November Property Auction Market Update

Just A Blip, Or A Sign Of Things To Come..?

October is traditionally a busy month at the auctions, following on from an also traditionally busy September. It is a time of year when the auction results steady down and can often serve as a barometer of the property market generally.

But October 2022 has been a pretty volatile month in the UK – both politically and economically. Another new Government, and another new Prime Minister, has ushered in another set of new policies (not to mention a further interest hike). In many ways, these are diametrically opposed to those of the previous one.

So, in these uncertain times, what happened in the UK auction market in October 2022?

As expected, plenty of lots

Reflecting usual seasonal trends the auction rooms were indeed fairly busy in October. A majority of the auction houses we track held sales this month. Although this was with the notable exception of a few large auctioneers including Allsop Residential – probably due to their having a large sale in September and another due this week.

This month, lot numbers were almost equally split between online auction and live/live-streamed sales.

In the live/live streamed arena Barnard Marcus held the largest sale (286 lots) with Bond Wolfe, Savills and SDL Auctions all offering 100+ lots.

Online, the Auction House network offered the largest number of lots at 519, also making them the largest auction house by lots offered overall.

In total, 2,480 lots were offered in October at the auction sales we track. This was a fairly modest 15% reduction on the number of lots offered in September.

Percentage sold – varies considerably, drops slightly

Success levels at auctions in October showed considerable variation in percentages sold, to say the least.

Two auction houses, Maggs & Allen and Phillip Arnold Auctions, recorded a creditable performance by selling all of the lots they offered (although only 15 properties in total). However, at the other end of the scale, one online auction house only managed to get 4% of the lots they offered away.

Percentage of auction lots sold dropped marginally in October. Overall around 67% of lots offered were sold last month. This compared to 71% in September and 67% in the traditionally slow month of August and was also down on general trends in recent years.

The chances of selling at a live/live-streamed sale this month were slightly better than online at 70.4% versus 64.4%.

Amount raised down, but by no means bad

The amount raised at the sales we track was around £268m from all kinds of sale in October. This showed a downward trend, and a fall of around a third from the approximately £404m raised in September.

Given that the number of lots offered was down anyway this might not necessarily be a sign of any deceleration in the market however. Indeed with fewer of the lots entered sold it could be considered a positive in some ways. It could indicate that those lots which did sell performed well.

Summary

As we said in our introduction, October was a volatile month in politics and the economy. That must surely have some bearing on sentiment in the auction rooms.

But it is as well to remember that any external forces like this have an unusual impact on the auctions market: Once a seller enters a lot it will, more often than not, make it to the sale room – perhaps with the odd tweak to the reserve. Auction buyers, however, are not similarly committed. They can drop their maximum bid, or decide not to bid, until the very last moment depending on how they feel on the day.

In short, external factors affect buying sooner than they affect selling.

Perhaps of some concern to sellers and auctioneers alike was that lots offered, percentage sold and amount raised all dropped in October in what is normally a good month for selling. However, it is almost certainly too early to tell if this was a blip or perhaps an adjustment towards new market conditions.

Looking forward, November is going to be another really interesting month for auctions results. Like the other autumn months it is traditionally a busy month, as sellers and buyers look to do business before the Christmas slowdown. But with another interest rate hike and another financial statement cum mini-budget due – and this time perhaps promising tax rises not cuts – everyone in the industry will be very keen to see what affect this has on activity in the auction rooms.

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