Auction Finance

Auction watch: January 2021

Picture of a t with a blue dot next to it, in front of a purple background.

January is traditionally a month of two halves in the property auction world, with a quiet first half giving way to a very busy second half.

That’s never been truer than in 2021, when a flurry of auctions followed just a handful in the first half of the month. With the end of the Stamp Duty holiday looming on 31 March, auctions’ shorter completion deadlines offer both vendors and buyers reassurance that the transactions will definitely happen before the deadline, should any rumoured extension not materialise.

Here are a few of the lots that caught our eye this month:

The bidding war
The Stannary, Ludgvan, nr. Penzance, Cornwall

This once-grand, 1920s-built family home could be a true escape from the rat race, being just over 10 miles from Land’s End.

But that fate seems unlikely, because it’s currently in a very sorry state; a large hole in the roof is letting in the worst that nature can throw at it, which was reflected in the guide price of £195,000. Similar four-bedroomed properties in the area typically command double that figure, so any potential buyer would need deep pockets to bring it up to standard.

So why, then, did it attract 17 different bidders and sell for an astronomical £450,250?

We think the generous half-acre plot is where its appeal lies, with development of several new homes possible after The Stannary’s demolition. The catch? Ludgvan is a former tin-mining community, so you’d need a comprehensive survey before any new foundations can be dug.

The conversion opportunity
Atherton Centre & Library, York Street, Atherton

This former municipal building has lots of period charm, plenty of square footage and space to extend – so it’s easy to see why over 200 bids were made for this development opportunity in Greater Manchester.

It’s been empty for several years and has fallen into disrepair, but there’s lots you could do with it (subject to obtaining the appropriate permissions); we think it’s likely to be converted into several flats.

The work will cost a pretty penny, but that didn’t put bidders off. The guide price of £100,000 was a dim and distant memory by the time the virtual hammer came down – at a cool £369,000.

The multitude of options
42 Oak Tree Lane, Selly Oak, Birmingham

Selly Oak is a popular and buzzing suburb, home to the University of Birmingham and the city’s main Queen Elizabeth II hospital.

This three-storey, 9-bed former HMO now needs a significant update to bring it up to the latest licensing requirements. The student market is understandably slow at the moment, but this could (with some imagination, reconfiguration and modernisation) also make a great home for a multi-generational family. Or, alternatively, a welcome retreat for hospital staff in need of somewhere relaxing after another punishing shift.

The owner is in administration, and the administrator has been attempting to sell this property for some time; in fact, it failed to sell when it last went to auction in December, so the guide price was dropped by £60,000.

But that wasn’t enough to generate any interest, and the lot went unsold.

The (almost) ready investment
51 Whetstone Hill Lane, Oldham, Greater Manchester

The former mill towns around Manchester provide ample opportunity for the budding landlord to dip their toe into property investment without stumping up eye-watering amounts of cash.

This two-bed semi, which sits close to local schools and had a guide price of £50,000, is the perfect example; having been recently upgraded with a new bathroom and central heating system, it now needs a few finishing touches before letting – with two-bed properties in Oldham commanding rents upwards of £500/month.

Canny investors spotted that the maths on this lot more than added up, so it went for over its guide price at £80,000.

The too-good-to-be-true guide price
507 Cwmbach Road, Waunarlwydd, Swansea

When browsing the listings before this month’s auctions, this one jumped out at us – a three-bedroomed property guided at just £10,000? We knew immediately we’d have to read more about it.

And the results prove why it’s worth doing your research; a few minutes on Google is often all it takes. When browsing the property’s history on Zoopla, we spotted it had previously been offered at auction last summer at a guide price of £75,000 – and clearly, it didn’t sell. Needing a little modernisation but nothing onerous, we asked ourselves why it was at auction at all.

So we went inspecting the photos, where we found a clue: feint vertical lines visible beneath the upper windows – a sure sign of steel-frame construction. And so it proved. Nonstandardhouse.com maintains a register of all known properties built by the British Iron & Steel Federation (BISF) in the UK – and Cwmbach Road is on it.

This non-standard construction means securing finance through some lenders can prove difficult, although this is something we at Together would consider.

The ploy worked, and interest was plentiful – the hammer eventually came down at £89,000.

The blank canvas
24 Cavendish Road, Blackpool, Lancashire

This property is one with a tale to tell, with a quick Google revealing it was badly damaged by fire back in 2012. Eight years on it’s still in shell condition, but the hardest parts of the job have already been done: it’s been completed gutted back to bare brick, and there’s a new roof with dormer in place.

The listing states that it was intended to be an HMO, but the way it’s worded hints the vendor has been unable to see these plans through to completion. Still, with first-fix electrics having been done, the property is clearly water-tight and ready for further works.

It’s probably too large for a single family home, so may make more sense as a number of flats – although the buyer has the luxury of choice in this case. It’s worth noting that the local authority has deleted the property from its Council Tax listings, so it’ll be treated as a new property when works are completed.

That will be a while away yet, though – no bids were made.

The chocolate-box cottage
Thurlyans, Cherington, Warwickshire

This 16th-century, Grade II-listed cottage needs some love to convert it into the stunning family home it should be.

It was being sold by Warwickshire County Council, and for the last 90-or-so years it’s been a smallholding – the county maintains an estate of smallholdings that it provides to tenants, as a stepping stone to becoming established in the farming sector. Councils and other public bodies will often sell property via auction, as a quick sale is assured.

Why exactly they’ve decided to sell is anyone’s guess – it may be that there’s a lack of demand from potential tenants, or the council needs to raise funds. But there’s a chance it could be down to the latest rules about energy efficiency. The property has an EPC rating of ‘F’, which means it’s can’t be let to tenants in its current condition unless an exemption can be obtained (which, admittedly, seems likely given its listed status).

Whatever the reason, this picture-perfect pile caught the attention of bidders and sold for £471,000.

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