_The outlook for auctions in 2023: predictions from Knight Frank Auctions

There’s no denying the current mood of most property markets centre around the current financial unpredictability and yet across the auction business, there are signs of renewed vigour.  

Yes, interest rates have risen significantly this year, taking mortgage rates with them and yes, general price inflation and the squeeze on the cost of living means that everyone is being much more thoughtful about large purchases. Across my team however, we have seen sellers who we first spoke to around nine months ago, returning to re-engage us in order to sell their property at auction.

In the intervening period, they attempted to sell their property through private treaty but when this didn’t work, perhaps because sales repeatedly fell through, offers were rescinded or chains collapsed, they saw an auction sale as a way of getting a rapid and certain result.

Selling at auction means that the time between deciding to market the property and completing the sale is very limited. Typically, we price on Day 1 and sell on Day 30. In an uncertain market, this provides both sellers and buyers with greater certainty at what they can expect to achieve.

Speed and certainty are the two key reasons why people choose to buy or sell at auction. They have a known deadline and often, although clients do not necessarily need a quick sale, speeding up the process has a clear benefit for them.

Most auctions are conducted under unconditional contracts, a traditional process that is legally binding and generally offers twenty days for the purchaser to complete. Typically, contracts are exchanged on the day of the auction with completion following four weeks later. It’s a clean and transparent process.

In addition, more sellers are approaching us to sell high value properties on an individual basis. We launch these properties and close them on their own specified date, rather than including them as part of a bigger sale.

This provides all the benefits of an auction along with with greater flexibility for sellers and, of course, greater individual exposure for their property. In general, we choose this method for properties that in some way stand out or have a unique feature, ones that have a less easily definable or more specific buyer profile perhaps.

An example that has just come to market this week is a handsome 4 bedroom house over five floors in Marylebone (pictured above), one of London’s popular and prime neighbourhoods. The Grade II-listed mid-terrace property, currently let, is for sale freehold with a guide price of £2,300,000.”

Knight Frank’s final auction of 2022 will be held on Thursday 15th December.

For further details, or to learn more about how Knight Frank Auctions can help you, please contact Richard Watson on Richard.Watson@knightfrank.com | 020 7861 5141