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Rics: Fewer homes sold at auction

The credit crunch has been blamed by the Royal Institute of Chartered Surveyors (Rics) for a recent fall in the number of British properties sold at auction.

Compared with the previous year's total of 69 per cent, just 57 per cent of homes under the hammer in the last quarter of 2007 were successfully sold, research from the institute shows.

A corresponding rise of 50 per cent of houses remaining unsold was marked by UK auction houses - a sure sign of falling demand.

Oliver Gilmartin at Rics 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."

In the wake of the credit crunch, many lenders have tightened their criteria for suitable borrowers - making home loans harder to come by.

The economy as a whole has also been affected by the crunch - with several surveys showing a cooling-off in house price inflation.

Mr Gilmartin added: "Whilst tightening credit conditions will be most acute for those with a poorer credit history, 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 property books."

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