Repossessions prompt house auctions boom
The second quarter saw a 32% increase in the number of residential properties offered at auction, new research from the Royal Institution of Chartered Surveyors has shown.
Repossessions were the main contributor to the rise as higher interest rates prompt a deterioration in affordability conditions.
The Bank of England has increased borrowing costs five times since August last year in an effort to cool inflation and the UK housing market.
Some 5,120 residential properties were sold at auction in the second quarter, the most in two years and up 22% on the previous quarter.
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The North West of England witnessed the largest increase in auction activity and the biggest quarterly pick up in repossession orders anywhere in the UK.
RICS reckons residential lots offered at auction should continue to pick up, with repossessions predicted to top 45,000 in 2008.
"With the full impact of interest rate rises in 2007 yet to filter through into higher mortgage costs we continue to expect a rise in the number of homes going under the hammer into 2008," SAID RICS economist, Oliver Gilmartin.
