Buying property can be rather difficult. This is doubly true if the market is particularly competitive. Indeed, the process of buying property can be quite daunting. Now, nothing hurts more than finding property that you like only to have it swooped up from under you. This is called gazumping. You'll want to do all you can to avoid gazumping. To help you out, we thought it would be useful to put together a brief article about this subject. If this is something that you want to learn more about, read on as we break down everything that you need to know about gazumping.
What Is Gazumping?
Gazumping is an unfair practice in England and Wales whereby a seller accepts an offer from one buyer, and then accepts an offer from another buyer, effectively outbidding the first buyer. This can be very disappointing for the first buyer, who has often already started the buying process. In Scotland, the law is different, and gazumping is not possible. Being gazumped means that even after comparing conveyancers and starting the buying process, you could still be outbid.
Gazumping shouldn’t be confused for gazundering as they are vastly different from one another. Gazundering is when the buyer of a property decides to lower their offer price before contracts are exchanged. This can occur at any time before the transaction is legally binding. The seller then has to decide whether to sell the property at a lower price or to market it again in the hope of finding a buyer who will pay the original price.
Is Gazumping Legal?
In the UK, there is no law against gazumping. This means that if you’re buying a property, the seller can legally accept a higher offer from another buyer, leaving you out of pocket and without a home. While gazumping is not illegal, it is considered unfair and is often seen as a dishonest way of selling a property.
This can be extremely frustrating for buyers who have already spent money on surveys and solicitors fees, only to be left empty-handed at the last minute. If you’re in the process of buying a property, it’s important to be aware of the risks of gazumping so that you can protect yourself as much as possible.
Why Does Gazumping Happen?
There are a number of reasons why gazumping might happen:
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The seller may have had a change of heart and decided they don't want to sell after all.
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The seller may have been unhappy with the buyer's offer and decided to try and get a higher price.
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The seller may have been approached by another buyer with a higher offer.
Whatever the reason, gazumping is a frustrating and stressful experience for buyers who have often already spent a lot of time and money on the purchase. The best way to avoid being gazumped is to be as prepared as possible before making an offer on a property. Get your finances in order, and be ready to move quickly if your offer is accepted.
Instruct your solicitor to progress the purchase as quickly as possible once your offer is accepted. And finally, try to be realistic about the property you're buying and the current market conditions. If you're in a strong position and are confident about your offer, there is less chance of being gazumped.
How Do You Avoid Being Gazumped?
There are a few things you can do to try and avoid being gazumped:
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Get your offer in as soon as possible. The sooner you have your offer accepted, the less time there is for another buyer to come in and make a higher offer.
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Be prepared to move quickly. If you can exchange contracts and complete the sale quickly, it will be harder for another buyer to gazump you.
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Try to be flexible on the price. If you are not too fixed on the price you are willing to pay, it may make it easier to reach an agreement with the seller.
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Use a solicitor or conveyancer who is experienced in dealing with property transactions. They will be able to give you advice on the best way to proceed.
If you do find yourself in a situation where you are being gazumped, there is not a lot you can do. You may be able to negotiate with the seller to try and keep your offer on the table, but ultimately it is up to them to who they sell the property.
What Should You Do If You’ve Been Gazumped?
If you find yourself in the middle of a gazumping situation, it can be very frustrating and stressful. However, there are a few things you can do to try and protect yourself. Firstly, it's important to get your offer in as soon as possible. This will give you the best chance of having your offer accepted and reduces the risk of another buyer coming in and gazumping you. Secondly, make sure you have your finance in place before making an offer. This will again help to make your offer more attractive to the seller and will mean you are in a better position to exchange contracts quickly if your offer is accepted. Finally, try to be flexible on the completion date. This can be a key sticking point in gazumping situations, so if you are able to be flexible, it may make it easier to reach an agreement. If you do find yourself the victim of gazumping, don't despair. There are still plenty of properties out there, and with a little patience and perseverance, you will find the perfect one for you.
Conclusion
We hope this article proves to be useful when it comes to helping you gain a better understanding of how gazumping works and what you can do to protect yourself from being gazumped. While it can be rather intimidating, the information that we’ve discussed above should allow you to navigate the property buying process with ease and make protecting yourself from the risk of gazumping more manageable. Be sure to keep everything you’ve learned here in mind so that you can make the most informed decisions when buying property.
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