The UK’s residential auction market closed 2024 with a rise in sales of unmodernised properties, accounting for almost 30% of auction sales in 2024 and representing the highest level in five years.

According to the latest report from Essential Information Group (EIG), terraced and semi-detached houses have led the way in the rise of unmodernised lots, standing out as the most common types in this category.

Terraced homes, in particular, surged, with 932 sold in Q1 2024 alone. Semi-detached houses also saw strong demand, peaking at 498 in Q3 2024. Flats and apartments followed a similar upward trajectory, reflecting increasing refurbishment opportunities.

Although a large majority of these properties (97%) required aesthetic renovation rather than structural remediation, EIG’s report features interesting case studies that highlights the potential for achieving an uplift in onward sale prices, ranging from 40% to 70% of the auction sale price.

David Leary, Director of EIG, wrote: “Unmodernised homes have grown their market share significantly, reaching 29.9% in 2024 – the highest level in five years. With the Renters Reform Act set to take effect in 2025 and stricter EPC regulations making it harder to let energy-inefficient homes, many landlords may be opting to offload properties rather than invest in costly upgrades. This trend has led to a growing supply of refurbishment opportunities, with buyers stepping in to capitalise on value-add projects.”

Higher demand and rising property values

Overall, the auction market saw impressive growth last year, with increases in lots sold, total funds raised, and average sale prices.

The number of lots sold rose from 25,375 in 2023 to 28,063 in 2024, marking a 10.6% increase., while total funds raised also saw substantial gains, increasing from £4.83 billion in 2023 to £5.5 billion in 2024 – a 13.9% rise.

Average sale prices also climbed from £190,315 in 2023 to £195,969 in 2024.”

Average sale prices also climbed from £190,315 in 2023 to £195,969 in 2024, reflecting appreciation in property values and heightened competition among buyers.

Although the residential investment market, specifically, experienced price volatility, with an initial dip in Q1, it was followed by a recovery and subsequent stabilisation. Yields remained strong too, peaking at 8.85% early in the year and holding firm above 8%, indicating that investors continued to pursue solid returns despite shifting property values.

David added: “As we move into 2025, the key drivers of auction activity – interest rates, rental market dynamics, and evolving legislation – will continue to shape investor behaviour. With buyers seeking value-add opportunities and sellers leveraging auctions for quick, efficient transactions, the sector remains well-positioned for another active year.”