News

Allsop residential auction hits 78% success

News

Estelle Maxwell

21 September 2010

Residential

Location continues to play a key role in auction success rates as witnessed at Allsop’s two-day residential sale last week.

The auction – which took place at the Cumberland hotel, W1, on 14 and 16 September – raised £38m, a 78% success rate with 282 of 370 lots selling, including 22 prior.

This was down from an 83% success rate in July when £43m was raised.

Auctioneer Gary Murphy said: “There is no doubt that the correction we witnessed in July heralded tougher times ahead. The market has since weakened further.

“The recession has brought with it a flight to quality as debt-starved investors shun risk and stick top safer locations.”

Southern properties remain the most sought after lots by investors, with 207 of 232 lots in the south-east selling and raising £28m.

However, less well located investment stock only managed to attract bids at yields well into the double digits, which Murphy said reflected the risk of a difficult sale in the event of vacant possession. Lot 50, an assured shorthold tenancy in Middlesborough, Cleveland, sold at a yield of 21%, while lot 95, a similar property in Prestwich, Greater Manchester, sold at a yield of 16%.

An analysis of Allsop’s results also revealed that 100% of all regulated tenancy investments sold at the auction, while 79 out of the 80 ground rents on offer also sold.

Highlights from the sale include 29 Argyle Road in Ealing, W13, which sold with planning permission for conversion to seven flats. It was guided at £750,000 and sold for £960,000. A freehold, three-storey building containing 23 studio flats, a one-bedroom flat and detached two bedroom block sold for £1.2m – the top of its guide.

More than 80 properties were withdrawn prior to the sale, “for a variety of reasons including debt resolution, change in circumstances and being in the clients best interest,” said Murphy.

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Location continues to play a key role in auction success rates as witnessed at Allsop’s two-day residential sale last week. The auction – which took place at the Cumberland hotel, W1, on 14 and 16 September – raised £38m, a 78% success rate with 282 of 370 lots selling, including 22 prior. This was down from an 83% success rate in July when £43m was raised. Auctioneer Gary Murphy said: “There is no doubt that the correction we witnessed in July heralded tougher times ahead. The market has since weakened further. “The recession has brought with it a flight to quality as debt-starved investors shun risk and stick top safer locations.” Southern properties remain the most sought after lots by investors, with 207 of 232 lots in the south-east selling and raising £28m. However, less well located investment stock only managed to attract bids at yields well into the double digits, which Murphy said reflected the risk of a difficult sale in the event of vacant possession. Lot 50, an assured shorthold tenancy in Middlesborough, Cleveland, sold at a yield of 21%, while lot 95, a similar property in Prestwich, Greater Manchester, sold at a yield of 16%. An analysis of Allsop’s results also revealed that 100% of all regulated tenancy investments sold at the auction, while 79 out of the 80 ground rents on offer also sold. Highlights from the sale include 29 Argyle Road in Ealing, W13, which sold with planning permission for conversion to seven flats. It was guided at £750,000 and sold for £960,000. A freehold, three-storey building containing 23 studio flats, a one-bedroom flat and detached two bedroom block sold for £1.2m – the top of its guide. More than 80 properties were withdrawn prior to the sale, “for a variety of reasons including debt resolution, change in circumstances and being in the clients best interest,” said Murphy. To access all EGi news stories and commercial property data sign up for a free trial today, or visit the subscription options page to find out more.