Figures released by an auction research group have revealed that properties sold via auction usually sell for 15 per cent less than properties marketed via estate agents.
To illustrate this trend, there were 2,712 residential properties offered for sale via auction in December 2014, of which 2008 were sold. The average sale price was £154,014. By comparison, the average sale price for a residential property not sold via auction during the same period was £177,766.
Record Year for Auction Sales
“In the residential sector, the gavel fell on 21,834 lots during 2014 – a 2.1% increase on 2013. More significantly, this sets a new record for the highest number of residential sales in a calendar year, surpassing the previous high recorded in 2007,” said David Sandeman, managing director of auction research firm, El Group.
“We have also seen the amount raised at residential auctions increase throughout the year, often in double-digit percentage terms, and the yearly figures below show the total has broken through the £3 billion mark for the first time in seven years – a fantastic achievement for the industry.”
Auctions not for the Faint Hearted
Buying properties at auction can be a smart move for property investors, but bidding at an auction is not for the faint hearted. For one thing, you need to have your finance sorted out before the auction as once the gavel falls you have a limited time to complete the sale. For another, you won’t be able to back out of the sale if you subsequently discover that the property has some catastrophic or expensive fault, so surveys, etc., need to be sorted out before the auction begins, which is money spent with no guarantee you will even be the winning bidder.
