Why is it that we still allow the practice of gazundering and gazumping? I am sure many of you have been on the receiving end of one or other of these two very unfair practices and in turn have been forced to treat someone else along the property chain in the same way just in order to be able to move.
If you put in an offer on a property AND it is accepted, morally, if not legally you should honour that offer, except where a search or survey reveals something that was not known at the time of the offer. If no such revelation exists there simply is no moral justification for lowering your offer.
Gazundering unfortunately seems to be more common place at the moment as property prices are depreciated. To anyone who thinks it is acceptable to put in an offer then just prior to or at Exchange of Contract put in a lower offer with no good reason, I would say this: It is not clever, it undermines the value of all property, including the property you are buying, and in turn it plays a part in jeopardising the recovery of the economy.
Those who think it is acceptable to engage in gazundering when property prices are falling who later come to sell the property they purchased on a revised down offer, are also the very same people who engage in gazumping. Accepting a higher offer, having already agreed a lower offer with another buyer is equally unjustified. If you accept an offer on a property, it is morally, if not legally wrong to fail to honour your first agreement on the lower offer. There simply is no justification for seeking another buyer when you have already accepted another offer.
Gazumping is more often encountered where property prices are climbing and to anyone who thinks it is acceptable to continue to market a property where a sale price has been agreed, I would say this : It is not clever, it falsely inflates property prices, including the price of the property you might wish to buy and undermines the stability of the economy.
If this new Coalition Government would like to see stability in property prices, both commercial and residential, it should look over the border to Scotland. The best way to encourage prices to find their natural economic level would be to introduce the Scottish system whereby the buyer must submit a written offer and the seller must accept the offer in writing. This effectively prevents gazundering except in cases where previously unknown facts such as building faults are revealed, and it prevents gazumping as it forbids solicitors to act for a second prospective purchaser where there is a prior written offer that has not been withdrawn due to defect of the property.
If you fear that you may be the victim under our present law, of gazundering or gazumping with the financial risk of wasted legal costs, my tip is to talk to your Solicitor about the possibility of asking the other party to give an Undertaking to pay your legal costs in the event of an abortive sale.
Tags: Conveyancing, gazumping, gazundering
Home
Open Features
Members' Forum
Find Accommodation
Contact