What Is Gazumping and How Can You Avoid It?

Buying a property is often one of the biggest and most emotional investments you’ll ever make. You find your dream home, make an offer, and breathe a sigh of relief when it’s accepted. But just as you begin picturing your furniture in the lounge, you receive devastating news — the seller has accepted a higher offer from someone else. This frustrating experience is called gazumping, and it’s more common than many realise. 

What Exactly Is Gazumping? 

Gazumping occurs when a seller verbally accepts an offer from one buyer, only to later accept a higher offer from another buyer before the exchange of contracts. Since offers in England and Wales are not legally binding until contracts are exchanged, sellers are free to change their minds during this period — and some do, especially if a better offer comes along. 

This can be incredibly disappointing and financially damaging for the initial buyer, especially if they’ve already spent money on surveys, solicitor fees, and mortgage arrangements. 

Why Does Gazumping Happen? 

There are several reasons why gazumping happens: 

• Higher Offer: The most common reason is that another buyer submits a higher bid, which the seller finds too tempting to ignore. 

• Slow Progress: If the buyer is slow in getting their mortgage approved or arranging a survey, the seller might get impatient and accept another offer to speed up the process. 

• Market Conditions: In a competitive housing market where demand outstrips supply, gazumping is more frequent because sellers have the upper hand. 

• Greed or Pressure: Sometimes, sellers are simply persuaded by estate agents or third parties to reconsider offers for better financial gain. 

Is Gazumping Legal? 

Yes, although it might feel morally unfair, gazumping is legal in England and Wales. Property transactions in these countries are not legally binding until both parties sign and exchange contracts, meaning either party can back out at any time before that point. 

In Scotland, the rules differ — offers are legally binding once accepted in writing, which makes gazumping less common north of the border. 

What Are the Consequences for Buyers? 

Gazumping can lead to more than just disappointment. It can also cost you hundreds or even thousands of pounds. Buyers typically invest in legal fees, mortgage applications, and surveys early in the process. If the sale falls through due to gazumping, that money is lost. 

There’s also the emotional toll to consider — buyers often form an emotional attachment to a property, and losing it at the last moment can be extremely disheartening. 

How Can You Protect Yourself from Gazumping? 

While you can’t completely eliminate the risk of gazumping, there are several steps you can take to reduce your chances: 

1. Move Quickly 

The faster you can move from offer to exchange, the less time there is for someone else to swoop in with a higher bid. Get your mortgage in principle sorted before house hunting, and instruct your solicitor early to act promptly once your offer is accepted. 

2. Get a Lock-Out Agreement 

Also known as an exclusivity agreement, this is a legal contract in which the seller agrees not to negotiate with other buyers for a set period. This gives you breathing room to complete necessary checks and move toward exchange without fear of gazumping. 

3. Build a Good Relationship with the Seller 

In some cases, a seller might be influenced by a personal connection or the certainty of a smooth transaction. Make sure to show that you’re a serious and reliable buyer. If you’re in a good position (e.g., chain-free or mortgage-ready), emphasise that too. 

4. Consider Home Buyer Protection Insurance 

Some insurance policies will reimburse you for costs like surveys and legal fees if the sale falls through due to gazumping. It’s not a perfect solution, but it can soften the financial blow. 

5. Choose the Right Estate Agent 

Working with reputable estate agents can also help minimise the risk. Experienced professionals often vet buyers thoroughly and work to keep sales moving efficiently. For instance, Bishop’s Stortford estate agents are known for their proactive approach, helping both buyers and sellers navigate transactions with confidence and speed. 

6. Be Transparent and Communicative 

Keep the lines of communication open with both your solicitor and the seller. Regular updates on your progress can assure the seller that the sale is moving forward and may prevent them from seeking other offers out of frustration or uncertainty. 

Can Sellers Avoid Gazumping Too? 

Absolutely. Some sellers are unaware of the stress and cost gazumping causes and may wish to avoid it out of fairness. By committing to an exclusivity agreement or simply honouring the first accepted offer, sellers can help foster trust and goodwill — which might even help the sale go through more smoothly. 

Conclusion 

Gazumping is one of the most unpleasant pitfalls of buying a home in England and Wales. While it’s legal, it can leave buyers feeling betrayed and out of pocket. Fortunately, by acting quickly, securing proper agreements, and choosing trustworthy professionals to work with, you can significantly reduce the risk. 

For both buyers and sellers, honesty, transparency, and speed are key. By understanding how gazumping works and taking proactive steps, you’ll be in a much stronger position to avoid disappointment and secure your next home with peace of mind.