20^th May 2018

Gazundering, apparently a 'modern phenomenon', is causing major headaches for buy to let landlords wishing to sell up and of course homeowners as well.

A home owners' property advice organisation and a property investment forum jointly commissioned YouGov to produce a report on the reasons why the majority of 'residential' sales failed to happen. The study found that it was due to buyers changing their minds and in some cases trying to lower the price; each year sellers, in total, lose approximately £400 million.

A number of private rented landlords who took part in the survey said that they were seriously considering leaving the sector because of the 'Usual Suspects' i.e. stricter lending regime, interest mortgage tax relief being phased out etc. Selling a property in theory with the market as it is, should be relatively easy; however each year 300,000 sales have fallen through, which on average costs each seller £2,700 for their pains.

The research studied home sellers experiences of putting a property up for sale, with 20% of respondents saying they had a sale which had broken down and 15% on average lost £2,727.

69% of home sales that had collapsed did so because of various buyer related problems, including a change of mind on the property, which may have stopped sellers from putting their property back on the market. 8% of those who had experienced a home sale collapse stated it was because of gazundering, a last minute reduced offer from the buyer before the contracts are exchanged.

Chief executive of home owners' association, Paula Higgins, explained: ‘We often hear about would-be buyers losing their dream homes as a result of sellers accepting higher offers but less is said about sellers forking out thousands in wasted fees only for buyers to change their mind, leaving the seller back at square one. Gazundering and time wasting is a huge problem. The homeselling system is so unreliable it’s deterring homeowners from selling – adding to the ongoing housing shortage crisis as a lack of suitable homes is one of the barriers to people moving up the property ladder.’

Co-Founder of the investment property forum, Samantha Kempe, added: "The current system has created a fundamental power imbalance between the seller and the buyer, with the seller often at the buyer’s mercy during what is often the largest financial decision of their lives. Sellers should be able to proceed with the sale of their property knowing what price they will receive and feeling assured that the sale will go through."

Richard Merrick of PIMS, said:" Gazundering, a new buzz word, is just breaking an agreement on the house price at the last minute and this can be extremely risky.

"Gazundering is lovely word for reneging on an agreement before contracts are exchanged and is something which has been going on for centuries in one shape or another."

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