The UK property auction market continued to gain momentum in June, with a surge in stock levels suggesting more investors are using auctions to restructure portfolios as the property market adapts to the Renters’ Rights Act.
Figures from the Essential Information Group (EIG) show 4,008 lots were offered across the UK during June, a 35.3% increase on the same month last year. Sales rose by 31.3%, while the total value of property sold climbed 33.5% to £519.7m.
Although the national success rate eased to 65.3% as supply outpaced demand, activity increased across both the residential and commercial sectors, highlighting continued investor appetite for auction stock.
David Sandeman (main picture, left), managing director of Essential Information Group, says the increase in available properties could be linked to landlords reassessing their holdings following the introduction of the Renters’ Rights Act in May.
He adds: “Overall, the auction market continues to build on the momentum seen throughout the first half of the year. While higher stock levels are continuing to place some pressure on success rates, the increase in activity could also reflect landlords reviewing their portfolios following the introduction of the Renters’ Rights Act in May. As the market moves into the summer period, activity levels remain healthy, supported by a steady flow of stock and sustained buyer demand.”
REGIONAL DIFFERENCES
Regional performance remained particularly strong in the South West, Yorkshire and the Humber and London, with the capital recording more than 20% year-on-year growth in both lots sold and total funds raised.
For the specialist finance market, the continued growth in auction activity is likely to be welcomed by bridging lenders and brokers, with higher transaction volumes typically driving demand for short-term acquisition finance, refurbishment loans and auction exit strategies as investors seek to reposition assets in an evolving regulatory landscape.
Stuart Collar-Brown (main picture, right), NAVA Propertymark President, says: “The UK’s auction market continues to deliver positive results, with lots increasing by 35 per cent year on year and sales increasing by 31.3 per cent. This shows that both buyers and sellers continue to see the value of auctioning their property as they seek certainty in a turbulent economic climate.
“Regional growth also remains strong, with the South West and Yorkshire and the Humber delivering positive results and helping to drive the market. As legislative changes continue to affect the UK property sector in different ways, this may explain the differences in commercial sales volumes and the overall value raised, as investors favour longer-term leases and the security they offer over the now-defunct Assured Shorthold Tenancies in the residential market.
“As long as properties are priced realistically to create a competitive bidding environment, it is encouraging to see the auction sector continuing to deliver growth.”
