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Sarah was eagerly preparing to leave the terraced house that had become too small for her family, planning to move into a spacious four-bedroom property in the countryside. However, just one day before exchanging contracts, the buyers of her home suddenly reduced their agreed offer by £15,000. Reflecting on the experience, Sarah—whose real name has been changed—describes the moment as awful, explaining, “your heart just drops to your stomach.”
This situation is an example of gazundering, a relatively uncommon but increasingly common issue in the property market of England and Wales, as noted by the Conveyancing Association. The association is urging the government to accelerate reforms designed to address gazundering and other problems in the house buying and selling process, recommending that changes be implemented much sooner than the currently planned timeline of 2029.
For Sarah, her husband, and their two children, the process had been progressing smoothly. They intended to sell the three-bedroom terraced house they had renovated and buy a four-bedroom detached home owned by her parents in the countryside. But just before the contract exchange, her estate agent called with unsettling news: the buyers had reconsidered and now wanted to reduce their offer by £15,000 after further research on the area. Sarah explains the difficult position this placed them in, highlighting the financial uncertainty: accepting the reduced offer would mean a loss, while rejecting it would lead to additional costs. “We had already paid one set of legal fees but would have had to pay again if we needed a new buyer,” she says. “We’d also paid the removal fees already and would have to pay again if we cancelled the moving date.”
Gazundering refers to the tactic where a buyer decreases their agreed offer just before contracts are exchanged, pressuring the seller to accept a lower price or risk losing the sale altogether. This can also cause the collapse of a property chain, potentially jeopardizing the seller’s ability to purchase another home. This practice is possible in England and Wales because offers become legally binding only once contracts have been exchanged—a process that takes, on average, 120 days. Statistics show that one in three house sales falls through before this point. The Ministry for Housing, Communities and Local Government estimates that this leads to a loss of £400 million for sellers and £1.5 billion for the wider economy annually. Proposed government reforms aim to reduce the completion time by about four weeks, which could save the average first-time buyer around £650.
After discussing her options with her father and husband, Sarah decided to relist her house immediately. Surprisingly, the buyers returned the following day, eager to proceed at the originally agreed sale price. Sarah expresses her frustration with gazundering, stating, “It’s not just a business deal. It’s my children’s home and the fact that nothing’s been done about it is ridiculous.”
Beth Rudolf from the Conveyancing Association describes gazundering as a relatively small but growing issue. She explains that although it does not happen very frequently, the trend has increased due to shifts in the property market towards a buyers’ market. This change has resulted in more homes being available than there are buyers, creating intense competition among sellers who are then more inclined to reduce their prices.
The government has announced plans to overhaul the house buying and selling system in England and Wales to address problems like gazundering. However, the current schedule sets the reforms to be completed by the end of the present parliamentary session in 2029. The Ministry for Housing, Communities and Local Government has told the BBC that these reforms will include legally binding agreements designed to prevent buyers from pulling out at the last minute without valid reasons and will impose fines on those who do so
Read the full article from The BBC here: Read More
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