Gazundering is a buyer’s strategy to force a seller into accepting a lower offer days before the sale completes. It’s not illegal, but it is unethical and a huge frustration for sellers.
Imagine this: You accept an offer on your property, get a mortgage agreed in principle for a new home, put a deposit down, then you’re backed into a corner to accept an offer £10,000 below your initial offer, or let the deal fall through.
This late into the property exchange process, surveyor fees have been paid, legal fees due, and administrative costs to arrange finance are already paid, or billable.
Gazundering is expensive and it can feel like a bullying tactic because obviously, you don’t want to lose money selling your home. Yet, no matter whether you sell for less or lose the sale, it’s going to cost you.
Here’s our top tips to avoid being gazundered.
1. Transparency prevails
Your property will be surveyed prior to the exchange of contracts. If you know there are issues going to be raised by a property surveyor, let potential buyers know.
A buyer lowering their offer after finding out there’s a higher expense to have your property repaired is reasonable and not gazundering. Unless they intentionally overestimate the cost of repair work.
2. Prioritise buyers with a mortgage agreed in principle
Buyers who have already spoken to lenders, decided on a good mortgage provider and have an agreement or decision in principle approved are less likely to be forced to lower their offer because they can’t secure the mortgage they’d need.
3. If you have the option, choose the chain-free buyer
A chain-free buyer is someone who is not reliant on their property selling to raise the cash to pay you. With a chain-free buyer, there’s less surveys that can come back undervalued, less people involved who could change their minds, and generally less things that can go wrong. Examples of chain-free buyers are first time buyers and property investors.
4. Ask a reasonable price (with offers over)
Your asking price is determined by your current property valuation and the market conditions. Do your research to find out what similar properties in your area sold for to give you a ballpark figure. Pricing too high can be inviting buyers to bring their initial offer down later. Although not always intending to gazunder the process, the results have the same impact.
5. Know your lowest offer
If you’re relying on the sale of your property to buy a new home, calculate your lowest possible selling figure. If your buyer does try to lower their offer days before completion, you’ll be able to decide if you want to accept the offer or stand your moral high ground and let the sale fall through.
To sum up selling with less risk of being gazundered...
- Give serious consideration to buyers who have a mortgage agreed in principle.
- Be honest about any issues that could cause a buyer to lower their initial offer after a survey is done.
- If you have a lot of interest, consider selling to a chain-free buyer.
- Make your asking price reasonable and not too high
- Know your lowest possible selling figure before listing and don’t go lower.
Keep the above points in mind to avoid your sale being gazundered. If you’re considering selling and want additional help and advice, call us on 01925 499599, or drop by our office for a chat.
