AUCTIONnews uk property auctions analysis
Cash in the attic talks to
David Sandeman of EIG about the state of play in the auction house for the first half of 2010.
EVEN IN THE midst of what has been billed as the worst recession for decades, the auction room still attracts bidders who have, presumably, a cash stash in the attic. The banks certainly aren’t lending! Do they have much to choose from? And is anything up for auction actually selling? David Sandeman has consulted his
records and prepared a review for PROPERTYdrum of how the auction industry has fared over the past six months against the economic backdrop and the ending of continual property prices rises and confidence in 2007 and early 2008. The charts show how each of the first six
months of the year have compared with each other 2006 – 2010. The figures shown are for the combined residential and commercial sales.
Graph 1 LOTS OFFERED
5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0
2006 2007 2008 2009 2010
Jan Feb Mar Apr May Jun
Lots offered increased in May before dipping again in June Graph 3
Millions
£1,000 £900 £800 £700 £600 £500 £400 £300 £200 £100 £0
AMOUNT RAISED
2006 2007 2008 2009 2010
Jan Feb Mar Apr May Jun Revenues have been far less than 2006-7, but not on the floor 42 SEPTEMBER 2010 PROPERTYdrum
85% 80% 75% 70% 65% 60% 55% 50%
4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0
Lots sold
It comes as no surprise to see that each peak occurred in 2007 (except Jan), and that 2009 and 2010 had the lowest figures between them. The fall in ‘lots sold’, when comparing H1 2007 with H1 2010, was 30 per cent for residential and 34 per cent for commercial. This should be viewed against the 60+ per cent fall in the number of property transactions recorded at Land Registry in the same periods.
Amount raised
A similar story to ‘lots sold’ is seen, albeit with bigger differences between high and low values. This was due in part to the drop in number of commercial lots offered that have a higher average price than residential lots. There were also fewer larger residential lots being offered.
Graph 2 LOTS SOLD Per cent sold
As one would expect, 2006 and 2007 had some of the highest rates but perhaps surprisingly 2009 had high rates as well. 2008 carried the lowest sale rates as the market adjusted to changing sentiment, with 2010 being in the mid area and just below the long term average.
Conclusion
Whilst we have seen a decline across all the metrics for measuring activity in the auction market, the numbers do show that the decline has slowed down or arrested and in some cases reversed, and outperformed the wider residential market. Looking forward I believe that the auction market has adjusted itself to the new market conditions and will perform relatively well going forward.
2006 2007 2008 2009 2010
Jan
Feb
Mar
Apr May
Jun
Sales in June were better than January but still way below 2007 Graph 4
PER CENT SOLD
2006 2007 2008 2009 2010
Jan
Feb
Mar
Apr May
Jun Sales in 2010 have fluctuated more than any other year
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68