We got gazundered selling, can we get other bidder to gazump them privately?

RockabillyMum

We put our house on the market in the summer, had 20 viewings in a week. The estate agents didn't seem to do a good job during the viewings themselves as they had no bidders, but on the day I showed people round I got 3 offers. All were at our asking price or above. The estate agents then engaged all 3 bidders in a bidding war (which we didn't know about until afterwards) to get them all to go higher. 2 bidders offered us £5K more than our asking price, which was wonderful.

Estate agent told us to go with the pair who were cash buyers as they would make a quick sale etc so we accepted their offer. They had a survey after 6 weeks (quite why it took them so long I don't know), and 95% of what came up in the survey we already knew and I'd already told them at the viewing e.g. 100 yr old house, no lining to the roof but it's been fine for 100 yrs and no houses on our street have one, 1 window isn't double-glazed etc. Most of it said 'in 5-10 years you MAY need to look into getting this done' etc. The value of the work needing doing was less than a few hundred and none of it needed doing within the next few years.

The surveyor's report stated our house was not worth what they'd offered for it and said it was worth a maximum of £15K less. Despite the surveyor telling me he used 'software' to work out the value, and despite our house being the lowest priced on the market (others exactly the same are still on the market for 30 grand more, so we knew the pricing was right).

Rightmove and Zoopla value our house at 30 grand more, it has no structural defects, only needs the kitchen and bathroom modernising (they aren't very old and have nothing wrong with them at all, but we were honest with people when showing them round that we knew people would probably want to update them, we would have if we'd had any money while we lived here).

However, the cash buyers then dropped their offer by 15K. By this stage (2 months on) we had found a house to buy (only thing we can afford as it's in a state and needs doing up) but we need the full asking price to get it. The estate agent told the vendor of the house we are buying (weeks after our offer had been accepted) that we had lost our buyers, a day BEFORE they told us.

The vendor then instructed the agent to put his house back on the market. When we found all this out the next day, we were furious. Not only had we not LOST the buyers, only lost some of the price, but also we had been told AFTER the vendor of the house next up in the chain. When we complained that this was breach of confidentiality and that the estate agents have a duty of care to us as sellers, the agents said they also had a duty of care to the vendor of the house we want.

In the end, we had 2 hours to decide to 'absorb' the reduction in £15K, or face losing the only house we can afford to buy (and seriously, in 6 months looking there is nothing else out there for the price). We have children so need more bedrooms and can't stay all sharing just two. We asked estate agent to ask the buyers to not drop all £15K when there was not even £5K of work needing doing, but the cash buyers refused to negotiate beyond the value the surveyor gave them.

After this, I asked the estate agent why they didn't contact the other bidders who were interested originally, to see if they still wanted to buy our house, as they may have given us back some of the lost 15K. The agent told us they had called them both and emailed them but with no luck.

I googled both bidders and got in contact with them. One told us she was upset as she still wanted to buy our house but had just paid the day before for a survey on a new property (so had the agents actually called her a week before like they said they had she would have agreed to buy our house).
The other bidder also confirmed he had had no phone calls or emails from the agent, and was still interested. I arranged a private viewing for him (not involving the estate agent as obviously we can't trust them) and he offered us less than he had before. I negotiated with him, and now he has offered us several thousand more than the cash buyers (near our original asking price).

Am I right in thinking that we can't sell to him privately (and avoid estate agent fees) as he was originally introduced to us by the agent?

And if he bid now through the agent, are we allowed to accept his offer, which would gazump the horrid gazundering cash buyers?
We obviously would have to take a big risk, that his mortgage offer comes through, and that his survey doesn't value the house at a lower price. But we know from other house sales recently nearby, that our house could now be worth at least 35K more than we are selling for.

What is our legal position here?

[Deleted User]

Personally, I'd cut the estate agents and either get someone else or sell privately (as you seem totally able to do this). As you had so much interest so quickly after putting your house on the market, hopefully the same thing will happen again.

Much as you feel the house you want to buy is the only thing on the market, I doubt this is true. If you found one, you will find others. If house prices have risen since you put it on the market, won't this increase what you can look at?

I don't know what is going on with your estate agents.., it sounds like complete madness.., they obviously aren't into earning a commission or the highest possible commission lol. Change them/drop them as I said and start again.

bris

Yes you can, whilst I don't blame the original buyers for offering less because of the survey the fact is all bets are off. You can tell the original buyers there offer is not acceptable and you have a better offer, This will call their bluff with you knowing their is a better offer on the table.


The original buyers were also throwing offers at you over the asking price, this should have been an indication to them that they would have to pay more than survey to get the property, they are wrong to drop as much as 15k, but that's one persons opinion.


The fact you have a bidding war in the first week tells me it's a sought after property, don't sell it cheap, you can always string out your new purchase.

