A warning is going out today from the UK’s largest property auctioneer about the sensible pricing of property coming to the market in the second half of 2023.
This will be of particular relevance to buy to let landlords seeking to sell at auction if they are unable to afford to keep their rental investments in the current high interest rate environment.
Auction House managing director Jeremy Prior says: “Buyers are becoming increasingly thin on the ground, although those that are still in the game are more driven, committed and engaged than ever before. But if you’re trying to sell property in a market like this, you need to ensure that you have two things on your side: professional advice and pragmatic pricing.
“The advice will vary, depending on where in the UK you are selling. There’s no ‘one size fits all’ guidance that will apply to everyone, everywhere … Then there’s pragmatic pricing. When one of our local auction experts suggests a guide price for a property, they are doing so because it’s designed to both accurately reflect a realistic figure for what is being sold, whilst also ensuring that it attracts the maximum number of potential bidders.
“This is not about being negative or pessimistic. The competitive nature of the bidding process means that once bidders are on board, they are often reluctant to pull out, eventually resulting in a higher sale price. But crucially, each property has to be guided at a figure which will attract initial levels of interest.”
Prior is reporting that despite the widespread economic gloom right now, Auction House enjoyed a record second quarter in 2023.
Q2 sales have risen from 988 in 2022 to 1,225 this year and money raised is up from £155,322,545 to £171,864,939.
“What’s remarkable about these figures is that the property market is getting increasingly more challenging and yet our sales figures continue to rise. As auctioneers, we’re having to contend with a toxic combination of increasing interest rates and decreasing levels of confidence as well as political uncertainty both at home and abroad. However, the underlying belief in bricks and mortar as a secure medium to long term investment remain and there are some fantastic opportunities out there for the canny investor” suggests Prior.
He concludes: “Auctions are often ahead of the curve when the housing market is about to rise or fall. The trouble with private treaty sales at the moment is that estate agents and vendors try to hold onto unrealistic high prices for far too long – and then wonder why they’re not selling.
“Disillusioned customers are constantly coming to us from estate agents, saying that their deals keep falling through, or that they have been waiting to sell for months. The beauty of auction is that we can let the market find the correct level for your property and more often than not sell it within weeks.
“A challenging property market like this does throw up fantastic buying opportunities for those who are looking to the medium or long term. But as far as successful sales are concerned, it’s never been more important to seek the right advice and get the pricing correct.”
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