Inside UK Property Auctions: Repossessions, £1 Homes, and the Housing Crisis

Amid the high-stakes bustle of numbered paddles shooting up and gavels banging down, a woman shouted desperately from the corner of the auction room: “That’s my house,” as her home of 20 years was put up for sale.

“I live there. You can tell the people who are bidding I’m not coming out of my house,” she continued.

But nothing could halt the cut-and-thrust of the sale. The besuited auctioneer carried on fielding bids for the three-bedroom house in north-west London, which quickly shot past £400,000. After the woman’s final plea, the hammer slammed down. “A little bit late, madam – it’s been sold,” the auctioneer announced, moving on.

This cutthroat reality unfolded at the De Vere Grand Connaught Rooms in central London, once a Freemasons’ meeting place, now a glitzy events venue. There, 300 properties from across England and Wales were listed for sale, including repossessed homes, debt-laden housing association stock, and a boarded-up house in north-east England with a guide price of £1.

Property auctions are big business. Nearly £5.9bn worth of residential and commercial stock sold this way in 2025, up from £5.5bn in 2024, according to Essential Information Group, a tracking firm. Repossessed homes now represent more than 20% of the auction market, boosted by higher mortgage rates and the cost of living crisis. Government figures show 14,025 mortgage repossession orders in England and Wales in 2024, the highest in five years.

“There will be repossession properties coming through on a weekly basis at auction,” said Alex Greaves, a property buying agent at Ridgestone Property. While not expecting a flood of “distressed assets from regular homeowners” like during the financial crash, he noted an “uptick” of repossessed properties in central London.

At the Grand Connaught Rooms, the hall was heaving when lot 001, a hollowed-out one-bedroom basement flat in Pimlico, London, sold for just over £450,000. It was followed by high-value properties across southern England: a four-bedroom townhouse in Wapping by the Thames went for £800,000; a three-bedroom maisonette on Portobello Road in Notting Hill, with a £500,000 guide price, remained unsold; and a Devon bungalow with a sprawling garden fetched £327,500. A buyer’s premium of 2%-5% typically goes to the auction house.

These events are no longer dumping grounds for “Homes-Under-the-Hammer-type properties,” said Liam Gretton, an estate agent in Wirral, Merseyside. High-quality homes are increasingly auctioned. “If you have a Picasso, where would you sell it? You would take it to auction.”

As the day wore on and properties farther from London came up, people filtered out, but a sizeable number—including many young faces—remained, raising paddles hoping for bargains. Interest among young people and first-time buyers appears to be rising. Greaves said he recently helped a first-time buyer secure a flat at auction and has seen other clients “keen to engage with auctions” for sought-after properties like family homes near good schools. “The good stuff gets snapped up really quickly,” he said.

The auctioneer, continuing after lunch, touted modestly priced homes in southern England (outside London) and the East Midlands, many listed as family-ready with some renovations needed.

Alice Helps, 26, bought her “dream home” in Somerset at auction last April. “Where I live, I couldn’t afford a sparkly new-build,” she said. “So having a renovation project was a good way to get on to the housing ladder.” Her first in-person auction, surrounded by “middle-aged farmers,” was overwhelming. She went with her then-boyfriend. “Everyone was staring at us,” she said. “It was horrible. I did not enjoy it, having to put your hand up and everyone looking at you.”

After searching online, she found a three-bed semi-detached house near her family, with a guide price of £145,000. She viewed it but bid virtually. “I did it on my lunch break while working from home,” she said. “I was shaking.” In a three-way battle, she won the house for £178,000. “For my area, it was very cheap. I wanted it for roughly £200,000 but I believed it would go for about £225,000.”

The news took a moment to sink in. By then, she was newly single and bought the house on her own. “I was just very overwhelmed, happy, and feeling immensely grateful because I did not think I had a chance in hell with it,” she said.

She paid her deposit—saved since age 18—and took out a mortgage open to auction buyers. When she got the keys a month later, she expected work: a new roof and some modernizing. But a structural engineer discovered a problem. “He said: ‘I think you need to check your gable,’” she recalled, referring to the triangular wall section where roof sides meet.

