On Thursday 22nd February PropVestment attended the McHugh Auction at BAFTA in Piccadilly. Majority of the lots were residential properties in London. Therefore the results tell an interesting story about the property market activity in London, which is in contrast to other parts of the country.
The observations will be of interest to property buyers, sellers and first time buyers alike.
If we look at all 34 lots, the average highest bid price was £339k, at an average of 14% over the guide price. However with the highest bids, there were still around a third, so 10 properties where the reserve was not met.
Taking out the ones that did not sell, the average selling price was £260k, which was an average of 21% over the guide.
What this shows that the lower value properties or smaller properties sold much better and achieved a much higher price than anticipated shown by the higher percentage over guide.
This also showed that investors are wary of higher value properties and more importantly for these higher value lots sellers want a much higher price and will not settle for less.
For example many of the RNM lots were multiple deed lots, that compromised of HMOs or properties with numerous individual flats.
If we isolate the lots where the reserve was not met, the highest bid on average was marginally lower than the guide with an average highest bid £391k.
McHugh Auction Bargains
- Studio in Muswell Hill, sold for only £66k, short lease of 58 years but a rental yield at this price of 11%
- 3 Bed house on Finchley Road, NW2 sold for £320k
- 3 Bed House, with Annex with 1 Bed sold for £250k in Enfield. Potential to separate deeds and refinance
McHugh Auction Bank Busters
- Freehold lot with a commercial and 3 flats in Harringay, sold at £750k, 36% over guide
- 8 Bed HMO in Mornington Cresent, sold 25% over guide at £1.03m
- 2 Bed Maisonette in Oakwood as seen in our post a couple weeks ago. Short lease with renewal option, Sold 87% over guide at £187k. Lease extension will cost almost £40k.
London market activity is always an exception to rules, there was a greater activity but also positives and negatives seen. Some lots sold, some did not. All about right property, right location. Trend is for smaller properties to be more fluid and easier to buy and sell.
There may be some first time buyers looking for last minute deals on lower value lots before the stamp duty is re instated.
See our other recent article on Auctions: