Guide prices are remaining steady and there are no signs of the dip that some commentators predicted when Britain voted to leave the EU.
There has been a lot of speculation on property prices, both before and after the Brexit referendum, alongside various interpretations of what the slightest percentage movement either way could mean for the UK property market.
However, I am convinced that indications so far show that Brexit not only has had minimal impact on auction sales, it looks like it is going to boost sales in the months ahead.
Project fear has turned into project sell.
By that, I mean there are still many
buyers and sellers for a wide variety of property types. We are seeing plenty of
potential buyers turning up at property viewings across the UK, confirming that there is still a great deal of enthusiasm in the market.
After all, we have had Andy Haldane, the Bank of England’s chief economist, telling us that owning property is a better bet than a pension. If that’s not a vote of confidence, I don’t know what is.
There is clearly more positivity in the market from senior players and this is reinforcing the idea that bricks-and-mortar assets are still worth considering despite the economic or political uncertainty.
In general, I am seeing property prices showing a good deal of resilience, both on the open market and in the auction room. We’ve held auctions straight after the referendum that generated up to 80% sales rates, proving that, despite seasonal and political factors, there are plenty of buyers and bidding is still competitive.
In the auction sector, we are seeing no changes to guide prices. After all, the objective of the guide price is to stimulate interest and get people starting to bid.
At our last auction, we saw a terrific amount of bidding, which indicated that there are still real opportunities for vendors to sell and buyers willing to buy – good news for both parties.
But the reserve price is also important when dealing with vendors in the post-Brexit market. There is always going to be a trade-off here, but the keen auctioneer will understand the market in the property’s location and be able to help with an accurate valuation based on location, property type, intended purpose and of course, the condition of the property.
In recent years, we have seen the state the property is in becoming a major factor determining price, and not in the way you might expect.
In the past few years, properties in need of renovation have sold well – developers have snapped them up at below-market prices in order to renovate and maximise their yields, by extending them to create more rentable units or converting them to other, more profitable, uses.
After all, with the housing crisis as it is, good-quality renovation projects are vital for the private rental and purchase sectors to provide a steady supply of good stock and the auction room is still the ideal place to sell and buy this type of property.
For online auctions, we are seeing a different response to property condition. For remote bidding, our experience is that fully refurbished properties that are “ready to go” sell best. Such properties remove concerns from remote bidders about the property’s condition and help maximise bidding when there are no immediate face-to-face counter bids as experienced in the auction room.
It is in everyone’s interest to help make sure a property sells quickly at the first auction it is in. If we keep a close eye on the market and continue to promote the positive aspects of auctions, we can look forward to a good number of sales, despite what may be happening in the broader political and economic spheres.
Having discussed the current market with our clients over the past few months, it is clear that auctions remain an excellent way to transact. Selling to a defined deadline and buying at a competitive price are still top of the list for landlords and buyers and the auction room remains one of the best places to achieve these mutual benefits.
So it is business as usual in the auction world and, looking at the volume, value and type of property coming up at auctions, we, and the rest of the auction industry, should have plenty of buyers and bidders looking to make their next purchase.
