The auction market of late has been vibrant to say the least. The last 18 months have been a real rollercoaster. In this update I will give my thoughts on the temperature of the market. Much of what I will be discussing is based on our own observations, plus conversations with auctioneers and ancillary auction service providers.
The last quarter has a pretty tale to tell. Let us start with the juiciest part; the sale percentages at auctions in May (77.3%), June (77%) and July (73.6%) were all below 80%. Why is that important I hear you say. Well, since the first lockdown (a not too arbitrary date to choose), the average sales success rate year-on-year has been in excess of 80%. Where there had been the odd month or two (usually in January and August) where the sales percentage dropped below 80%, there has yet to be four (including August) consecutive months where the sales percentage fell and stayed below 80%.
Normally, we do not take the auction results for January and August too seriously (historically). Even with the vast majority of auctions either being online or online-hybrid, with several of the largest auctioneers now including into their auction calendar January or August auction dates, it makes sense to take those months and their results a little more seriously. We tend to see the best months for selling at auction being either in February or September, which are the two months following the two poorest months, for results at least.
The summer months tend to produce good results equally for sellers and for buyers, at least insofar as everything looks better when the sun is shining. Winter was a good time to buy, with October, December and February being the better months to purchase.
Below is a short note on the last five months with focus on the asset class and regional success/ failures.
May: May was a good month for prices achieved, but not the number of lots sold. It was a month where commercial/mixed-use assets beat down the residential market. Not in the amount raised, but certainly in the number sold.
Commercial assets seemed to have increased in popularity and by May the results of this increased heat were being seen.
