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What is Gazumping and How to Avoid It

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What is Gazumping and How to Avoid It
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‘Gazumping’ may sound like a word from a Roald Dahl story. But it is a common technical term in the property market.

So, what does it mean? And should you accept a gazumping offer as a seller?

Read on for an answer to these questions and more.

What is gazumping?

Gazumping is when a property seller accepts a verbal offer from one potential buyer but then accepts a higher offer from someone else.

The new buyer has therefore ‘gazumped’ the first potential buyer with their last-minute higher offer.

The word itself comes from the Yiddish word ‘gazump’, which translates to ‘to steal’ or ‘to cheat’. 

However, in English, it does not have the same level of negative connotation (especially for sellers).  

The advantages of accepting a gazumping offer

While some people in the property industry look down upon gazumping offers, there are some advantages to them.

More money

The main reason for a seller to accept a Gazumping offer is that it may result in them getting more money for their property. 

Indication of interest

Secondly, a Gazumping offer can sometimes indicate that the individual is more keen on the house than their rival. 

If both have the same funds but one is offering more money… then perhaps it makes sense to sell to the person who wants it just that little bit more.

Is a gazumping offer always a good thing for sellers?

Many house sellers view a gazumping offer as good – but this isn’t always the case.

There can, in fact, be drawbacks to a gazumping offer for a seller…

Slows down completion schedule

Most sellers want to know how they can sell a house quickly. Accepting gazumping offers is generally not involved…

Gazumping requires new checks to be completed on the potential buyer – and there may be other hitches further down the line.

This can have a significant impact on the time it takes to exchange contracts

Gazundering…

It is not uncommon for someone who Gazumps to reduce their price at the final moments. 

After all, someone who Gazumps has already shown that they are not worried about upsetting others.

Therefore, the idea of Gazundering (reducing their price) at the last minute may already be on their mind. 

Thus, even though you have accepted a higher offer, you may end up no better than you started.

Costs

If a seller’s conveyancer charges by the hour, receiving a new deal will involve more work, and their conveyancing fees will increase accordingly. 

This cost increase may be negligible compared with the improved offer your new buyer is proposing, but it is still worth keeping in mind.

Avoid the uncertainty about gazumping by selling to We Buy Any Home

We Buy Any Home are chain-free cash house buyers who can purchase your property up-front and quickly, without hassle or stress.

Using our funds, we will purchase your property at a set price by your chosen date and fully manage it from beginning to end.

Fill in our enquiry form below if you want to sell your home quickly with a cash offer.

Free cash offer within minutes, any condition, any location.

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