There are few things more frustrating for homebuyers than being gazumped. The chances are you’ll already have spent a great deal of time and money preparing to buy a property, only to have it snatched away from you before exchanging contracts.
If you’re planning to buy a property, here are five tips to help prevent you from being gazumped, and what to do if it does happen to you.
Once you’ve had an offer verbally accepted, it’s worth asking the seller to take the property off the market immediately.
This doesn’t guarantee that you won’t be gazumped, but if the property is no longer on the market it will significantly improve your chances of it not happening.
It’s usually standard practice for a property to be taken off the market once an offer is accepted, and most sellers will be happy to oblige. If they’re not, then it could be a warning sign that they’re still open to a higher offer.
It’s always a good idea to have funds in place before making an offer on a property as it can help to speed the whole process up, and that’s usually a good thing for buyers and sellers.
If you have your mortgage in principle, it shows the seller that you’re a serious buyer and that you’re able to move relatively quickly, compared to a buyer who hasn’t got the funds in place.
As with the mortgage in principle, it’s a good idea to have your conveyancing solicitor in place before starting the buying process.
Again, it can help to speed the whole process up, and it demonstrates to the seller that you’re a serious buyer who’s looking to get things moving as quickly as possible.
Finding a conveyancer that you want to use can be a time-consuming process, so before making an offer on a property, ask friends, family and your estate agent for recommendations, and check reviews so you can find someone you’re happy with.
Sometimes the personal touch can go a long way. Building a relationship with the seller and showing a genuine interest in their property, along with your future plans for it, may help persuade them not to accept a higher offer in the interests of fairness.
Of course, there are no guarantees, and a higher offer may be more attractive, but having a friendly relationship with the seller can make a big difference.
A lock-in agreement, or exclusivity agreement is a binding contract that prevents the seller from negotiating with another buyer during a fixed time period.
Both parties will usually pay a deposit, and if either side breaks the agreement then the deposit is forfeited.
This is definitely the best way to avoid being gazumped, but it’s also the least common, and a lot of sellers are likely to be reluctant to sign it. There are still no guarantees either, but as the seller stands to lose a large sum of money through their deposit, it’s arguably the most effective way to prevent gazumping.
Despite your best efforts, sometimes being gazumped is an unfortunate and unavoidable part of the home buying process. If this does happen to you, there are a couple of things you may be able to do to stop your purchase falling through.
If you have the funds to go back in with a higher offer this is likely to be your best chance of getting your purchase back on track.
However, make sure you can actually afford to go higher. If your initial offer is at your maximum, or close to it then don’t overstretch yourself financially.
And also be aware that you may end up in a bidding war. The other buyer may have a lot more room to move financially, so you could find yourself paying well over the odds, or being ultimately outbid anyway. Just make sure you have your finances in order before entering into a bidding war.
This is where being prepared comes in handy. Even if another buyer can come up with a higher offer, you may still be in a stronger position than you think.
For example, if you’re a first-time buyer then you’re chain free and potentially able to move very quickly. Perhaps you’re able to be more flexible with completion dates than the gazumper, or you have your mortgage in place and they don’t. Whatever your USP is, be sure to highlight why you’re an attractive buyer.
Austins Estate Agents are your local property experts for the Wolverhampton area.
Call us on 01902 244200 or email info@austinsestateagents.co.uk to find out how we can ensure your sale or purchase runs smoothly.