House auctions were once the domain of exquisite upmarket homes that were literally invaluable. Open bidding was seen as the only way to establish the true market worth of the converted water mills and stately homes that were the stuff of single-lot auctions. Nowadays, properties coming under the hammer no longer fetch penthouse prices. Instead, auctions have become the property world's bargain basement, with multiple-lot auctions shifting 150 or more properties over one- or even two-day sessions.
Last year Allsop's, one of the country's leading auction houses, shifted a total of 868 residential properties, more than three times the 261 sold in 1991. 'Around 500 were bought by private buyers for occupation rather than for investment,' said Gary Murphy, who is a company partner. 'A good majority of those were repossessions.'
Building societies, with thousands of repossessions languishing on estate agents' books, have channelled many of them through auction houses over the past two years, prepared to take a loss for the sake of a speedy sale rather than hang on to a depreciating asset. There's about one auction a month in London, covering properties from across the country. Each auction catalogue reads like a roll call of casualties of the property slump, with the words 'By Order Of Mortgagees In Possession' in obituary-style black type across at least half of the entries.
They're all in there, from former council maisonettes in Chatham (sold for pounds 13,500), to newly built but unsold luxury stable conversions in Tunbridge Wells ( pounds 70,000) and Docklands studio apartments overlooking the Thames (knocked down at pounds 41,500, including use of swimming pool and health club).
'We valued that particular property at pounds 58,950 and advertised it everywhere,' said the estate agent who originally handled the Docklands apartment. 'We didn't get a whisper of interest in over three months. You can see why the building society would prefer to let it go at auction at pounds 20,000 less. If I was buying at the moment, I wouldn't do it through an estate agent. You'd find me at an auction.'
Which is where Melissa Biro ended up just before Christmas, one of a growing band of private buyers who have swelled the crowds at recent property auctions, bidding against the professional landlords and property speculators who used to have the floor to themselves. The property she had in her sights was a first-floor flat in Dulwich, south London. She and her husband had planned to go up to pounds 35,000, the price it had been advertised at previously by an estate agent.
Since it was Lot 157 out of the 161 lots being sold, she had a nerve-wracking wait until late afternoon. 'I'd been to the previous day's session to get used to how it was done. I'd been to antiques auctions before, but nothing like this,' she said. 'The room was full of professionals: you could tell by the suits, their attitude - relaxed and chatty with each other, but with a constant eye on what was going on - their minimalist bidding style and the wads of notes that appeared from briefcases when they made a successful bid. They knew each other and the auctioneers knew them.'
Breaking into this auction-house society of sharp practitioners can be an intimidating business. 'I remember my heart beating very loudly as the bids opened on Lot 157,' said Ms Biro. 'But I figured that professionals were after a bargain and so were less likely to push up prices than a room full of keen amateurs. Having spent a day watching how it was done, I had a strategy.' She allowed two besuited professionals to bid against each other, until one dropped out at pounds 18,500. She then stepped in with a bid of pounds 19,000. The next few minutes were a blur, with the auctioneer flitting back and forth between her and her rival bidder, first rising in steps of pounds 500, then dropping to pounds 250 increments as the pace slowed.
'I don't remember exactly how many times it came back to me, probably three or four. But at pounds 20,500 he suddenly dropped out. I'd got it at pounds 15,000 less than we were prepared to pay.' Ms Biro and her husband now own a whole house at a knockdown price, since they were already living in the flat below the one that she successfully bid for.
The speed with which Melissa Biro's transaction went through illustrates the main benefit of buying at an auction. 'It's a quick and certain sale,' Gary Murphy said, which compares favourably with the uncertainty and lumbering procedure of the estate agent-route. 'Once the hammer goes down, the property is sold and contracts are signed on the spot. No chains. No wavering vendors pulling out at the last minute.' 'Thirty to forty per cent of estate agent-based sales end up falling through,' echoed Maureen Freeman of General Accident.
There are, of course, drawbacks. Uninhabited properties deteriorate rapidly, and houses that come to auction have often been empty for a while. Some are dilapidated or suffering from subsidence and are auctioned because they won't sell elsewhere. The Penzance cottage, for example, turns out to have no bathroom and an outside loo.
And then there's the question of conscience. Picking up a bargain repossession is one thing. Living with the thought that people were probably kicked out of their home to make way for you is another. Ah well, just when you thought it was beginning to sound like a good idea . . .