Property auction rooms are set for a sales frenzy with thousands of buy to let properties going under the hammer.

The number of repossessed properties going to auction is up 100% on 18 months ago and specialist lender, Auction Finance Limited, says an increasing number of these are buy to let properties. Recent research shows that buy to let properties are three times more likely to run into trouble than normal residential homes.

Speculative landlords entered the buy to let sector when property investment was seen as a guaranteed to make money. The recent turn in the market has led to compressing rents and for many, being a residential landlord is no longer a lucrative business.

Chris Baguley, director at auction lending specialist Auction Finance Limited, says:

"With prices as low as 60% of what the mortgagor originally paid, it's clear why auctions have become so popular. It's only going to get even busier towards the end of the year.

"Many investors expanded their property portfolios during the boom years and are now finding they can't let them, or if they can, the rent is not covering their mortgage. Many banks are withdrawing mortgage offers, leaving landlords unable to keep their properties. This means repossessions of buy to lets are likely to increase in coming months, and many of them will end up in the auction room."

The Treasury Select Committee (TSC) launched an inquiry into Britain's struggling mortgage market to examine the sharp rise in repossessions. The inquiry was announced following a warning that repossessions will not peak until 2011.