More repossessions go under the hammer
Residential auctioneer, Allsop, has reported a rise in the number of repossessed properties being sold at auction.
In its February catalogue, Allsop has listed 410 lots, nearly 40% of which are being sold by banks or mortgage companies.
Gary Murphy, a partner at the firm, says: “We haven’t seen conditions like this since the early 1990s. At the same sale last year, less than 20% of residential properties offered were repossessions.”
He adds that a large proportion of the lots on offer are repossessed buy-to-let properties, commenting: “The buy-to-let market has attracted a whole new group of investors in the past 10 years, but many of them have not fully appreciated the pitfalls of property investment.”
Andrews & Robertson, another leading property auctioneer, has also reported a rise in repossessions.
Meanwhile, Neil Woodford fund manager at investment house, Invesco Perpetual, is predicting that UK house prices will fall by up to 10% this year.
He argues that property prices are simply too high and that the average home will drop £18,500 by the end of 2008.
If the predictions are correct, some regions and sectors of the property market could see price falls well above 10% and Mr Woodford suggests that owners of new-build flats aimed at buy-to-let investors will suffer most, describing the properties as “almost unsellable”.
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