If you are a property purchaser, you will be all too familiar with the horror stories around being gazumped.
We thought it would be helpful to take a closer look at this issue to help you avoid becoming one of the unlucky few who find themselves in this costly and stressful situation.
If you have had your offer accepted on a property, it may feel like you are well on your way to getting the keys and beginning your journey into property ownership. Whether this is your first home, a buy to let, upsizing or downsizing, the excitement can be overwhelming.
However, it is important to exercise caution. Until contracts are exchanged, the sale is not legally binding. This means there is still a real risk of being gazumped.
So, what is gazumping? The Cambridge Dictionary defines gazumping as:
The practice of refusing to sell a house to someone after you have agreed to sell it to them, and selling it instead to someone who offers to pay more.
In simple terms, gazumping happens when a seller accepts an offer from a buyer but then goes on to accept a higher offer from someone else before contracts are exchanged.
Because contracts have not been exchanged, the seller is under no legal obligation to honour the original agreement. If a higher offer is made, they can choose to accept it, leaving the first buyer high and dry.
For the buyer who has been gazumped, this often results in financial loss due to non-refundable expenses. These can include solicitor fees or costs for surveys such as a Level 2 or Level 3 Home Survey. From a surveying perspective, it is particularly frustrating as the report will no longer serve any purpose.
Finding a positive: If the surveyor’s report was comprehensive and you were pleased with their service, this can be a small positive. It confirms that you have found a reliable surveying team who can support you with your next property.
If the report was not up to your expectations, you now have a better understanding of what to look for when choosing a surveyor for future purchases.
Our advice to buyers: The most effective way to reduce the risk of being gazumped is to minimise the time between offer acceptance and exchange of contracts. The shorter this window, the lower the risk.
Make sure your surveyor carries out the Home Survey quickly and delivers the completed report without delay. At Stokemont, we offer one of the fastest turnaround times in the market. We typically complete reports within one to two days following the inspection.
Likewise, make sure your solicitor acts promptly and follows up consistently with the seller’s solicitor to keep the process moving.
We take great pride in our Home Survey turnaround. Our instant online quote system allows you to receive a quote in seconds. You can also instantly book the survey with us, following which we will arrange the inspection within one to three days. Once we have visited the property, you will receive the full report within one to two days.
Although you can take steps to reduce the chances of being gazumped, the risk can never be completely removed. If you are unfortunate enough for it to happen, try to stay positive, take the experience in your stride, and move forward to the next opportunity armed with knowledge and confidence.
