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What is Gazumping and How Do I Avoid It?

If you’re buying a house or flat, then gazumping is something that could happen to you. But what is gazumping? Find out more about this piece of property jargon.

Faye deGavre


May 26, 2021


5 min read

What is Gazumping and How Do I Avoid It?

Buying a home should be an enjoyable experience, and in many cases, the process runs smoothly right through to completion day. Once you have your agreement in principle, had your offer accepted and are happy with the results of any searches and surveys, there are few hurdles left to clear that could stop you from getting the keys. But one of them is gazumping. 

When demand is high, sellers can receive an influx of (better and higher) offers once they’ve already accepted yours. If another party makes an offer that is accepted over yours, you’re sent back to square one, possibly a fair bit out of pocket. Below, we explore how gazumping works, whether you can avoid it and what to do if it happens to you.

What is gazumping?

The simple fact is that making a verbal offer on a house and getting it accepted isn’t enough to guarantee the sale. In most cases, gazumping occurs when a seller accepts one offer on a property but then receives a better offer and accepts that one instead. While it usually happens because the seller wants to maximise their profit from the sale, it can also occur if the buyer is dragging their heels over any part of the purchase. 

According to the research Market Financial Solutions conducted, nearly a third of buyers had been gazumped and lost out on a home. The gazumping hot spot was London, where almost half (47%) of buyers had been gazumped. 

Is gazumping legal?

As unfair as it may seem, gazumping is entirely legal and can occur at any time before the contracts have been exchanged, without the seller suffering any major consequences (except maybe a guilty conscience).

Estate Agents are obliged to pass on all offers, so if a bigger and better offer comes in, you may find yourself gazumped.

However, if the seller accepts a better offer once the contracts have been exchanged, the buyer is within their rights to sue them for any losses, and they may be able to claw back their deposit. 

Much is made of Estate Agents being instigators of gazumping, but this is often far from the truth. By law, Estate Agents have to inform sellers of every offer they receive in writing, regardless of whether or not the vendor has accepted a previous offer. Agents can give guidance and advice, though the seller will make the final decision, and if they want more money from the sale, they may be inclined to accept the gazumper.

Will I lose any money if I’m gazumped?

If you’re gazumped, you may lose the money you’ve spent on surveys, mortgage arrangement fees, and the conveyancer fee for local searches. The key legal milestone comes relatively late into the process after you’ve spent time and money on securing a mortgage, sorting out paperwork and paying solicitor fees. According to Which?, the overall average cost of a sale falling through is £2,899. 

So, is there anything you can do to avoid being gazumped and safeguard against the expense?

How to avoid being gazumped

After learning more about this issue, you’re probably wondering how to stop gazumping and land your sale in one swift move. While there’s nothing to stop a seller from accepting a higher offer, here are some steps you can take to reduce the risk of falling victim to gazumping.

  • Be prepared

The longer a sale takes to go through, the more chance you have of getting gazumped, so it helps to keep things moving as quickly as possible. Before you make an offer on any house, make sure you have a mortgage agreement in principle* in place. You should also research conveyancing solicitors and land on the firm you want to use in the sale and get all the necessary documentation together. You can also line a surveyor up so you can organise a survey as soon as you’re ready to move forward.

*A mortgage agreement in principle is essentially a letter from a lender declaring how much they are willing to lend, based on an initial assessment of your profile.

  • Seal the deal as quickly as possible

This is the best chance you have of holding onto the sale. Once the contracts have been exchanged, the agreement is legally binding, so you want to reach that point as quickly as possible. Keep in regular contact with your mortgage broker and conveyancing solicitor to keep the pressure on and ensure your case doesn’t fall by the wayside. Read, sign and return paperwork as quickly as you can. 

  • Get the timing right

If you need to sell your property before you buy, make sure it’s on the market as soon as possible. Ideally, don’t make an offer on a property until you have one on the property you’re selling. 

  • Consider a lock out agreement

A lock out agreement is a contract between the seller and buyer stating that the buyer has the exclusive right to purchase the property within a time frame. While the seller must be willing to sign this, drawing it up can help to prove to them that you’re serious. Talk to your conveyancing solicitor about what would be involved and the cost of creating the agreement. 

  • Ask for the property to be taken off the market

Be aware that sellers aren’t always keen to remove their property from the market, but it can be worth asking. If the property isn’t advertised, there will be a lower chance of someone swooping in with a better offer. 

  • Get insurance

While you can’t stop another buyer from coming in with a much higher offer, you can insure yourself against it happening by taking out home buyer protection insurance. If you are gazumped, you’ll be able to claim back some money lost on conveyancing fees, survey costs and any other expenses. 

Note: This insurance will not prevent gazumping but merely cover the costs.

What should I do if I get gazumped?

Typically, you will have the opportunity to match or exceed any new offers. However, this can trigger a bidding war between you and the new buyer. On the other hand, you could simply withdraw and restart your search.

Can you gazump in Scotland?

While gazumping can happen in Scotland, it is less common than in England and Wales. In Scotland, neither the buyer nor seller are contractually obliged to continue the sale until missives have been concluded. Prior to this, there is technically nothing to prevent a seller from accepting a higher offer from another buyer. 

You can find out all the ins and outs of the Scottish legislation here.

What is gazundering?

Conversely, gazundering is when a buyer unexpectedly lowers their offer last minute, before contracts are due to be exchanged. Because this can collapse the entire chain of property sales, the buyer relies on the seller accepting the lower offer to avoid starting from square one.

Find your right home

While gazumping isn’t fun or fair, it can happen in a hot property market, so it always makes sense to know your options.

Have you started your house hunt yet? With Boomin, you get a wider view of the market. See Secret Properties that are being valued by Estate Agents and jump the queue with Sneak Peeks where you can book viewings for properties days before they are published online. Book viewings and valuations with hundreds of Estate Agents, 24/7 and receive instant confirmation. Start your search today.

Faye deGavre

Content Writer