were offered at the sales we track. This was similar to the 2,916 lots offered in February. The online -v- live/live streamed split was similar to previous months whereby a small majority of lots continue to be offered only online.

In the online arena the Auction House network offered 556 lots and raised £65.6 million. (As an aside 195 lots were offered and £30.4m was raised in the capital alone by Auction House London.) Allsop Residential and McHugh also held very large sales by lot numbers.

Savills claimed top spot for the largest amount raised in the live arena. They offered 318 lots and raised £84m – just short of twice the amount they raised in February. Barnard Marcus offered a slightly larger number of lots (338) and raised £32m.

Percentages sold decline compared to recent months

There was a particularly wide spread of success rates in March with a handful of sales selling 100% of their lots while one auction house only managed to get 23% of their lots away. (These outliers, whether high or low, typically refer to sales with only small number of lots entered.)

As to the percentage of lots sold overall this was 69% for online sales and 71% for live/live streamed sales. The overall sales rate declined a few percentage points compared to recent months, although it was broadly in line with long term average sales rates. Although it may only be a blip, the live/live streamed sales rate declined notably from a healthy 84% in January and 77% in February.

Amount raised stays steady

The overall amount raised at residential auctions in March was also broadly similar to that raised in February at £385.43m, with almost a 50-50 spilt between online and live sales.

One last statistic that may (or may not) prove interesting to auction watchers is that the average value of a property sold at a residential auction in March 2023 was just £128,000 approximately. This compares to the average property price of £289,000 based on the latest HM Land Registry figures (January). It’s difficult to say whether this statistic is meaningful in any way or not. While auction property can often sell at under market value it probably doesn’t often sell that far under market value.

Summary

A fair summary of the residential auctions market last month might be …. steady as she (or he) goes.

That might come as a surprise in many ways after the economic shocks over the last six months. Then again, in more recent weeks, while the Spring Budget didn’t do anything to encourage the property market it didn’t do anything much to deflate it either. The market also seems to have become more accustomed to the interest rate rises which hit the market last year, with some suggestion that rates may have peaked.

So while the business being done in the auction market is not spectacular at the moment – there has been no spring bounce as yet – business appears to be holding up pretty well. Sellers are selling, although there is no rush for the door. Equally buyers are out there and willing and able to buy.

It would probably be wrong to think that the market will remain this steady for the rest of the year. The much-heralded fall in residential prices has only been miniscule so far. Most experts are forecasting there will be steeper price falls this year or next before the market starts to recover in 2025. As ever, it will be interesting to see what happens at the auctions over the next month.

Check out our monthly updated statistics below, courtesy of the Essential Information Group (click on the key colours to highlight / dehighlight).