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Is gazumping illegal?
You’ve made an offer on your dream home. The agent calls and confirms the seller’s acceptance. The nervous tension evaporates, and it’s time to celebrate. However, as some people discover, that call does not mean you are home and dry. Unfortunately, you remain exposed to the dreaded practice of gazumping until exchange of contacts. But is gazumping illegal?
What is gazumping?
Gazumping occurs when your seller accepts an offer from someone else on the property you are buying. Weeks or months into the process, you find yourself back at square one in your search for a new home. In addition to the disappointment and frustration, it is likely that considerable time and money have been wasted. With the shortage of properties on the market, gazumping is particularly prevalent.
In most cases, gazumping occurs because the new offer received is higher than yours. However, it may also happen if the seller believes you are taking too long and that the new buyer is better positioned to proceed quickly.
In 2019, Market Financial Solutions (MFS) published the results of research on gazumping. Here are their key findings.

A recent survey of 1,000 aspirational homeowners found that the risk of guzumping deterred 14% of them.
Gazumping and gazundering
Do not confuse gazumping and gazundering. Gazundering is where a buyer reduces their offer before exchange of contracts.
Is gazumping illegal?
While many believe it’s morally wrong, gazumping is not illegal. The agreement between you and your seller is not legally binding until exchange of contracts. That’s why estate agents use the term ‘Sold STC’ – subject to contract.
Buyers sometimes offer an inducement for the seller to agree to remove the listing. However, this only decreases the likelihood of another buyer becoming aware of the property; it does not prevent gazumping.
How to reduce the chance of being gazumped
Steps reducing the prospect of gazumping include:
- Be prepared to move quickly. Before making an offer, ensure that you have a mortgage agreement in principle and that you have instructed your solicitor. Once the conveyancing process is underway, respond promptly to all requests for information and documents.
- Ask the seller to remove the property listing. This is one of the best ways to prevent gazumping, although sellers are often reluctant unless you make it advantageous for them.
- Get to know your sellers and keep them regularly informed. A seller who sees that you are serious, that you love their property, and are doing everything possible to move the process along is less likely to abandon you in favour of someone else.
- Discuss a ‘lock out agreement’. This contract establishes that the buyer has the exclusive right to purchase for a specific period. There will be a modest cost associated with drafting the agreement. However, it may well appeal to a seller seeking reassurance that you are in a position to proceed swiftly.
Home Buyer’s Protection Insurance
Taking out Home Buyer’s Protection Insurance does not prevent gazumping. However, it does mean recouping at least some of your financial outlay if it does happen.
Will gazumping be banned?
A preferred solution centres on making the house purchase legally binding at an earlier stage, possibly immediately upon the acceptance of an offer. Withdrawing before exchange of contracts would result in covering the other party’s costs.
There have been calls in some quarters for a system akin to that which operates in Scotland. There, the deal is binding on exchange of missives (a series of contractual letters). This prevents both gazumping and gazundering. However, this system is not universally popular in Scotland. This is because the onus is upon the purchaser to conduct all necessary checks prior to making an offer.
Others are pushing a system similar to that in France, where there is a 10-day cooling-off period following the acceptance of an offer.
Estate Agents Gazumping Policy
While we all hope the estate agent will act honourably, it’s a sad fact that a minority encourage gazumping. If they work on a percentage basis, the higher the sale price, the greater their commission. However, remember that the seller is their client, not the buyer. Therefore, they must achieve the highest price and present all offers to the seller.