Great Auction Sites
Recent predictions by two leading housing reports says that house prices are heading for a 25% fall into 2009 before they start to recover taking them back to 2004 prices.
However, it is now possible for landlords to buy property in some parts of the country approaching their 2004 prices, particularly where property investors can find distressed sellers. One of the most obvious places to access distressed sellers is at property auctions.
Report on distressed sellers at auction
A recent report by the auction website EIG & Allsop the leading auction house, in their RAPID (Residential Auction Property Investment Data) highlights just what is happening in the distressed seller market. The low point was recorded in the first qtr of 2005 of 245 distressed sales at auction. This rose to 1513 in Q2 08. An indicator of the proportion of these that were likely to be distressed sales from novice landlords was that 38% of these distressed sales were apartments.
There has been a consistant rise in distressed sellers from about 5% of total auction sales in Q1 of 2005 to over 20% in Q2 of 2008. The rate of increase varies across the country, with one of the highest found in the North West whilst London has the lowest.
This glut of distressed sellers defined as: repossessions, liquidations and administrations is an indicator or economic hard times but also of the opportunities present in the current market for liquid property investors.
We have looked before at the opportunities available at auction to snap up a bargain.
Reserves too high but yields are rising
The research concludes in the RAPID report that sellers are still setting reserves too high, resulting in a high proportion of lots remaining unsold in this cautious market. However, property investors should note that yields are rising, with gross yields rising rapidly towards 10% for properties in the North East and Wales with figures of 9.2% and 8.7% respectively. This will attract Hawkeye’s interest as Mr 10% starts to see the return of his favourite number.
Our advice is to read up on how to go about buying at auction before taking the plunge.
Here are some other useful sites we have found to help landlords bag an auction bargain.
Find 1000s of auction properties for sale in your area with Auction Properties for Sale.
Check out what properties sold for so that you don’t over pay.With house prices still heading down look at price levels in 2004 to see what you should really be paying houseprices.co.uk
The site Property Auctions provides a list of forthcoming property auctions across the UK
The Royal Institute of Chartered Surveyors (RICS) provides a very useful FREE guide to property auctions.
If you are buying in an area that you don’t know, then Up My Street’s ACORN classification gives a perceptive in sight into what type of people live in the area. Do they sound like your type of tenants?
For landlords looking at picking up a cheap property portfolio then, have a look at Landlord Traders investment property.
The Rolls Royce of auction property websites has to be EIGs all singing and dancing website. The good bits are only available to subscribers but if you are a landlord serious about buying at auction it’s worth subscribing. The site allows landlords to search through all up and coming auctions and also a whole range of historic information to give them a unique insight into the market. They have recently introduced a repossessions search section allowing landlords to specifically search for distressed sales.