5 min read
Gazumping, gazundering and gazanging can be detrimental when buying or selling a house. Find out what these terms mean and how they can effect you.
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Gazumping, gazanging and gazundering may sound like tongue twisters, but they refer to significant pitfalls in property transactions. Buying or selling a house is already a stressful experience, involving a lot of time and effort to find the right property or buyer. It’s especially disheartening when something out of your control stops the transaction from going ahead.
Find out more about each of the terms and what they mean for you below:
Gazumping occurs when the seller accepts your initial offer on a house yet goes on to accept a higher offer from another buyer before contracts are exchanged. This leaves the original buyer disappointed and potentially out of pocket for any expenses incurred during the process.
Gazanging happens when a seller decides they no longer want to sell their house at all and pulls out of the house sale at the last minute. This abrupt change can leave potential buyers without a property and facing unexpected costs.
Both gazumping and gazanging can significantly impact buyers by causing:
Emotional stress: The excitement of purchasing a new home is replaced with disappointment and frustration when a seller either accepts a higher offer or decides not to sell at all.
Financial losses: As a buyer, you may lose money spent on surveys, valuations, and legal fees.
Wasted time: The efforts invested in the process are lost and you must start your property search anew.
Unfortunately, there’s not much that can be done when being gazanged, as ultimately if the seller decides they no longer wish to move, they are within their rights to take the property off the market.
However, when it comes to gazumping, there are a few things you can do to reduce the risk and protect your investment. You can request that the house is taken off the market as a condition of your offer. Additionally, it’s a good idea not to pay for any searches or surveys until the property is off the market, so your risk of financial loss will be reduced.
Acting quickly and being prepared can also make a significant difference. By having your finances in order, such as obtaining a mortgage agreement in principle, and instructing a conveyancing solicitor early, you can progress the sale promptly, minimising the window in which gazumping can occur.
Unlike the other two terms, gazundering effects the seller in a property transaction. It is the term for when the buyer of your property drops their offer price late into the conveyancing process, just before you’re about to exchange contracts.
This can be highly frustrating for sellers as they’ll have to decide if the time and money already contributed towards the sale of the house is worth losing the buyer. It can be a hard decision, as it’s also not guaranteed you will be able to find another buyer at the same price. If you’re in a chain, the decision could impact whether you’re able to continue with your ongoing purchase, and so it really is a big one to make.
If you’re selling your house and need a conveyancer to act on your behalf, you can get a personalised quote using our online calculator. For help on the conveyancing process, watch our video on how the conveyancing process works
While gazundering cannot be entirely prevented, you can take proactive measures to reduce the risk:
Make sure the buyer has financing in place, such as a mortgage agreement in principle to ensure they are financially capable of completing the purchase. Choosing chain-free buyers – those not dependent on selling another property – can reduce the risk of delays or complications.
Price your property accurately based on current market values. Overpricing can lead buyers to reassess their offer later. Be upfront about any issues with the property to build trust and reduce the chance of the buyer trying to negotiate a lower price.
Stay in regular contact with the buyer to address any concerns promptly. By being proactive and responsive, you can work together to resolve any issues that come up during surveys or legal checks. This builds trust and reduces the likelihood of the buyer lowering their offer.
Prepare all necessary documents early and use an experienced conveyancer. Agree on timelines and stick to them to reduce delays, which can lower the chance of gazundering.
Propose an agreement where both parties commit to the sale terms for a certain period. This can provide additional security. Consult your solicitor to make sure the agreement is legally sound.
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