People are buying and selling more property at auction than ever before. KERRY ANN EUSTICE finds out what all the fuss is about.

The buzz of the auction room and the thrill of making the highest bid are proving too much for buyers to resist.

A new report has found the number of homes sold at auction has massively increased over the past 10 years.

Research from Essential Information, a UK auction information provider, says 21,000 homes go under the hammer every year - a 60 per cent rise on 1998's figure.

Clive Emson, director of Clive Emson Land and Property Auctioneers - mainly for lots located in Kent and south-east London - has seen its auctioning events get busier and busier.

Last year it sold 1,000 lots amounting to £105m worth of property and land and at the last auction in July £22m changed hands.

Mr Emson attributes the increase in popularity to market shifts and the loosening of financial constraints.

He said: "Auctions are a quick way to buy and sell and people who become frustrated with long chains and completions like the immediacy of it.

"The availability of bridging finance, where you can borrow to buy before you have sold another property, and second mortgages are freeing people up. Lending institutions have relaxed their borrowing criteria.

"There was a time when you could only have one mortgage per property but this has changed and opened up the buying route.

"This has brought more buy-to-let investors in too."

Mr Emson suggests in the past a lot of people have seen selling at auction as a last resort if they cannot get the price they want on the open market. But he insists this is not the case. Sellers can get higher than the asking price - especially if there are a few keen bidders competing for the same lot.

"An auction doesn't suit every buyer," adds Mr Emson. "It's usually best for those who want to add value through refurbishment and modernisation, who don't just want a property to live in."

That said, the company has seen more owner occupier sales. Clive has found these are often first-time buyers, dodging a chain, as in the ordinary market this group is waiting on others to complete.

From a selling point of view an auction can also have keen advantages in a tight market.

Mr Emson said: "If supply is outstripped by demand you may get 10 buyers all interested in the same house. This means it will go for the highest possible bid, everyone knows what the other is offering so will not offer over the odds and the highest bidder gets the deal."

Also if a property which may not appear on the market very often and has proven difficult to value, auctions can be a good place to get the right price.

Clive said: "With three-bedroom semis it is easier to find a comparable value with other similar homes in the same location. But with things such as castles, lavatories and beach huts its not so easy.

"So we do see a range of rare and unusual lots."

Buying at auction

  • Research the lots due for auction online or using a catalogue
  • View any properties you are interested in before the event
  • Ensure finances - a 10 per cent deposit is required on the fall of the hammer - and legal documents are in place
  • The balance must be payed within 28 days
  • Have you snapped up a bargain at auction? Or bought an unusual property on the spur of the moment? Call News Shopper with your homes under the hammer stories on 01689 885734