The Auction House UK says the industry could end up benefiting from the forthcoming downturn in the property market, because it provides the quickest and simplest solution to sell unwanted property.

Jeremy Prior, Managing Director of Auction House UK said: “Last week the Bank of England announced a rise in interest rates of half a percentage point, the biggest increase in the cost of borrowing for 27 years. What’s more, many experts are predicting that inflation could hit 15% by the middle of next year. Plus, the UK is predicted to fall into recession later this year, with the longest downturn since 2008 expected and gross domestic product falling by as much as 2.1%. Together, this will inevitably have a significant impact on the mortgage market in particular and the housing market in general.

“But it also means that some buy-to-let landlords and investors will decide to divest themselves of part or all of their portfolio – and the most obvious route for them to do so is by auction. In fact, it might actually mean an increase in the number of sales and amount of money raised on behalf of our clients.”

He added that the speed and certainty offered by the auction process could help sellers overcome some challenges.

“We have already seen a slowdown in the market, with a drop in active bidders of around a third. We’re also hearing reports within the private treaty market of valuations being downgraded by lenders and deals taking much longer to complete,” added Jeremy. “That’s not the case at auction, where both buyers and sellers appreciate the speed and certainty of the process and the deal is done on the fall of the hammer.”

“This is not to suggest that there won’t be challenges ahead for the auction sector. But we do have a degree of resilience not evident elsewhere,” he concluded.