Rising house prices and a shortage of properties being listed for sale has led to an increasingly competitive housing market with the average time to find a buyer in February 2022 more than two weeks shorter than in 2021.
Rightmove also recently reported that the average estate branch has just 12 properties listed for sale amid a national shortage of properties.
This low-supply of housing led to the largest ever monthly jump in property prices for more than 20 years, with the average price of property coming to the market rising by 2.3% or £7,785 to a record of £348,804.
What is gazumping?
Gazumping is where a seller accepts your offer, only to reject it should a higher offer come in, meaning you miss out on the house.
In England and Wales an offer is not legally binding until contracts are exchanged, so gazumping is legal and can occur at any stage before you have exchanged.
In a seller’s market, with rising prices and a low supply of properties entering the market, gazumping is likely to increase with buyers becoming increasingly desperate to move house.
Now mortgage experts at online mortgage broker, Mojo Mortgages, have revealed how buyers can avoid being gazumped in an increasingly competitive market.
Zarah Gulfraz, mortgage expert at Mojo Mortgages, said:
“In current market conditions, it’s easy to be tempted to offer over the asking price to beat off competition from other buyers, but this could cause problems further down the line when you come to sell the property.
Here are five tips to avoid being gazumped while avoiding offering well over market value.
Connect with your local agents
In such a competitive market, building a relationship with your local estate agents will be important to help get an upper hand on other buyers. By putting a face to a name, you can register your interest and about any properties due to come to the market imminently and express your interest.
Many properties will get dozens of viewings booked within days of going on the market, so being able to get ahead of the queue could be the difference between a successful purchase or being gazumped.
Build rapport with the sellers
Establishing a connection with the sellers during viewings can help to prevent them accepting another offer at the last minute.
Houses can mean much more than bricks and mortar and it can be reassuring for sellers to know their home is in safe hands. Making it clear that you are a serious buyer and how much you love the property could be time well spent to avoid being gazumped.
Get organised
The early stages after having an offer accepted can be daunting and any time spent trying to find a solicitor or mortgage broker could increase the chances of being gazumped by another, more organised, buyer.
Securing a mortgage in principle and finding a conveyancing solicitor ahead of time can help to reduce the stress after your offer is accepted and avoid valuable time being lost from the process.
Move quickly
The agreement between you and the seller does not become legally binding until contracts are exchanged, and purchases “subject to contract” are still listed by agents, so there is a higher risk of being gazumped until this point.
The good news is that, by being organised, you can help to speed up the process. Keeping in contact with your conveyancing solicitor and the selling agents to keep the pressure on can help to progress the sale to exchange contracts and avoid a gazumping.
Consider another offer
If you are gazumped, there are still options open to try and secure a deal. If you are confident about the market value you could gazump the gazumper by placing another higher offer but beware this could start a bidding war.
You could also try to encourage the seller to reconsider your offer. It may be that you are chain-free or a cash buyer, meaning you can progress the sale quicker.
If you have exhausted all of your options, it may be time to take the difficult decision to withdraw from the process and find another property.
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