gazzumped??

trooperdog

HI all,

after having an offer accepeted, and paying for a valuation, i was shocked to hear the estate agent ring up asking if id like to up my offer as the vendor has been offered slight;ly higher????
apprently this is called gazzumping and is totally legal.
Im just wondering does this happen a lot, and where do i stand on getting my valuation fee back???

Yorkie1

Unusual for gazumping in this market but not impossible.

I don't think you can get the money back if the valuation has actually been carried out. It's one of the risks of the house buying process in England / Wales, that either party can change their mind without penalty up to the point of exchange. The valuation has been carried out and therefore the service has been performed.

trooperdog

thanks yorkie, it still sucks though ha!!

betmunch

Who arranged your mortgage?
One of the large national brokers opperates a Valuation Pledge which means you will be entitled to another valuation on a property of similar value.

Not getting your money back, but saving you the Val fee on the next house you try to buy. Better then nothing.

kingstreet

If the valuation hasn't yet been done, you can ask your lender to stop the appointment and preserve your fee until you sort out if you want a valuation of this property or another one.

If it has been done, sorry, the money is spent and there's nothing you can do.

Make sure your solicitor doesn't spend money on searches until you're sorted too.

Under the terms of the Estate Agency Act, any offer has to be communicated to the vendor, so the agent will have had no alternative but to tell the vendor of the new offer, leaving you in the lurch.

IMHO most agents work on a fixed fee and new offers put them in a position where they end up the bad guy when they would prefer to see the property sold to the person who has spent time and money and is making progress towards exchange.

A higher offer makes no difference to them in terms of what they get paid and their reputation will suffer as everyone blames the agent - not the law and not the vendor.

trooperdog

yeah im pretty miffed at the estate agents, would it not have been good practice to suspend viewings after i had the valuation or inform me that they had other viewings before i spent my cash?? does this happen often as im not looking forward to making an offer on another house??

kingstreet

The estate agent takes his instructions from the vendor who is paying the bill. As I said, most agents want to sell a property quickly and with the minimum of aggro and would love to not have to pass on later offers so this kind of thing couldn't happen.

As it stands, you can't stop it. All you can do is get to the point where you can exchange contracts as quickly as possible and hope the new offer isn't enough for the vendor to want to start from scratch.

Worth pointing out you have the freedom to pull out at any time before exchange and it's not always vendors who cause sales to fall through.

Hope you can limit your wasted expense by stopping valuation and searches though.

opinions4u

trooperdog wrote: »

yeah im pretty miffed at the estate agents, would it not have been good practice to suspend viewings after i had the valuation or inform me that they had other viewings before i spent my cash?? does this happen often as im not looking forward to making an offer on another house??

I've only ever sold a couple of properties myself.

On each occasion, after accepting offers subject to survey, I instructed the estate agent to leave the property on the market.

I'm glad I did. On both occasions the first buyer dropped out and a subsequent buyer was easily found. I didn't get any extra money offered, but I did achieve the sale.

It's legal, it's standard practice and in this market it makes a lot of sense for sellers to act in theis way.

Sorry if that's not what you wanted to hear.

molit

also, althgouh slightly unscrupulous, there are a couple of sellers, and estate agents who I have come across who rumour has it, had phantom higher offers put in to try to squeeze an extra few pounds out of the buyer...completely immoral, but very hard to prove