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In 2017, Allsop Residential Auctions raised a total of £425m, achieving a success rate of 79%, higher than 2016 (78%), and cementing its market leading position for 23 years running.

Last year, the residential market faced a number of challenges, including deepening unaffordability and significant political uncertainty on the back of strained Brexit negotiations and a General Election.

This has been compounded by the 3% stamp duty surcharge introduced in 2016 and tougher lending criteria hitting BTL investors with four or more properties. Despite this, Allsop’s residential team achieved a total only £7m lower than 2016. Across the UK commercial and residential sectors Allsop raised a total of £1.034bn, with an overall success rate of 82%.

In total 1,222 residential lots were sold with an average value of £348,000, compared to £356,000 in 2016. High value lots continued to remain popular in the auction room with 99 sales realising in excess of £1m.

Despite the political upheaval surrounding the April announcement of a snap General Election, May’s auction, which was the most successful of the year, raised a total of £74m and achieved a success rate of 86%, notably higher than in 2016 (80%).

However, the repercussions of growing political uncertainty in the wake of the election result were felt in July’s auction room. The first sale following June’s General Election raised a total of £52m and achieved a success rate of 76% – respectable, but one of the lowest of the year.

Confidence returned to the Allsop residential auction room in September with a £71m result and a success rate of 80% – £12m higher than in 2016 and topping all September residential sales figures on record. This was despite a backdrop of weak post-summer auction results elsewhere. It was a property in St. Ives in this auction that caught the imagination of the public and investors, selling for £1.44m from a guide price of £625,000+.

The weakening of sterling last year, a result of the UK’s decision to leave the EU, continued to spark demand from overseas investors and strengthened competition in the auction room. This is in line with recorded overseas interest in the Allsop online catalogue, which received more than one million visits from 194 territories globally, of which 48% were new visitors.

On analysing stock, 9% of assets offered in the residential auction room in 2017 were commercial, up from 7% in 2016. Despite this, the total raised from commercial lots offered was down from £56.5m to £37m as supply of high value commercial lots, which were most often vacant offices with the opportunity to convert to residential, have become scarcer.

The number of mixed-use lots sold, however, rose last year from 11% in 2016 to 12% in 2017. Despite this, the total value raised fell from £93.5m in 2016 to £87m in 2017.

The regional distribution of properties offered in 2017 remained broadly similar to 2016 with 59% of assets offered coming from London and the South East (60% in 2016). The average price of a single vacant unit in 2017 fell to £346,000 from £352,000 in 2016. The only region to show a marked fall in prices was Greater London, which fell from £622,000 to £561,000 in 2016 as unaffordability tightened its grip on the Capital. This is despite many of the country’s regional cities achieving growth; Manchester rose by 7.7% and Birmingham by 7.3% (Hometrack). This data is consistent with the auction room, where the average price achieved for lots rose in every region outside of the M25 except Scotland.

Gary Murphy, Partner and Auctioneer, commented: “Investors in 2017 remained active and cautiously optimistic in the auction room. As a result, we raised a similar total to 2016, proving that appetite exists for the right stock, sensitively priced.

“This year, BTL investors face further hurdles with the tapering of tax relief and tougher lending criteria applied to portfolios of four or more properties. We may see the smaller investor look to disinvest, whilst others will adjust their portfolios and seek value in the regions. Prices will continue their correction, particularly in London and the South East, where they are likely to remain static.

“2018 will not be without its challenges but there will be opportunities.”

Read the full Residential Auction Annual Review 2017 online. 


Notes to editor

About Allsop auctions

Allsop run the largest property auction departments in Europe through two highly experienced residential and commercial teams and is the UK’s number one auction house by transactions. We offer a wide range of lots covering residential vacant and investment properties, ground rents, land and development opportunities and secondary commercial lots. A minimum of six commercial and seven residential sales are held every year. Visit: https://www.allsop.co.uk/our-services/auctions/selling-at-auction/

About Allsop

Allsop is an independent property consultancy with a market-leading reputation for high quality service and integrity, covering the UK from our offices in the West End, the City, Leeds and Brighton. In addition to our position as the UK’s largest and most successful property auction house, we offer an extensive range of services for residential, commercial and mixed use property.

We have the people, the skills, the experience and the drive to maximise value for our clients in any given market and like to do business in our own distinctive Allsop style – open, friendly and honest. Clients appreciate this, which is why so many stay with us over the long term.

In an unpredictable world, Allsop remains a reassuringly constant source of market knowledge, insight and expertise. Visit: www.allsop.co.uk

Contact

For further information or supply of images

Redleaf Communications on 020 7382 4720 or allsop@redleafpr.com

Or

Anna Jones, Residential Marketing and PR Manager at Allsop on 0207 543 6728 or anna.jones@allsop.co.uk