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Auction roundup – the rise in MMoA and a bumper bungalow boom

This week’s roundup is centred around demand, with iamsold reporting a strong rise in Modern Method of Auction as market conditions called for more property auctions. Meanwhile, Network Auctions announces its new ground rent division for landlords, SDL Property Auctions is featuring a wide range of bungalows in its upcoming sale and Sutton Kersh reports a strong start to 2022.

Was 2021 the peak year for auction demand?

Last year was certainly a transformative year for the property market, with the increased popularity of the Modern Method of Auction (MMoA) cementing the fact that auctions have a key role to play in all markets, according to iamsold.


But was it just market conditions driving demand for auction?

iamsold, the auction service of iamproperty, reported record-breaking results for 2021 – with both the capital value raised and the number of consumers interacting with the service via online views and bids right across the UK.

In 2020 bids across the year for iamsold auction properties totalled 28,044, in 2021 bids hit a record high of 55,434 and with January 2022 recording 4,881 bids in one-month alone consumer interaction shows no sign of slowing down.

Couple that with Google Trend data which indicates that online search interest in ‘Modern Method of Auction’ has been steadily on the rise for the last three years, with a rise of 130% in consumer search when comparing January 2019 to January 2022, the auctioneer says consumers’ awareness, consideration, and use of auction as a method of sale continues to grow.  

Jamie Cooke, managing director of iamsold, comments: “Whilst we acknowledge that it was a year of unique circumstances with unprecedented demand and low stock levels, it’s been hugely pleasing to see so many Estate Agents turn to auction to meet the changing needs and demands of their clients and to support their own business over the last 18 months.”

According to Cooke, today’s buyers and sellers want more, and being offered a choice that matches their individual circumstances is just part of that. Meanwhile, consumers and agents want speed and security and with Private Treaty completion timescales averaging 120 days, auction ‘should be a big part of the solution’ for the property market.

He adds: “We sold over 5,000 properties last year with the average selling price increasing by 19% in 2021, when compared with 2020 averages, proving real versatility in the types of properties available at auction. This is helping the positive narrative around auction continue to shift with both estate agents and consumers.”

“It offers a real benefit to so many buyers and sellers and with the property market starting 2022 with record-breaking transaction numbers, we hope to see this exploration of auction as an alternative Method of Sale continue to rise over the year, with more demand driving auction success across the industry.”

iamsold’s January property sales totalled over £70 million, representing a 16.6% increase on the same period in January 2021 which totalled £60.3 million. This figure sits alongside news that January 2022 was the strongest start to the year for property since 2005.

Ground rents – the easiest property investment you’ll ever make (maybe)

Network Auctions has declared that ground rents are a lucrative and low hassle way to be a landlord and make money, ahead of its inaugural Ground Rent auction taking place this month.

“It’s a niche sector, but it’s highly regarded by those who understand it, and once people understand it, they can’t believe they’ve never done it before,’ Toby Limbrick, auctioneer and director of Ground Rent Auctions, says.

‘We’ve been thinking about setting up a specialised Ground Rent auction service for a while, and given the success of being online since the pandemic, we decided now was the right time to launch.’

Ground Rent Auctions, the new specialist division from Network Auctions, will host its first online auction on February 24  2022.

In England and Wales, there are two forms of property ownership: freehold and leasehold. Leasehold properties are governed by the regulations in the lease, which are owned by the freeholder. The freeholder may not own the building, but they own the land on which the building is sited, and in many cases, collect a ground rent annually for the right of the building to be on their land.

“The value and the opportunity are in the Freehold rights to the land,” Limbrick adds. “And what many people forget when they’re buying leasehold, is that mortgage lenders require you to have 80-plus years left on a lease, else you’ll have to pay ‘marriage value’ to the freeholder.”

Marriage value is the fee payable to the freeholder when the lease is extended, this fee is enshrined in law at 50% of the value of the uplift.

Limbrick continues: “Ground rents are a niche sector and it requires expertise to fully understand the opportunities, but they are attractive, fixed-income investments secured by a lease.”

“There are many ways to unlock the value of a lease including varying terms (where a premium will likely become payable). This is particularly relevant to leasehold houses where extensions and loft conversions may require a Deed of Variation. There are also income opportunities when it comes to management and insurance arrangements.”

Limbrick says there are an increasing number of freeholders maximising their investments by carrying out building improvements, refurbishments or extensions.

“With some freehold, there may be potential to develop grounds with additional dwellings, garages and parking bays, while changes to the planning environment have seen additional floors being added to existing blocks,” he adds.

“We have a number of exciting opportunities across the country in our first auction on 24th February with guides as low as £4,500. There are lots with potential to develop by adding additional storeys and others where amenity land could be used for future development.”

“For those who prefer the quieter life, we have plenty of Ground Rents which can offer a solid and steady return and are a great opportunity for investors to diversify their property investments.”

“We really believe when people understand the wonders of Ground Rents, they’ll be kicking themselves why they didn’t invest before,” he concludes.

