For many, purchasing a home is a significant milestone. It’s often the culmination of years of hard work, saving, and planning. However, the journey from deciding to buy a house to actually securing the keys can be fraught with challenges, not least of which is a phenomenon known as “gazumping.” Gazumping occurs when a seller, after having already accepted an offer, decides to accept a higher bid, leaving the original buyer out in the cold. This can be not only emotionally distressing but also financially burdensome, as potential buyers often invest in surveys, legal fees, and more, only to have their plans dashed at the last moment.
The Unfair Reality: Gazumping Isn’t Illegal
Though gazumping can feel deeply unfair, it’s essential to understand that it’s not against the law. “Until the contracts are exchanged, either party — buyer or seller — can change their mind,” explains Jonathan Rolande from the National Association of Property Buyers. This aspect of property law underscores the importance of being prepared and moving efficiently through the buying process once your offer has been accepted.
Quick Steps to Secure Your Purchase
One critical piece of advice from experts is to act swiftly. Suzanne Morgan, area director at Purplebricks estate agents, points out that by law, estate agents must present all offers to the seller. Still, sellers are less inclined to consider other proposals if the original buyer has shown dedication and speed in moving the process forward.
Thus, it’s vital to:
- Instruct solicitors promptly.
- Pay for necessary searches and surveys immediately.
- Return all required paperwork without delay.
“The quicker these steps are taken, the less likely you’ll face gazumping,” Morgan adds.
Another essential preparation is securing a mortgage agreement in principle. This preliminary step doesn’t require a full credit check but confirms the amount you’re able to borrow, demonstrating to sellers that you’re a serious buyer.
The Power of Personal Connections
The property market isn’t just about houses and money; it’s also about people. Ben Waites, of WS Residential, highlights the importance of personal relationships in property transactions. Sellers are often more likely to finalize a sale with someone they feel a connection with, someone they believe will appreciate and care for the property as they have.
Rolande concurs, advising buyers to try and meet both the estate agent and the seller in person. Sharing why the property is perfect for you can create a personal bond that might dissuade sellers from accepting another offer.
Red Flags and Protective Measures
Stay vigilant for any signs the property is still actively marketed after your offer is accepted. Continual advertising could indicate the seller’s willingness to consider other buyers.
Moreover, you can seek a “lock-out agreement,” a contract granting the buyer exclusive rights to purchase the property within a certain timeframe. However, these are not commonplace and might not be looked upon favorably by all sellers.
Insure Your Investment
Given that there’s no absolute way to prevent gazumping, Tabitha Cumming, a property expert from The Lease Extension Company, suggests homebuyer protection insurance. This insurance can help recoup conveyancing, survey, and other fees if you’re gazumped.
Know When to Walk Away
Finally, if you do find yourself being gazumped, assess whether it’s prudent to make a counteroffer or if it’s better to walk away. “If it’s happened once, it could happen again,” says Suzanne Morgan, implying that even if you raise your bid, the seller might not be entirely reliable.
Conclusion
Gazumping is an unfortunate reality in the property market, one that can lead to both financial loss and emotional distress. However, by taking swift action, establishing personal connections, and being vigilant, you can decrease your chances of falling victim to it. And remember, it’s crucial to know when to persist and when to simply move on and find a property with a more dependable selling scenario. After all, the journey to finding your perfect home should be one paved with excitement and assurance, not fraught with uncertainty and disappointment.