More Estate Agents Turning to Auction Sales
Estate agents are increasingly turning towards auctions to sell properties, according to a leading member of Network Auctions. He backs this up by insisting that his company had enjoyed a ‘record year’ in 2016 with more than £42 million raised, and a success rate of 85 per cent.
Speaking at their Partners Conference in the Grosvenor Hotel, London earlier this month, director Toby Limbrick said sales had come through their physical sites in London and Birmingham. But he was even more hopeful that their new online sales channel, named Network E, would prove equally as profitable.
“Our partner network has significantly grown as more estate agents have learned about the benefits of working with the network to sell through auction,” he said.
Estate agent Perry Power, who is a member of Network Auctions enthused says he has enjoyed growth of more than 80 per cent year-on-year in his first three years since joining the company. Today he boasts a team of 13 agents.
Property auction market finished strong in 2016
December 2016 saw a record number of properties at auction, according to new statistics from Essential Information Group (EIG). A total of 3,745 lots resulted in a 12 per cent increase year on year and is the largest number ever for December since auction records began. It also led to a record £537m being raised for December – the highest monthly figure for the whole of 2016.
“Having reported on a challenging few months towards the latter part of last year, it’s pleasing to see an extremely positive end to proceedings and set new records in the process,” said property auction expert and founder of EIG, David Sandeman.
Breaking those figures down further, residential property increased 12 per cent while commercial property went up 15 per cent.
Selling leasehold properties at auction
Speaking at the recent London conference Guy Harrison, an auctioneer, director at Network Auctions and a regular TV pundit, insisted that selling leasehold properties at auction could result in a very handsome commission for agents.
This is when a property is sold with a sitting tenant. He or she maintains the house and insures it, without paying any rent. It’s only when the tenant dies that the building becomes the property of the investor. By which time, however, it should have amassed quite a bit of capital.
The older the occupants of the leasehold property, the more of a discount at auction, with some leasehold properties fetching a discount of up to 60 per cent
Harrison’s company Wakeley Residential Investments deals with around 250 lifetime tenancy leases a year and which he then sells on to property investors. He considers the buying of a leasehold property at auction a good ten to 20 years investment.
He said: “We are interested in opening up this market to private investors. Many are investing on behalf of children or grandchildren, looking to give them a foothold on the housing ladder further down the line.”
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