Ground Rent Auctions will host its first online auction on February 24 2022. For more information visit: https://groundrentauctions.co.uk/

SDL Property Auctions expects high demand for bungalows in 2022

SDL Property Auctions has announced a good selection of bungalows in its second auction catalogue of the year, released ahead of its live-streamed National Property Auction on Thursday February 24.

A highlight for investors is the chance to get stuck into a refurbishment project in Shropshire, where 14 St James Drive in Bridgnorth is being sold in partnership with Nock Deighton with an attractive guide price of £110,000-plus. The two bedroomed semi-detached bungalow in a quiet cul-de-sac within walking distance of Low Town amenities has recently experienced structural movement and requires full renovation. 

Andrew Parker, managing director and auctioneer, says bungalows are always extremely popular as they provide so much potential, which makes them appeal to a variety of buyers.

“Private homeowners may be looking for one-level living for themselves, while wise landlords are keen to cater for our ageing population and the growing number of people renting into retirement,” he comments. “Meanwhile, because many bungalows are built on large plots, this provides opportunities for redevelopment, with the necessary permissions, of course.”

Among the properties offering development potential, subject to planning permission, is a unique extended two bedroomed detached bungalow in East London. 

Sitting on a larger-than-average plot, 10 Roding Lane North in Woodford Green lends itself to being extended or developed or could simply be modernised to create an attractive home. It features a dining kitchen, reception room, two double bedrooms, bathroom, separate shower room and an attached garage. It is offered for sale in partnership with Bairstow Eves and has a guide price of £550,000-plus. 

Another opportunity can be found in Birmingham, with convenient access to Birmingham Airport, the NEC and motorway network making it a particularly attractive investment. 

Set back from the road at the end of a driveway with space for several vehicles, 161 Elmdon Lane in Marston Green, which has a guide price of £300,000-plus, comprises a lounge diner, kitchen, utility, conservatory, two bedrooms and a bathroom. A covered passage at the side provides access to an extensive rear garden.

Similar opportunities are scattered around the country. In Nottingham, 1 Field Lane in Beeston is on a substantial plot with gardens front and rear offering the opportunity to extend or develop, subject to planning permission. It currently features an entrance hall, kitchen, two reception rooms plus lean-two conservatory, kitchen, three bedrooms, bathroom with separate toilet and an attached single garage. Its guide price is £235,000-plus.

Meanwhile, in Manchester, a spacious detached bungalow in Crumpsall has been well maintained over the years but requires some modernisation. Offered for sale in partnership with Aubrey Lee, 4 Wilton Road has two bedrooms plus a study/third bedroom, two reception rooms, kitchen, bathroom with separate WC and a detached garage. It has a guide price of £325,000-plus.

Parker continues: “Crumpsall is an up and coming area which is really popular with landlords due to its proximity to North Manchester General Hospital. If this is purchased for the rental market, the landlord will never be short of tenants.”

These are just a few of the bungalows being sold in the National Property Auction and a mere fraction of SDL Property Auctions’ February offering which also includes houses, flats, HMOs, commercial properties and land, with lots to suit every requirement and budget.

The National Property Auction on Thursday February 24 will be live-streamed via the SDL Property Auctions website with bids placed online, on the phone and by proxy. To register to bid click here.

Sutton Kersh holds first successful auction of 2022

Sutton Kersh sold over £10.4 million worth of property at its first auction of the year.

The team saw over 700 bidders registered for the event from across the country. It sold just over £3.1 million worth of property prior to the auction and a further £7.3 million on the day.

The first lot of the day was a four-bed detached home in the popular residential area of Southport. This listing was a rare opportunity due to the highly popular coastal location, to develop the perfect family home. After a strong bidding war, the lot sold for £104,000 above the guide price.

Lot 2, another residential property in need of refurbishment, had a guide of £75,000 and sold for £119,000. Meanwhile, lot 6, a three-bed mid-terrace in the L4 area of Liverpool by Stanley Park, had a guide of £70,000 and has a potential rental income of £7,800 a year. It sold for £101,000 which is close to what an estate agent on the open market would sell this for.

This trend continued throughout the sale with residential and terraced properties in need of modernisation and refurbishment selling for over their guide prices.

‘Birch House’ is a stunning four-bed detached house in Lower Withington, Cheshire set within two acres of land. It was listed with a guide of £450,000 and in need of refurbishment and modernisation. Nonetheless, the property attracted bidders from across the country and after another bidding war, it sold for £683,000 – a whopping £233,000 above guide.

Auction roundup – the rise in MMoA and a bumper bungalow boomCathy Holt, associate director of Sutton Kersh Auctions, comments: “The demand for properties was as strong as it was last year, especially for residential and investment properties. We are delighted with how well today went, selling 80 properties which is over 80% of lots available.”

A lot of homes are coming to market that need refurbishment or modernisation, so much so that over 50 lots were residential investment opportunities. The demand for these types of property is still so high as, for many, it is more cost-effective than buying a house that is move-in-ready.


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