BUT WHAT IS GAZUNDERING?
Most people will have heard about gazumping but, if you’re selling property, are you aware of the risk of being gazundered? Read on:
If you’ve bought or sold a house before, then there’s every chance you’ll have heard of gazumping.
This is when you’ve put in an offer on a house, the deal seems to be progressing but then, suddenly and without warning, you’re informed by the vendor that someone else has outbid you and, unless you can increase your offer to match it, you’re out.
It’s infuriating not least because you may lose the money you’ve already invested in surveys and conveyancing services but also because – at the moment at least – it’s not illegal.
However, another less-well-known risk you may face when you’re selling property is “gazundering”.
This is when you’ve accepted an offer from a buyer, the deal seems to be progressing but then, at the eleventh-hour, the buyer reduces their offer.
It may be that their circumstances have changed; for example, their lender may have imposed restrictions on how much they can borrow. It may just be a cynical bid to acquire your house for less, hoping you’ll cave in because you don’t want to see the deal collapse when you’ve come so far.
But, remember, even if the reduction is only a few thousand pounds, it’ a lot of money. Our advice would be not to respond immediately; take time to think about the impact of losing out and whether it’s something you can really afford to do.
But, like gazumping, there are also steps you can take to reduce the risk of being gazundered in the first place.
Make sure the valuation of your property is reasonable to start with; if your home is on the market for a competitive price, the buyer will be aware they may not be able to find anything else.
Tell The Truth
Don’t be tempted to tell any white lies about the condition of your property. If any defects are discovered, it gives the buyer a reason to reduce their offer.
Make It A Condition of Sale
Make it clear to the buyer that, if you accept their offer, then you will not be considering any other bid (gazumping). However, you expect them to honour their side of the deal and not reduce their offer without a legitimate reason. If there’s any hesitation, you may already have some early warning that there is a risk of being gazundered.
Ask For Evidence Before Accepting
If your buyer reduces their offer, you could ask to see written evidence of the reasons given. If they can produce it, at least you can be sure you’re not the victim of sharp practice and make a decision accordingly.
Be Ready To Negotiate
Have a strategy in mind to deal with a reduced offer should one be submitted. It’s better to be ready for the worst than have it take you by surprise. If your buyer makes a lower offer, what would you counter with?
Like many things in life, forewarned is forearmed so we hope this blog is useful. However, there are plenty more topics covered in earlier posts so, if you’re buying or selling property, why not give them a read?
If there’s anything we haven’t covered feel free to give us a call or drop us a line; we’d be delighted to help if we can.
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