The number of South West properties offered at auction has reached a two-year high, figures show.

According to the Royal Institute of Chartered Surveyors (RICS), 337 homes were sold at auction in the region during the second quarter of 2007.

This represents a 46 per cent increase on the previous quarter and a 47 per cent surge on the same period in 2006.

"The increase was pushed by repossessions, as affordability conditions deteriorated following interest rate hikes," RICS said.

Nationally, 5,120 residential properties were auctioned in the April-June quarter, up 22 per cent on the first quarter of this year.

Residential properties offered at auction should continue to grow, with RICS estimating that national repossessions could rise to in excess of 45,000 in 2008, amounting to 124 repossessions per day.

The South West also had the highest number of commercial properties offered at auction during the second quarter - 209.

This is a 67 per cent surge on the previous quarter and a 41 per cent increase on the same quarter in 2006.

Nationally, there were 1,228 commercial properties sold at auction during the second quarter, an 18 per cent rise on the previous three months.

RICS economist Oliver Gilmartin said: "With the full impact of interest rate rises in 2007 yet to filter through into higher mortgage costs we continue to expect a rise in the number of homes going under the hammer into 2008.

"The auction house will continue to be a quick means to foreclose mortgages where properties have been repossessed.

"The commercial property market may also see a rise in lots offered at auction as tougher conditions return to the high street as consumers tighten their belts."