The value of properties sold at auctions jumped 33 percent to $223.9 million this year, driven by more big ticket sales and soaring property prices.
According to Colliers International, the residential sector accounted for 51.3 percent of the total value of properties sold at auctions this year. Majority of sellers were owners themselves as the value of mortgagee sales dropped.
The $114.8 million worth of properties sold at auctions this year reflect a 30 percent increase from 2009. Only 12 landed homes accounted for 70 percent or $79 million of this number.
In the non-landed residential sector, 24 properties were transacted at auctions for $35.88 million, of which nine were located in prime districts.
While the value of properties snapped up at auctions climbed 33 percent, the number of properties transacted declined almost 40 percent to 71 this year. The $223.9 million auction sales in 2010 were 45 percent lower than the $407.4 million in 2007.
While the value of properties sold at auctions arising from owner sales surged to $178.6 million in 2010 from $90.8 million last year, the value of mortgagee sale properties sold at auctions dropped to $45.3 million from $77.6 million, said Colliers.
The number of properties offered for auction by mortgagees slipped from 195 last year to 103 this year, the lowest level in 13 years. Properties put up for auction by owners also dropped from 732 in 2009 to 688 this year.
While auctions were gaining more popularity among owners looking to sell, mortgagee sales had lost share as the strong economy meant fewer non-performing loans, said Mary Sai, executive director of Knight Frank.
“Also, the appreciation in real estate values reduces the risk of borrowers defaulting on loans,” she said.
Grace Ng, deputy managing director of Colliers, said the profile of buyers has shifted from a crowd looking for distressed assets to one that sees auctions as a way to buy prime assets.
“Increasingly, we see permanent residents and foreign bidders from neighbouring countries – including Malaysia, Indonesia, Hong Kong, India and even China – attending auctions,” added Ms. Ng.