Gazumping fears deter potential property buyers

A number of potential homebuyers are avoiding entering the property market due to fears of getting gazumped or gazundered, data from iamproperty suggests.

The survey of just over 1,000 aspirational homeowners conducted by the PropTech provider found that 14% of respondents listed the risk of being gazumped or gazundered as the top deterrent. This was closely followed by stamp duty and other tax implications (12%), and high mortgage rates (12%).

To help support aspirational homebuyers, more than three quarters of homeowners surveyed last year by Market Financial Solutions (MFS) believe that gazumping should be banned in England and Wales.

The specialist lender commissioned an independent survey of 1,183 people who had bought a property in England and Wales since 2014.

It found that 38% were gazumped by a rival bidder while trying to buy a property in the last decade – an increase of 7% since MFS last ran this survey in Q2 2022.

Four fifths (78%) of respondents are in favour of the government introducing laws to ban the practice of gazumping in England and Wales, as the Scottish government has done.

However, almost one in three (29%) homebuyers admitted to gazumping a rival buyer by coming in with a higher bid on a property for which another offer has already been accepted, and half (46%) would consider doing so in the future if it meant getting the property they wanted.

MFS’s research also found that three quarters (73%) of people believe gazumping and gazundering tactics have become more common place in recent years due to high demand and limited supply. A further 67% say that the property market is too competitive.

In addition, the survey revealed that 26% of homebuyers have gazundered a seller by lowering their offer late in the process.

Paresh Raja, CEO of MFS, said: “For all the challenges that both buyers and sellers have faced in recent years, there’s no escaping the fact that the property market remains incredibly competitive. Our research underlines one of the by-products of this, with buyers often having to resort to questionable tactics like gazumping to secure the property they want.”