Picture the scene: you’ve found the house you love, you’ve made an offer and it’s been accepted. It’s a done deal  – or is it?

As an agent, one of the worst calls I ever have to make is the one that tells a buyer that he or she has been gazumped. That is, that someone else has made a higher offer in the meantime and the seller has decided to go with that one instead.

Gazumping can take place at any time between a property going under offer and exchange of contract. The practice became well known during the 1980s and 90s and usually only occurs in a strong market when competition for property is fierce. 

Ultimately the decision lies with the seller and presents a real moral dilemma. Do they honour the original agreement or take the extra money? It’s certainly not a straightforward choice. Just as a buyer is entitled to withdraw at any time prior to exchange, so sellers have the right to change their minds too. But doing so can be risky – if the new buyer pulls out, the gazumped under-bidder is unlikely to renew their offer.

For obvious reasons gazumping is very frustrating for a buyer but it can also leave sellers with an uneasy feeling about whether or not they have made the right choice.

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