What is Gazundering?

Full Definition

Gazundering is the mirror image of gazumping: instead of a seller accepting a higher rival offer, a buyer who has already had an offer accepted deliberately reduces that offer, often shortly before contracts are due to be exchanged, when the seller (who may themselves be relying on the sale to fund their own onward purchase, and may have already incurred conveyancing and survey costs) is under the most pressure to avoid the transaction collapsing and having to start the sale process again. Because in England, Wales and Northern Ireland no party is legally committed to a sale until contracts are exchanged, a gazundering buyer faces no legal penalty for the tactic, even though it is widely regarded as an unfair or opportunistic negotiating strategy. Gazundering tends to become more common in falling or uncertain property markets, where a buyer can point to genuine evidence that comparable properties have since sold for less, as well as near the very end of a long or slow chain, where the seller has the most to lose from the deal falling through. Sellers have limited formal protection against it, though exchanging contracts as quickly as possible, keeping the chain as short as possible, and being willing to walk away from a clearly opportunistic reduction (rather than one reflecting a genuine change in survey findings or market conditions) are the main practical defences; as with gazumping, Scotland's system of binding offers and conclusion of missives makes gazundering much rarer north of the border.

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