13
Sep
How to Avoid Being Gazumped!!
You’ve made an offer on a property. You might have had to
negotiate a bit, but that’s OK because this is your perfect
home and you can’t wait to move in. You then get a rather
awkward call from the
estate agent in Southend on sea to say that unfortunately the
seller, (whom you took to be a gentleman) has received a higher
offer from another buyer.
It appears your choices are limited as the vendor seems to have you
over a barrel. Either you match or exceed the other buyer’s
offer, or you withdraw from the purchase – either way you
lose. Even if you do offer more the other buyer could still come
back and even exceed that, starting a bidding war with only one
eventual winner.
Good agents do not encourage gazumping, but are obliged by law to
submit all offers in writing to the vendor, and it is the vendor
who decides how to proceed.
There's little you can do to repel a determined bidder, but there
are ways to reduce the chances of it happening to you.
Firstly, you could offer the full asking price, subject to the
property being formally withdrawn from the market. You could go
further than this and purchase a formal first right of refusal from
the vendor which would include the vendor instructing the agent in
writing not to submit any further offers, which overcomes their
legal obligation to do so otherwise. Although you might have
preferred to pay a little less than the asking price, you could
regard the extra as a form of insurance against having to pay more
following a gazumping situation.
Only offer to buy when you are in the strongest buying position.
Keep the pressure on your conveyancer, have your mortgage arranged
and rather rent for a while than allow a linked sale to disempower
you.