September Property Auction Market Update

Some Surprises This Summer

What happened at the residential property auctions in August 2024? In this monthly update we will take a closer look at current trends in sales volumes, percentages sold, amounts raised and other interesting trends in the residential auctions market over the summer period.

Number of lots offered

As might be expected in summer the number of lots offered at the auctions we track in August was well down compared to recent months. With around 1,400 properties offered this was the lowest offering of any month this year save January – across 2024 there have been an average of 2,600 lots for buyers to choose from each month.

However, something of a surprise this summer was that the auction sales were much busier than this time last year. There were around 60% more properties offered than were offered in August 2023.

Who held sales? Which were biggest?

Again as expected several auction houses shut down for the summer holidays. There were only a third as many sales held as a typical month – and in particular less than a handful of live/live streamed auction sales. Those sales handled more lots on average than in a normal summer however.

The Auction House network combined offered over 300 properties raising almost £39m in the process. Allsop Residential raised £34m from the sale of 141 lots .

Percentages sold

Over recent months the percentages of lots sold have been well ahead of historic averages, with three out of every four properties offered at auction selling. In July, the average sales rate across the auctions we track dipped to 68%. August’s sales rate was also below recent monthly averages at 69%.

Sales rates at the individual sales hovered around the average – even the lowest performing sales sold 54% of their lots. Allsop Residential’s sale was an outlier – 92% of all the properties they offered found a buyer.

These average sales rates are still pretty good in the scheme of things. But could this be a sign that sales rates are tailing slightly after the highs of recent months?

Amount raised

In August around £182.1m was raised at the sales we tracked. As might be expected due to the lower number of lots offered this was well down on recent months. It was also around half the monthly auction sales by value over the last year – this running average is currently in the region of £362m. But very significantly again it was still far ahead of August 2023 when only around £100m of property was sold.

Average amount per sale

The average price of a house sold at auction in the UK in August 2024 was around £127,000 – similar to last month but the lowest average price since January. This compares to the average UK property price of £288,000 (UK HPI figures).

Comment

Richard Adamson, managing partner and residential auctioneer at Allsop Residential, reports: “While August is typically a quieter month for property transactions, our recent auction proved popular, with over 2,000 bidder registrations. In the past four weeks alone, our residential auction team has achieved over £100 million in sales, boasting a success rate of 92%, well above the industry average of 75%. Despite a challenging market, our extensive experience continues to attract those looking to sell their assets quickly and at an attractive price. As we prepare for our September auction, early indications suggest it will be another large sale, with many investors looking to recalibrate portfolios in anticipation of a capital gains tax rise.”

Summary

It is never a good idea to read too much into the auctions returns for the middle of the summer. Like mid winter they are not usually that representative of the market as a whole. It is normal for the number of properties offered to be low. The most interesting takeaway however is, notwithstanding the slightly lower success rate, how much more business was done at the residential auctions market than in summer 2023.

Looking ahead, although the small interest rate reduction has arguably given a very slight boost to the property market, there is a potentially much more important market-related event on the horizon. That is the next Budget at the end of October, when a tranche of tax rises is being anticipated. So has August started something of a sell-off by investors? It is too early to say but the auction stats from September and October might confirm the direction of the market for the foreseeable future.

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