If you are considering selling your property in an auction, right now is probably one of the best times in the last few years…probably even better than February 2020 after the post-general election auctions occurred.
A director of one of the top three auction houses posted an article saying that they’d had the best auction since 2017. That’s not entirely accurate because they had a better auction in February 2020 and, arguably, also in February and March 2018. However, the vibe in auction rooms fully supports these recent headlines. Many are selling. Everyone appears to have embraced the online auction model to the extent that people would definitely miss it if ballroom auctions return without all of the online features supported.
If you are looking to buy in auctions, you will be facing competition from a lot of buyers who seem to want to spend their cash asap. We run an Auction Buyers Club –
a group of 12 people with in excess of £150,000 available – who are actively looking to buy and we struggle to find opportunities. The only opportunities out there at present are those where you need to be extremely creative with how you are going to add value to the property. This is the real currency right now, the one which will allow you to get profitable deals. The more creative you get, the less money you might have to pay compared to the Gross Development Value (GDV) you can then create.
As such, currently auctions are a great place for sellers. I don’t know how long this is going to last as the economic pressures on many businesses and lack of protection from evictions for commercial tenants returning soon might translate into increased stock levels. This is likely to affect the prices being achieved.
Below, are some examples.
One of the most interesting lots we noted was a freehold property at 877 High Road, Leytonstone. This property was offered on behalf of receivers. Unfortunately for the previous owners and others in distressed sale situations, this is very much a growing trend. The property was split into a restaurant/pizzeria on the ground floor and basement, three flats above and an advertising hoarding on the side. Total income generated from this property was £67,000 per annum. The guide price was £700,000+.