Many sellers are seeing offers slashed right before exchange (Picture: Getty)
The day before she was due to exchange contracts, the people buying Katharine Storr’s family home slashed their offer by £30,000.
‘They were bringing up all kinds of things which were in the survey, but weren’t issues at all,’ said the mum, 38, who lives in Tooting with her husband Matt and their kids.
‘They had us over a barrel and knew it as we have three children and were moving house for schools.’
Like many selling a property in the current market, Katharine had been gazundered – when a buyer reduces their offer at a late stage of negotiations to pressure the seller into accepting less money.
According to research by House Buyer Bureau, 31% of UK home sellers over the last six months have fallen victim to gazundering, with a third saying it happened within a week of their exchange date.
Moving house is already considered to be one of the most stressful events in our lives, so shifting the goalposts at the last minute puts even more strain on everyone involved.
‘We were so upset and angry,’ writer Katharine told Metro.co.uk. ‘It felt awful, everything had gone so smoothly until that point and then it felt like they were inventing issues that weren’t there to try to get money off.’
But the tactic worked for the buyer and, backed into a corner, they accepted £15,000 less than the original offer.
Katharine and her husband Matt were ‘upset and angry’ over the last-minute reduction (Picture: Katharine Storr)
Three quarters of sellers who’ve been gazundered reported that they also gave into the pressure and accepted, with reasons including believing the lower offer was still fair, not wanting to jeopardise their onward sale, and not wanting to waste more time finding another buyer.
This was the case for Evie Richards, 25, who was keen to sell the house she shared with her boyfriend after they broke up, so she could move on with her life.
The deputy SEO editor from South London and her ex put the property on the market in February but didn’t accept an offer until June.
‘The offer was already around £20,000 below asking,’ she explained. ‘But it was at the bottom end of what the house was valued at and we weren’t making a loss (breaking more-or-less even) so reluctantly agreed – knowing that this is just how the market is, and we both wanted out of our current situation.’
By September, they were ready to sign on the dotted line when Evie got a call from her solicitor while she was at work. The buyer claimed that unless they were willing to accept an offer £30,000 less than agreed, he’d ‘walk away’ completely.
There are no restrictions on gazundering in the UK (Picture: Getty Images)
She told Metro.co.uk: ‘My world shattered, and it took me a while to compose myself and get back to work. He said unfortunately this is common practice we’re seeing more and more, where buyers prey on desperation and time pressure and make ridiculous requests like this that you can’t afford to turn down.’
Evie was also informed that buyers sometimes put offers on multiple houses to try their luck and see what they can get cheapest – and there’s nothing preventing them from doing this.
After a lot of back and forth, they were able to negotiate the price to £7,000 less than originally offered, along with amenities such as the brand new fridge and garden furniture thrown in.
Yet Evie remembers the nerve-wracking ordeal as ‘a waste of time and money’ that left her ‘terrified that the buyer would pull out.’
Evie’s ‘world shattered’ when she heard the news (Picture: Evie Richards)
The current property market, where buyer demand is low, puts them in a position of strength and makes gazundering seem like a less risky option. Conversely, when the market favours the seller, gazumping becomes more frequent.
Analysis by GetAgent found that Google search popularity for the term gazundering has risen 97% since January, while property sales are down 17% compared to last year and have reached seasonal lows not seen since 2014.
These factors likely encouraged the buyer of Maria Bailey’s Torbay home – who she describes as ‘one of life’s chancers’ – to drop his initial offer by £60,000 late last year.
The 47-year-old director of community interest company Grief Specialists was all set to move to Somerset with her husband and three children when they heard the news.
She immediately declined and took another offer just under asking price, but the gazunderer later got back in touch, seemingly regretting his decision.
The economic downturn has created a buyer’s market (Picture: Getty Images/iStockphoto)
Maria told Metro.co.uk: ‘He put a letter in the post box offering us full asking price and said it was his dream home, and he’d even wondered if the estate agent had passed on his offer.
‘I told the estate agent to tell him I wasn’t interested, but he then sent another letter to offer £15,000 over asking and told me he was a cash buyer.’
As the other buyer seemed to be having second thoughts, Maria contacted the man and said they’d accept close to the asking price but ‘he wasn’t to mess [them] around.’
‘He shook on it, and said it would get sorted very quickly,’ recalled Maria. ‘What he didn’t tell us was that he was reliant on a bridging loan and his brother lending him some money, as he had other property to sell.’
Maria was backed into a corner as her family were all ready to move on (Picture: Cheryl Small Photography)
What was supposed to be a ‘fast sale’ went on until the end of March this year, and pressure was mounting as school places had been secured for the kids. Then, after all the hassle he’d already put them through, the buyer called two days before exchange to say there was an issue with the solicitor’s stamp duty calculation which meant he’d be reducing his offer by £20,000.
‘He knew exactly what he was doing,’ commented Maria.
She tried to negotiate money off the home she was buying, but the vendor was in hospital and his daughter – who had power of attorney – refused.
Maria said: ‘By this stage, we just wanted to move and we were fed up after six months of chasing and waiting. It was the most stressful and frustrating time.’
Although she accepted the lower offer to put the issue to bed, she says it was ‘horrendous’ – especially as, if the buyer sells his other property within 12 months, he’s eligible to claim back the surplus stamp duty he paid and effectively gain from Maria’s loss.
‘I felt like I’d had money stolen from me,’ she added. ‘I’d hate for anyone else to go through this.’
The process adds even more stress to the process of moving home (Picture: Getty Images)
All three of the women we spoke to called for regulation to curb the practice of gazundering. At the moment, however, no such regulation exists.
Managing director of House uyer Bureau, Chris Hodgkinson, told Metro.co.uk: ‘As a seller, there’s really nothing you can do other than to accept the lower offer, or pull out of the sale completely.
‘In the current market where securing a buyer is a task in itself, having to start from scratch is far from ideal, costing you both time and money. The best approach, while frustrating, is to re-negotiate and try to meet in the middle.
‘While this means you will still secure less for your home, it means you can reduce the hit you take on price without losing your buyer.’
It all depends on your situation and whether you can either afford to take a hit on the price or stay in your current home until something better comes along. It’s a game of chance that could go in your favour or see you lose out.
If you’re a buyer, the prospect of getting a better deal may seem tempting, but this also comes with a level of risk.
‘Ultimately it can mean you lose out on the house you wanted for the sake of a few thousand pounds and you may regret this decision further down the line,’ said Chris.
‘It is essentially unnecessary unless your mortgage offer has changed and you’re left with no other choice.Â
‘And if this isn’t the case and you’re simply being greedy, it’s likely to leave a very sour taste in the mouth of your seller, which isn’t ideal when it comes to the rest of the process.’
When it comes to managing the heightened emotions of being gazundered, Evie advised: ‘You just have to look past the panic and keep a cool head.’
The trick plays on your sense of urgency and exhaustion over the long drawn-out process, so try to deal in facts over feelings and seek guidance from your solicitor or estate agent.
By all means feel free to get angry and shed some tears – just make sure you put on your best poker face when dealing with your opportunistic buyer.
‘It was the most stressful and frustrating time.’Â