After gutting upstairs ceilings, Helps realized fixing the roof would be trickier and more costly than expected. “I could see that the top of the gable in the attic was going in and the bottom was pushing out,” she said. The expert recommended demolishing that part of the house: “‘If that was to fall in,’ he said, ‘it could potentially kill you.’” There was no going back; the gavel had fallen. “It’s a negative of the auction because you’re buying it as seen. Some of these issues you don’t know until you start gutting the place.”

Helps originally budgeted £50,000-£75,000 for renovations but revised that to £100,000. She has enough saved. “I’ve still not moved in,” she said. “I’m hoping to by Christmas.”

She does not regret her decision. “The houses that go to auction are normally big projects. Just be 100% certain, because there’s no going back,” she said. Despite unexpected costs, she estimates saving over £100,000 and expects the refurbished home to be worth £400,000-£425,000.

By late afternoon, the auction room was nearly empty, with most homes hundreds of miles away in north-east England. The crowd thinned to three when a three-bedroom home in Horden, County Durham, needing “full scheme of refurbishment and modernisation,” came up with a £1 guide price. No one in the room bid, but an online battle ensued. The north-east is touted as the UK’s high-yield capital, and Zoopla says County Durham offers the best returns for buy-to-let investors.

Some of England’s most deprived areas have seen homes sold at auction and rented to families relocated from prosperous regions where local housing allowance (LHA) is too low to cover private rents. Firms like Reloc8 UK have received millions in public money to facilitate these moves.

The former mining village of Horden has become a stark symbol, with numbered streets rapidly filling with lower-income families moved there by councils in London, Birmingham, and south-east England.

LHA in Horden for a three-bedroom home is £126.58 per week, regardless of condition, yielding nearly £6,600 annually for landlords. Joanne Thorns, project manager at Communities Together Durham, said she has seen Horden properties sell for £5,000-£10,000. “For a landlord to buy that and then do it up a little bit, they’re going to make their money back pretty quickly.”

I visited Horden in late 2024. While it has become a morbid fascination for YouTubers and TikTokers filming boarded-up homes with fake doors, the area offers more. A regeneration plan for the numbered streets is underway, though residents have launched a legal challenge. Nearby are an earthy beach with rugged cliffs, Castle Eden Dene national nature reserve, and Denemouth Viaduct.

People seem to look out for each other. When I left, a young man tapped his card for my snack after I struggled to find my bank card. He refused cash repayment.

That doesn’t mean all newcomers get a warm welcome. Thorns says incoming families—often refugees and single women with children—are “often not told anything about the area” and “usually sent up in a taxi with whatever they can carry.” Homes typically lack flooring and contain minimal furniture: “a bed for each member of the family, a fridge-freezer and a cooker.” Families are moved to half-empty streets. “If four or five houses around you are all boarded up, it’s very difficult to start forming relationships.” The charity helps them register with GPs and enroll children in school. “We’re just trying to make them feel welcome,” she said.

The issue has become a political lightning rod. Reform UK pledged to put “local people at the front of the queue” for social housing in last year’s local elections, winning control of the county council with 65 seats, reducing Labour—the largest party in Durham since 1919—to four seats. Social media claims that properties in a housing development were sold to London councils for homeless families were denied by a councillor: “No phases, plots or individual dwellings have been sold to anyone or any organisation.”

Durham county council’s deputy leader, Darren Grimes, faced criticism for sharing an AI-generated image of men of color disembarking from a coach outside a row of homes, complaining about southern councils moving “problem tenants, recent refugees and homeless families” to the area. Grimes did not dispute the image was AI-generated, saying it “was obviously for illustrative purposes.”

The reality is that most families are sent to Durham under private-sector discharge, signing a tenancy for a private rental arranged by distant councils trying to limit social housing demand or reliance on temporary accommodation. As Thorns put it, they are told that “as far as the council sending them up is concerned, it’s a suitable property” and refusal could make them homeless.

Back in London, lot 300—the final home—was a tenanted three-bedroom home on the Wales-England border. The room was nearly empty, but the auctioneer, still pristine, closed the sale with aplomb: going, going, gone for £138,000.

And that “£1” home in Horden? It fetched £3,500. As the auctioneer said, there’s “potential for an excellent return.”

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