An owner-occupier this week snapped up a grade II-listed triplex apartment on Regents Park, NW1, post the Allsop sale for £6.5m, as market uncertainty fuels an increase in activity after auction.
The property at 4 Cambridge Gate – one of the most prestigious and sought-after terraces in the Crown Estate – was offered by Allsop with a guide of £7m at its residential sale on 25 October. However, the receivership lot failed to meet its reserve in the room.
Its subsequent sale for £500,000 below its guide helped push the total raised to £42.6m from 168 lots, a 76% success rate. Partner and auctioneer Gary Murphy said the sale at the Cumberland Hotel, W1, started strongly with “plenty of hands going up” but got “a little stickier towards the afternoon and evening” as expected.
In a further sign of hesitancy in the market, close to 60 lots were withdrawn prior to sale.
“At the moment the market is such that the option [of withdrawing prior to auction] is being used more often. There’s definitely an increase in withdrawals, but not a massive spike,” Murphy said.
Lack of buyer interest during pre-auction marketing is one of many reasons why lots are withdrawn. “If a property goes to auction and doesn’t sell, it can affect the prospects of that property going forward. It weakens the bargaining position of the seller,” Murphy said. “We need to put the option [of withdrawing] in front of our clients.”
Other factors may include reasons personal to the seller or a decision to negotiate with a single party.
Murphy said current market conditions were also creating an increase in activity after the auction, as seen with the Cambridge Gate lot. “All buyers want to buy at the best price they can and drive a hard bargain afterwards. We know where the bidding has stopped and that will give us a clue as to where we can sell.”
He added: “There’s no doubt it’s a challenging market. There’s no normal.”
Highlights from the room
■ Semi-detached HMO (freehold), Kilburn, NW2, containing seven bedsits with one vacant; sold for £980,000 (a 3.57% yield) against a guide of £950,000-plus.
■ Purpose-built block of 24 flats (freehold), Newcastle-under-Lyme, Staffordshire; sold for £930,000 (a 10% yield) against a guide of £930,000-plus.
■ Repossessed house (freehold) divided into a flat and maisonette, Hackney, E8; sold for £850,000 against a guide of £850,000-plus.
■ Two purpose-built blocks containing eight flats let on ASTs plus ground rents, Bingley, West Yorkshire; sold for £735,000 (a yield of 8.32%) against a guide of £650,000.
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