December Property Auction Market Update

Market Slows – Blip or Trend?

Following a busy autumn season so far, what happened at the residential property auctions in November 2024? In our regular monthly update we will take a closer look at sales volumes, percentages sold, amounts raised and other trends in the UK residential auctions market.

Number of lots offered

So far in 2024 the auctions have been doing brisk business. The numbers of lots offered have been coming on in leaps and bounds. That has prompted many to ask, could this continue long term? Sooner or later, would the market drop off?

The answer is that, in November 2024, the market did slow down. Numbers of lots offered were the lowest number all year – apart from the traditionally slow months of January and August. Only just over 2,200 lots were offered at the auctions we track. This was 20% or so below the long term average.

Several auction houses didn’t hold sales, which may explain the lower lots numbers. However there were substantial sales from the main auction houses especially Savills, Barnard Marcus and Auction House.

Percentages sold

Very generally, entering a house into an auction over 2024 has come with a 70%-plus chance of selling it (and in some cases an almost 75% chance). However, sales rates tailed off at the auctions we tracked in November. They dipped to around 67% – a noticeable drop though still pretty reasonable in the scheme of things.

Looking at individual sales, only a handful of sales sold 80% of their lots including two sales which sold 100%. The lowest success rate this month was 29%.

Amount raised

The total amount raised from properties sold at auction in November was well down compared to the last couple of months. Around £338m was raised compared to around £605m and £872m in October and September respectively. This amount was the lowest all year except for the traditionally slow months of January and August. It was around 20% below the long term average and, perhaps more notably, was around a third down on the amount raised in November 2023.

Average amount per sale

The average price of a house sold at auction in the UK in November 2024 held up well and was similar to last month at £148,600. This is around half the average UK property price according to UK HPI figures.

Comment

Ben Hodge, Director (Auctions) at Savills says of their residential results this month: “Across the residential side there was more caution, suggesting that some buyers are responding to recent interest rate increases while others are holding out until the new year.

“However, well priced stock transacted well, receiving competitive bids and selling above guide. Interestingly, London flats were a category that stood out on the day with apartments in prime locations such as Wimbledon, Islington and Chelsea selling well.”

Summary

November is generally a busy month for residential auctions. But in November 2024 the market seemed to slow notably. All the statistics softened, with numbers of lots offered and the amount raised both falling around a fifth compared to longer term trends. While these falls are not a cliff edge by any means they are noticeable.

When looking at reasons, the Budget at the end of October may have been one of them. Most commentators seem to agree that it was not positive for the economy, and it may have affected buyer sentiment at the November auctions. Residential property escaped the much-predicted increase in Capital Gains Tax. However the employer’s National Insurance hike led to many gloomy predictions from employers and this, as well as the 2% second property Stamp Duty increase, may have prompted residential sellers, buyers and investors to reconsider their plans.

Looking ahead, December is usually a pretty busy month for residential auctions before the usual annual winter slowdown. So it is very much a matter of watch this space as we enter 2025.