"While the overall success rate dipped compared to the previous year, the total amount raised showed modest growth at 1.4% compared to the previous year. This dynamic reflects the motivation of vendors in the face of changing environments in both the Residential and Commercial sectors"
- David Sandeman - Essential Information Group
David Sandeman, Director, comments on the year that was, stating: "The property auction market has navigated through a complex landscape marked by rising mortgage rates, the cost-of-living crisis, and economic uncertainty. Despite these challenges, the resilience of the market is evident in the substantial 16.6% growth in the number of lots brought to sale."
Auctions showcased commendable results with a 13% increase in properties successfully sold under the gavel. However, the growth comes with cautious considerations.
Sandeman notes: "While the overall success rate dipped compared to the previous year, the total amount raised showed modest growth at 1.4% compared to the previous year. This dynamic reflects the motivation of vendors in the face of changing environments in both the Residential and Commercial sectors."
Delving into the residential sector, a surge in sales by 14.7% and a more conservative growth in total raised by 4.8% contributed to a year-on-year decrease in the average sale price to £168,453—a notable 8.6% drop from 2022. Sandeman suggests, "This decrease may be attributed to various factors, including variations in property type and size, as well as regional performance.
Despite this, positive indicators point to a rebound in buyer confidence, especially with the gradual reduction in mortgage interest rates, setting the stage for a potentially bustling January 2024."
In the commercial arena, a level of stagnancy suggests sustained interest from investors.
Sandeman advises caution, stating: "The drop in total raised for 2023 warrants attention for those planning transactions in the coming months. Understanding market dynamics will be crucial for informed decision-making."
Taking a regional perspective, Sandeman highlights: "Most areas experienced an upswing in overall metrics for the past quarter, with some variations in the residential/commercial split."
Notable are the unexpected trends in two key auction regions—West Midlands and Yorkshire and the Humber— both witnessing a decline in properties brought to auction and subsequently sold.
Sandeman concludes: "Monitoring these regions in early 2024 may unveil insights for those interested in these areas, providing a valuable perspective for strategic decision-making."
