In fact, the CML reported that mortgage lending hit a post-crisis peak in April, seeing the highest comparable monthly lending total since 2008. Proof that the great results enjoyed all round for March, as discussed in my previous blog, weren’t just about beating the buy-to-let changes.
Our experience at Together reflects this positive outlook for the market. Let’s take auction finance for example; our results for the period ending 31 March 2016 showed a huge increase of 40% on the previous year, with the value of auction loans provided for the 12 month period totalling in excess of £82 million.
Auction houses are no longer solely the preserve of property experts and landlords. Consumers are now savvy to the benefits that buying at auction can bring. Those benefits include securing your property on the day; once your bid has been accepted it’s legally binding and you’ll need to pay a 10 per cent deposit there and then, and often you can secure a property at a great price, since the seller is firmly committed to his part as long as the reserve price is met.
In the current climate, where in certain geographical pockets prospective homeowners are competing for the same properties and having to fight off stiff competition after heated open day viewing scenarios; with prices often shooting well above asking price, the auction house allows the purchaser the opportunity to do some research in advance, scope out the potential of the property, and assess both the guide price and reserve price to ensure that any offer is in line with market value.
The movement in the auction market, however, very much mirrors the wider property market trends, with key regions showing significant growth, whilst others are much steadier.
Figures from auction body the EI Group showed that 139 property auctions were held across the UK in April, with 2,462 lots going under the hammer. This was slightly less than the previous year, when viewed on a monthly basis, although the amount raised was comparable. However, the quarterly figures showed growth of 5 per cent in lots offered and lots sold, and a huge 23 per cent gain in the amount raised compared with the same period last year.
It’s no surprise that London saw the highest total value of property sold at auction; up 21 per cent on the previous year. The North West Home Counties performed the best regionally, with the strongest year-on-year growth at 51 per cent, followed closely by Yorkshire and the Humber region which saw a 50 per cent increase.
So whilst not all regions have seen quite such surges, it’s certainly fair to say that on the whole, the auction market is getting stronger and stronger and my own experience at auction houses across the UK bears that view out.
I’m at Cottons in Birmingham tomorrow and at Venmore Property Auction in Liverpool the first week in June, so if you’re in the area and you’re looking for some expert advice on financing your auction purchase, pop in. Remember, the auctions aren’t a closed club – anyone can come along; whether you’re looking for residential, commercial or semi-commercial property, you’ll find some great lots on offer.
