The UK’s leading property auctioneer is issuing a cautionary message regarding the prudent pricing of properties entering the market during the latter half of 2023. This advisory holds particular significance for buy-to-let landlords considering auction sales, especially those facing financial challenges due to the prevailing high interest rates impacting their rental investments.
According to Jeremy Prior, the managing director of Auction House, it is crucial to have two essential factors on your side when selling property in the current market conditions. First, professional advice tailored to the specific location where the property is being sold, as there is no universal guidance that applies everywhere. Second, pragmatic pricing is key. Local auction experts determine guide prices that accurately reflect realistic figures for the property being sold while also maximizing interest from potential bidders. This approach aims to attract the highest number of interested buyers in the current challenging market.
This is not about adopting a negative or pessimistic outlook. The competitive nature of the bidding process implies that once potential buyers are involved, they tend to be hesitant about withdrawing their interest, ultimately leading to higher sale prices. However, it is crucial to guide each property at a price point that generates initial levels of interest.”
Prior has shared positive news amidst the prevailing economic uncertainty, highlighting that Auction House achieved a record-breaking second quarter in 2023. Comparing the figures to the previous year, Q2 sales have increased from 988 to 1,225, and the total amount of money raised has risen from £155,322,545 to £171,864,939.
What is noteworthy about these statistics is the continued increase in our sales despite the growing challenges in the property market. As auctioneers, we are faced with a challenging combination of rising interest rates, declining confidence, and political uncertainties both domestically and internationally. However, the fundamental belief in real estate as a secure long-term investment remains strong, and there are excellent opportunities available for savvy investors,” suggests Prior.
He concludes, “Auctions often act as an early indicator of market trends, whether it’s an upturn or downturn. The issue with private treaty sales currently is that estate agents and sellers often cling to unrealistic high prices for extended periods, and then wonder why their properties are not selling. Disheartened clients frequently approach us from estate agents, expressing frustration about deals falling through or enduring months of waiting to sell. The advantage of the auction process is that it allows the market to determine the property’s correct value, often resulting in a sale within weeks.
“In a demanding property market like the current one, remarkable opportunities for astute buyers arise, especially for those with a medium to long-term perspective. However, when it comes to achieving successful sales, it has never been more crucial to seek expert guidance and ensure accurate pricing.”
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