June 27, 2016

A change in the rules could spell the end for gazumping

Around one in five property deals fall through as a result of “gazumping”, a new study has shown.

The practice of accepting a better offer after having already made a deal to sell to someone typically leaves people facing an average loss of £2,899 – which includes conveyancing and mortgage valuation fees.

This month’s survey, outlining the extent of the problem, comes hard on the heels of news that the Government is weighing up proposals which would make it significantly more difficult to pull out of a deal at the eleventh hour.

Policy chiefs from the Department for Business, Innovation and Skills recently sat down with the National Association of Estate Agents to outline proposals.

At present, an agreement is not legally binding in England and Wales until contracts have been exchanged.

It’s understood ministers are considering adopting rules similar to those already in force in Scotland, where individuals could be liable for losses if they withdraw after an offer has been accepted.

David Blake, from Which? Mortgage Advisers, said: “No one wants to see their dream property slip through their fingers, particularly if it leaves you out of pocket, but there are steps you can take to ensure you are in the best possible position.

“The best way to protect yourself from your purchase falling through is to avoid a lengthy chain.”

Mark Hayward, of the National Association of Estate Agents, added: “We need speedier transactions and a simplified legal system that makes deals binding at an earlier stage.”

At Royds, our residential property team has a wealth of experience handling transactions around London and further afield. For more information on the services we provide, please contact Deborah North or Relf Clark or visit.

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