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Gazundering When Selling Your House

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The practice of gazundering -where a buyer drops the price of a home at the last minute.

It is an appalling practice that happens in the cash house-buying industry.

Whether you are selling via an estate agent or privately to a cash house buyer, we’ll show you how to avoid it.

Table of Contents

What is Gazundering?

Gazundering is when a homebuyer reduces the price they previously offered, often at the last minute. The opposite situation to gazumping, where a property seller breaks a promise to a buyer and accepts a higher offer.

Gazundering happens just before the exchange of contracts, when the seller may have no other option than to proceed. Research suggests that this is more common in a slow market. For example, a buyer may point to the coronavirus or Brexit when lowering their offer.

In a local market with less demand and the urgency to sell, it can be easy to be taken advantage of. This is particularly so in the quick house sale industry, as companies recognise when a seller is distressed.

Unfortunately, this practice is not illegal and continues to happen. We’ll show you how to avoid it.

Can gazundering ever be justified?

Gazundering is not acceptable. It is a situation in which a buyer suddenly lowers their offer on a property after the seller has accepted their initial offer.

This happens when buyers get cold feet and start to feel uncertain about their decision due to factors such as a drop in the market or other concerns. It is unfair to the seller to string them along in this way.

In such situations, the right thing to do is to give the seller enough time to re-market the house before the conveyancing process begins. This will help them to avoid other buyers noticing the lapse in the process.

However, there are some cases where gazundering may be more understandable. For example, if the buyer has experienced a similar situation with their house sale and must lower their offer to proceed.

It can also be the case if the seller has been dishonest or has not disclosed important information about the property, which is often revealed in the survey. In these cases, it is easier to sympathise with the buyer’s position.

‘Gazundering’ When Selling Your House
If possible, try to avoid a chain sale. It usually has its advantages; the buyer will be keen to move and have their finances ready to buy your house on the agreed date.

How to Deal with Gazundering?

If you’re selling your house at auction, it’s impossible for gazundering to occur unless you have sold via the Modern Method of Auction. When contracts are exchanged, they become irreversible once the hammer falls. Companies like ourselves, which buy any house, have too much to lose by engaging in such tactics.

  • If you’re selling your house through an estate agent, however, there are a few ways to help. Counter-offer, fight fire with fire! Don’t accept the first ‘gazundered’ price; remember that the buyer has likely spent money on surveys and legal fees. Most buyers would want the sale to go through just as much as you.
  • Work with an experienced solicitor. Solicitors who have worked in the industry for a long time are likely to know all the tricks. These good ones will know how to handle the situation and communicate with the buyer’s solicitor. They will also be able to detect if the buyer is acting in bad faith and take action to prevent it. 
  • Work with a trustworthy estate agent as well. They should be proactive in dealing with the situation, considering they have likely met the buyer. Agents who have been in the industry for a while can tell the difference between a serious and not-so-serious buyer. They should also find out as much information about the buyer and pass it on to you. 
  • Price your property fairly to reduce your chances of getting gazundered. Using our guide on how to value your house can help. Also, be wary of offers that are over the asking price. The buyer might be looking to drop the price as the sale progresses.
  • If possible, try to avoid a chain sale. It usually has its advantages; the buyer will be keen to move and have their finances ready to buy your house on the agreed date.
  • Finally, make sure the buyer completes the survey as soon as possible. This will help to identify any issues early on in the process.

Speak to the estate agent about a backup plan

If there’s been a lot of interest in your property, it’s a good idea to talk to the agent about having a ‘Plan B’ in case things don’t work out. They may be able to reach out to other potential buyers, who can step in if necessary.

Set the Date for Exchange of Contracts

Establish a firm date for the sale. The longer it takes, the higher the risk.

Once you have completed the relevant property documents, the solicitors should start working on the contracts. Ensure the buyer has a mortgage offer to set a definite exchange and completion date.

The sale should move forward without issue if everyone is on the same page.

How To Deal With Gazundering?
Once you have completed the relevant property documents, the solicitors should start working on the contracts.

Check in regularly

Good estate agents and solicitors should provide updates on the sale’s progress (which is what you are paying them for).

Don’t hesitate to reach out if you need more information.

Consider purchasing residential abortive transaction insurance.

This policy won’t entirely remove the stress of a gazunder, but it will cover your legal and mortgage costs if it happens.

Be honest and don't hide anything.

If a buyer discovers any undisclosed issues with the property, don’t be surprised if the deal falls apart.

Even if you don’t know of any problems, the buyer may still request a discount — the decision of whether to continue or not is up to you.

How Long Do You Have To Report Problems After Buying a House?
Ask the quick house buying company for details on other sales they have made in the recent past.

Choosing the Right Fast House Sale Company

Several years ago, the Office of Fair Trading (OFT) was highly critical of fast house-buying firms.

They issued warnings that companies taking advantage of vendors in vulnerable positions could face serious consequences, including prosecution.

The practice of gazundering was a major focus of concern, and as a result, it is now less prevalent to hear of such practices in our industry.  However, we are aware that the problem still exists, albeit more discreetly.

A quick house sale company engaging in this kind of behaviour risks severe reputational damage and being barred from the governing bodies of our industry. In our opinion, it is simply bad business practice and not necessary. 

Check the Quick House Buyer’s Reviews

Make sure to look up reviews, social media profiles, and general online presence. A good starting point is LinkedIn, as well as Facebook and Twitter.

Ultimately, it’s your decision, but we’d usually suggest avoiding ‘one-man band’ property buyers.

Sell House Fast
The quick house sale firm you're dealing with should be able to provide up-to-date bank statements or a letter from their solicitor.

Fast House Buyer Track Record

Ask the quick house-buying company for details on other sales they have made in the recent past. Serious companies should be able to provide proof of the houses they have bought, such as completion statements from their solicitors.

Sell House Fast – Are you Dealing with a borrower or a cash buyer?

If you’re feeling dubious or even slightly concerned, request proof of the property buyer firm’s funds. This doesn’t necessarily prevent a price reduction at the last minute. Transparency is of utmost importance.

The quick house sale firm you’re dealing with should be able to provide up-to-date bank statements or a letter from their solicitor. They may be using a pre-arranged finance facility, in which case, they are not cash buyers and are reliant on a bridging loan!

Bridging loans requires additional hoops to jump through, including a valuation.  You should ensure there will be no delays and that the money is securely in place to purchase your house on the agreed date.

Sell to True Cash House Buyers

We will happily provide you with a bank statement, and our solicitor’s details and complete when we say we will.  

auction hammer

Property Saviour Price Promise

  • The price we’ll offer is the price that you will receive with no hidden deductions.
  • Be careful with ‘cash buyers’ who require a valuation needed for a mortgage or bridging loan.
  • These valuations or surveys result in delays and price reductions later on.
  • We are cash buyers.  There are no surveys.
  • We always provide proof of funds with every formal offer issued.

We'll Pay £1,500 Towards Your Legal Fees

  • No long exclusivity agreement to sign because we are the buyers.
  • You are welcome to use your own solicitor. 
  • If you don’t have one, we can ask our solicitors for recommendations.
  • We share our solicitor’s details and issue a Memorandum of Sale. 

Sell With Certainty & Speed

  • Our approach is transparent and ethical, which is why sellers trust us.
  • 100% Discretion guaranteed. 
  • If you have another buyer, you can put us in a contracts race to see who completes first.
  • Complete in 10 days or at a timescale that works for you.  You are in control.

Sell with certainty & speed

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