Sutton Kersh auction raises £2.5m

Sutton Kersh raised £2.5m after 65% of the 53 lots available sold at its last property auction in Liverpool city centre.

Prior to the auction, which was held at the Marriott Hotel in Queen Square at the end of last month, Sutton Kersh said 30% of the catalogue was sold before the event.

Amongst those that sold were two residential properties including a double fronted detached property at 24 Fairfield Crescent in Fairfield being sold for £150,000 and an eight bedroom three storey semi-detached property, located at 29 Crosby Road South, selling for £100,000. Both properties were in need of repair.

However, the most expensive by guide price of £1.5m-£2m, 24 Hardman Street in the city centre did not sell. The property was the former home of the Picket live music venue and was available as part of a 33,500 sq ft site comprising a terrace of Grade II-listed Georgian buildings, previously occupied by the Liverpool School for the Blind, the Merseyside Trade Union Community and Unemployed Resource Centre.

Sutton Kersh said the low activity at the auction could have links to the proposed rise in capital gains tax when the Chancellor is expected to announce a 22% rise in capital gains tax at the emergency budget on 22 June, which will see it return to 40% from its current level of 18%.

Capital gains tax is a tax charged on capital gains, the profit realised on the sale of an asset, which can include property, which was purchased at a lower price.

Sutton Kersh added that, if a rise is phased in, this could lead to big increases in stock levels as investors look to offload their portfolios to maximise their returns and beat the tax rise. However, if introduced immediately, Sutton Kersh said it may cause the market to saturate with investors deciding to hold on to their properties in hope of a policy change over the next couple of years.

James Kersh, director at Sutton Kersh, said: "All will become clearer after the emergency budget is announced. This may have a big impact or it may have little to no impact depending on the terms of the policy. The recovery of the housing market will play a crucial role in the recovery of the UK economy and I would hope that the Government will be looking to stimulate activity rather than hinder it.

"We are currently accepting instructions for our next auction on the 15 July. Whilst we have received a few enquiries from investors as a result of the captial gains tax speculation, we aren't noticing a significant impact on the market. The improving private treaty market has caused stock levels to fall at auction. Whilst the availability of finance is slowly improving, more relaxed lending is needed to stimulate improvements in the broader housing market."