There are fears that gazumping is becoming an increased threat for home buyers, according to some estate agents.
More buyers are willing to outbid other potential buyers, in a bid to secure a home. According to research conducted by Countrywide estate agents, gazumping has impacted on 3.6% of purchases, the highest level for six years. Another survey, conducted by eMoov estate agents, reports that 36% of buyers had been recently gazumped, up from 2015’s figure of 13%.
Experts believe that this may be happening due to the shortage of affordable homes on the property market. In England, the practice isn’t illegal, as either party can withdraw from the agreement until the exchanging of contracts. Gazumping is the practice of a seller accepting an offer on their home, and then rejecting it when they receive a higher bid from another buyer. The original potential buyer may already have invested a lot of money into the purchase, starting the conveyancing process.
Although eMoov found that the practice of gazumping was worse in London than other areas of the country, Countrywide found that the east of England experienced higher rates of the practice. In 2016, the government stated that it would conduct a review into gazumping, and attempt to improve the conveyancing process.
Gazumping is one of the issues which mortgage advisors will learn about when they take a CeMAP training course, so buyers could seek advice on how to reduce the risk of it happening to them.
