Gazundering: What is it and what can I do to avoid it?

Key highlights:

• Gazundering is when your buyer slashes their offer on your home at very short notice, often knocking thousands off the asking price.
• Unfortunately, it's not illegal to gazunder someone before exchange of contracts, but it is considered unethical.
• After contracts are exchanged, the price of your home cannot be changed. And the buyer will lose their 10% deposit on your home if they pull out.

You’ve accepted the offer, are excited about moving - and maybe even started packing - but then, just as you’re exchanging contracts, your buyer suddenly drops their offer. Now what?

Well, you do have options. Gazundering may be frustrating, but unfortunately, it is a perfectly legal tactic that can cost you thousands. Here’s why it happens, and how you can protect yourself.

How common is gazundering?

Gazundering isn’t all that common, but if it’s a buyer's market, and the buyer has more options - and time - available to them, then it can happen. You’re also more likely to see it when you’re exchanging contracts, as some buyers hold until the last minute just to see if you’ll break.

Is gazundering legal?

While gazundering is legal in England and Wales, it is frowned upon and can really sour a transaction. In Scotland, it is also technically legal, but legal documents are signed earlier on in the process, so it reduces the opportunity for gazundering to happen.

If you are thinking of gazundering someone, just remember the estate agents will remember you, and it could come back to bite you when buying property in the future.

Why do buyers gazunder?

There’s a range of reasons why someone might try to pull the rug out from under the sale last minute. They may have spotted something in the survey or saw falling house prices in the area. Or, their financial situation might have changed, but they have their heart set on the house.

It can also just be the nature of the person, and they just see it as a cheeky negotiation tactic. The frustrating thing is that while it’s not exactly great behaviour, gazundering is perfectly legal in England and Wales. Until those contracts are exchanged, nothing is set in stone.

How to stop yourself from being gazundered

While you can’t just wave a magic wand and stop it from ever happening, there are plenty of things you can do to reduce the risk:

If your property is fairly priced, there is less reason for a buyer to try their luck later:

• Research what similar homes in your area are going for.
• Be upfront about any issues with the property and avoid upset later.
• Make sure your home is valued correctly with our free valuation.

There is no such thing as a good buyer - at the end of the day, a buyer is a buyer. But there are things to look out for which make them more likely to offer no complications down the line.

You should start by looking for a buyer who isn’t part of a chain. They’re not unicorns and are surprisingly more common than you’d think. First-time buyers are your best bet when it comes to chain-free properties.

Another green flag is people who’ve already had their mortgage approved. This means they have established how much they want to spend monthly and are less likely to change last minute.

The last one is the most obvious. Find someone who genuinely loves your property. If you find someone who has their heart set on moving in, then they’ll one as fast and smooth a process as possible.

Building a relationship with your buyer can work wonders.

You don’t have to message them every 20 minutes, but give regular updates whenever something happens so they stay in the know.

Also, make sure you discuss concerns early on, and don’t try to hide things like rising damp, which will later come up in a survey. A little honesty on your part will go a long way.

Finally, you should meet the buyer face-to-face. If they see it is a human they are talking to, they’ll be less likely to gazunder you.

4. Maintain a momentum:

The longer your sale drags on, the more tempting gazundering becomes.

Make sure to get all your paperwork signed early, respond quickly to any info requests and set clear expectations from the start.

It is not standard practice, but you can also request a 'lock-out agreement', which may give you a bit more security during the process.

What are my options if someone is gazundering me?

Don’t worry just yet. If you are being gazundered, you have options.

Start by standing firm. Tell them you are not in a rush and see if you can call their bluff. If that doesn’t work, then you can try to see if they will meet in the middle.

You should ask their reasoning behind the gazunder. If it’s down to things like survey findings or you can’t get planning permission, then you might have to be flexible on price.

Before all that happens, though, speak to your estate agent; we have seen it all before and can help you navigate the situation. And, remember, you don’t have to sell to them. Nothing has been signed yet, and you can always walk away from the sale if you’re not happy.

How do you minimise your risk of being gazundered?

While gazundering can be a real headache, being clued up and taking these steps can help protect you. Your best defence is choosing the right buyer, maintaining communication and keeping up the momentum.

Don't let last-minute price reductions derail your property sale. Our experienced team can help you navigate the selling process with confidence and minimise the risk of gazundering.

If you’re looking to sell, your first step is seeing what your property could go for at open market…