The property market is on the rise and competition is increasing fast – and not just in London. The downside of a buoyant market is that buyers are prepared to pay a premium to secure the right property in the right location, even if it means gazumping someone in the process by offering more than the accepted offer.
Buying a new home can be a stressful experience. After all the emotions of searching, viewing, checking, thinking and making an offer, through to having your offer accepted and starting to plan for new curtains and furnishings, it is distressing to be gazumped at the last hurdle.
The issue arises because it can take months from the point of having an offer accepted to being ready to exchange, and during this time you’re vulnerable as a buyer to others making a higher offer. Of course, the estate agent acts for the vendor, not the buyer, and has to pass on all offers to the vendor.
Although gazumping has returned together with the upturn in the housing market, there are steps you can take to minimise the risk of someone else offering a higher amount to the seller.
Even those in a strong position can be gazumped so make sure you take every precaution to avoid this happening to you.
1. Be Prepared
Before you even make your offer, have everything ready to go, including finance – a mortgage agreement in principle and this will help speed things along – to reduce the time period between having the offer accepted and exchanging contracts, which is when the vendor could change his mind or be tempted by a higher offer.
2. Find A Solicitor And Surveyor
It’s a good idea to have a conveyancing solicitor lined up before making an offer, and someone you trust and know is proactive will make a big difference too. By knowing which surveyor you’ll use you can instruct surveys to be undertaken that bit quicker.
3. Be Clear With The Estate Agent
Be clear and upfront with the estate agent so that they know you’re serious. State that your offer is conditional on the property being withdrawn from the market and a Sold (subject to contract) sign placed outside, as soon as the offer is accepted.
4. Arrange A Lockout Agreement
You could offer a non-refundable deposit to secure a lockout agreement, which is legally binding and provides protection for both parties. However, this can take a bit of time to draw up and you need to make sure an experienced conveyancer handles the details.
5. Be Chain Free
For a property in central London or another highly competitive area, you may want to consider being chain free when you make the offer. If you currently own a house, you could sell this first and move into rented property before starting the search for your new home. This will put you in a stronger position, enabling you to move faster and making you attractive to the vendor.
6. Exchange Quickly
Instruct your solicitor and surveyor immediately and do everything possible to speed up the process – as it’s only once you’ve exchanged that there’s no possibility of being gazumped.
An experienced conveyancing solicitor will work hard to minimise the risk of you being gazumped during the purchase process. If you want to find out more about our conveyancing services or for advice on buying your next home, email our residential conveyancing team on email@example.com
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