Gazumping Explained: What Home Buyers and Sellers Need to Know

For first-time buyers in the UK, having an offer accepted on a home is a huge milestone. But imagine this - you’re already planning where the sofa will go, only to find out that the seller has accepted a higher offer from someone else. Welcome to the frustrating world of gazumping.

Gazumping is a legal but controversial practice in England and Wales that can leave buyers scrambling and sellers weighing up their options. Here’s everything you need to know about gazumping, including how to protect yourself and whether it’s ever the right thing to do.

 

What is Gazumping?

Gazumping happens when a seller accepts a higher offer from another buyer, even after agreeing to sell to someone else. This can happen right up until contracts are exchanged, as nothing is legally binding before that point.

For buyers, it’s a gut-wrenching experience, especially if they’ve already spent money on surveys and legal fees. For sellers, it’s often about getting the best deal, but there are risks involved too.

 

Why Does Gazumping Happen?

Gazumping is more likely when the UK property market is competitive. Here’s why sellers may choose a higher offer from another buyer:

• They simply want more money - A new buyer comes in with a higher bid, and the seller takes it.

• They fear delays - If the original buyer is slow to arrange a mortgage or complete legal checks, another buyer might seem more reliable.

• The seller feels pressured by estate agents - Some agents encourage gazumping to increase their commission

• Cash buyers jump the queue - A buyer with cash and no chain is often more attractive than someone waiting on mortgage approval.

 

How Can Buyers Avoid Gazumping?

While you can’t completely prevent gazumping, you can reduce your risk by following these steps:

 

1. Get Mortgage Ready Before Making an Offer

Sellers prefer buyers who are financially prepared. Use Klink’s Mortgage Readiness feature to assess your financial position before making an offer. This strengthens your position and shows sellers you’re serious.

 

2. Move Quickly Once Your Offer is Accepted

• Instruct a solicitor immediately.

• Arrange surveys and mortgage valuation as soon as possible.

• Stay in regular contact with the seller’s estate agent to show you’re committed.

 

3. Ask for a ‘Lock-in’ or Reservation Agreement

Some sellers may agree to a contract where they commit to selling to you (often with a financial penalty if they back out). These are not yet common in the UK, but they can provide protection.

 

4. Be Ready to Negotiate

If you hear another buyer has made a higher offer, consider whether you can match or slightly increase your bid. If you can’t or don’t want to, it might be best to walk away.

 

5. Use Klink to Plan Ahead

By tracking your deposit savings with Klink’s Home Goal feature and keeping an eye on spending using Spending Insights, you can position yourself as a serious buyer ready to act fast.

 

Gazumping from a Seller’s Perspective: Is It Ever Justified?

Sellers want the best deal possible, and legally, they have the right to take a higher offer. However, there are ethical and practical risks involved:

• Delaying the sale - Switching buyers late in the process can slow things down.

• Risking the new buyer pulling out - Just because someone offers more doesn’t mean they won’t later drop their bid or struggle to get a mortgage.

• Damaging reputation - In smaller communities or professional networks, gazumping can burn bridges.

A seller who wants to act fairly can reduce the chance of gazumping by:

• Setting clear expectations with their estate agent to avoid accepting new offers once a deal is agreed.

• Choosing a buyer based on speed and reliability rather than just the highest offer.

• Being upfront about timelines and ensuring buyers know when they need to act.

 

Could Gazumping Be Banned?

There have been discussions about making property transactions legally binding earlier in the process to prevent gazumping. Some proposals include:

• Mandatory reservation agreements - where both parties commit financially to the sale.

• Scotland’s approach - where the legal contract is agreed earlier, reducing last-minute offer changes.

For now, though, gazumping remains legal, and buyers need to be proactive to protect themselves.

 

Final Thoughts

Gazumping can be devastating for buyers, but being financially prepared and acting quickly can reduce the risk. Sellers, meanwhile, need to weigh up the potential gains against the risks of delays and uncertainty.

Using Klink can help first-time buyers stay ahead by:

• Tracking savings with Home Goal

• Checking mortgage readiness to speed up approval

• Using Spending Insights to stay financially stable.

Download Klink today to strengthen your position in the property market and avoid setbacks like gazumping.