Only 57 per cent of properties put up for auction in Q4 2007 were sold, as buyers retreated from auction houses due to tighter lending conditions and house price uncertainty.
This compared to 69 per cent a year ago. Overall, according to RICS, 3,310 properties were left unsold at auction in the final three months of 2007.
Despite this fall, the number of properties offered in the first instance was still high at 7,732 – a rise of 15 per cent on Q4 2006 – while the number of repossessed properties rose by around 20 per cent.
With repossessions set to rise in 2008, it is claimed that more properties will end up being sold via auction houses.
RICS economist, Oliver Gilmartin, said: “Fears over further house price falls have taken some stimulus out of achieved sales at the auction house as specialist lending has all but evaporated.
"While lots offered at auction have stabilised, we expect a tougher year for many at the margins in 2008 as mortgage providers become more selective.
“While tightening credit conditions will be most acute for those with a poor credit histories, less generous loan amounts and the introduction of some upper limits on loan advances could equally hit the mid-tier of the market, increasing the number of properties languishing on auction books.”
David Sandeman, managing director of Essential Information Group, said: “This has hit auction houses across the UK, as in the last three years people have been clambering to buy anything.
"There is a lot more transparency now as, post-credit crunch, vendors are putting a realistic figure on property and percentage sold rates are coming back.”