Davesnave

If you haven't exchanged, your legal position is that you can sell to who you like, so long as the agents, who introduced both potential buyers, get their fee.

The difficulty, as you understand, is that the first buyers' surveyor did not value your house at the agreed sale price and this might happen again, causing your buyer to reconsider their bid.

This would not be gazundering as the term is generally used, so your title is a little misleading.

RockabillyMum

@Davesnave, sorry, I had never heard of gazundering before, I was told this was what had happened to us by our solicitor as we were about to exchange when the cash buyers axed 15K off the agreed sale price, for no reason. We even asked them if the survey had flagged up work that needed doing now, we offered to pay for any work needing doing, but the truth is (and we have seen the whole surveyor's report, yet another reason the estate agent is breaching confidentiality all over the place) and it literally says house has lovely period features, house may need some work in 5-10yrs in places (such as the one single-glazed window) and yet it values it at a very low price, despite the surveyor not knowing a thing about the local area/local market.

I personally think the surveyor must be a friend of the cash buyers as I can't see how he can value our house so low when there is literally nothing on the market at that price.

I could understand them reducing their offer if there was a problem with the house, or structural issues etc. But when they looked round I told them the kitchen and bathroom were a bit dated but fine, they saw them both and were fully informed. Besides which, if we bought a house the value isn't dependent on the colour of the bath etc, it's about the value of the bricks and mortar, the area, the period features etc. Whether a buyer chooses to install a new kitchen and bathroom to their taste is up to them, but it's not worth 15K off the value of a house!

If we had agreed a sale price, and the buyers have dropped 15K off their offer right before exchange for no reason, then that to me is gazundering. Dropping the price right near the end for no reason other than knowing the vendor (us) wants a quick sale to buy the next house and therefore that they're dropping us in it... Personally I'm fuming with them, they went into the sale with their eyes open, and they have literally millions in cash free to throw around, whereas we've had 3 redundancies between us in 5 years and are struggling to pay our bills. It makes me sick that gazundering is allowed, and that we can't put our house back on the market without losing the house we are buying having spent a lot of money on searches, surveys etc.

stator

Given your serious complaints about the estate agents behaviour you could always offer to sever your relationship with them and drop all complaints. They forgo their fee, you drop all complaints.

bris

There was a reason, the surveyor gave them the reason.


Make no mistake about it the kitchen, bathroom etc, do make a difference to valuation, if they need updated then this will survey less than your next door neighbour who's house is fully modernised.


Whilst my original post still stands you are being a bit naive to the situation, your value came in low, another valuer from another lender may be different, but right now the value on the table is whats working against you, not the buyers.

Ozzuk

I wouldn't pay any heed to rightmove and zoopla prices - plus you say similar houses are 30k more - but they are still for sale. Its very possible if they do get offers any survey could be low like yours. Seems to be very common from surveyors at the moment and has cost me a lot of money.

I'd probably go with the new offer, but I think as the agent introduced them you are bound to paying them.

nubbins

Hi,

Personally I would tell the buyers to get lost and either stick to the original agreement or go elsewhere but in doing that be prepared to lose the house you are buying. In terms of selling to one of the other potential buyers, maybe you could offer to pay for the survey if she was definately interested. You will probably find in the estate agents contract something along the lines of anyone they introduced you will still be liable for their fees. My contract said for 6 months even if I found my own buyers privately then I would still be liable for their fees, after 6 months I could find my own buyers privately without any come back and after 12 months I could sell to one of their potential buyers that they introduced. I went into the estate agents and got a list of all the people they had introduced and a young whipper snapper estate agents printed off all their names, email address, telephone numbers and maximum price they would go to !!!:T

franklee

RockabillyMum wrote: »

The surveyor's report stated our house was not worth what they'd offered for it and said it was worth a maximum of £15K less. Despite the surveyor telling me he used 'software' to work out the value, and despite our house being the lowest priced on the market (others exactly the same are still on the market for 30 grand more, so we knew the pricing was right).

The asking price of the other houses isn't relevant as they are still on the market. If they were priced right surely they would have sold by now.

RockabillyMum wrote: »

I googled both bidders and got in contact with them. One told us she was upset as she still wanted to buy our house but had just paid the day before for a survey on a new property (so had the agents actually called her a week before like they said they had she would have agreed to buy our house).

Offer to reimburse the survey money if she buys your house?

RockabillyMum wrote: »

The other bidder also confirmed he had had no phone calls or emails from the agent, and was still interested. I arranged a private viewing for him (not involving the estate agent as obviously we can't trust them) and he offered us less than he had before. I negotiated with him, and now he has offered us several thousand more than the cash buyers (near our original asking price).

Ask for proof of funding or mortgage offer.

RockabillyMum wrote: »

Am I right in thinking that we can't sell to him privately (and avoid estate agent fees) as he was originally introduced to us by the agent?

No obligation to involve the estate agent but given they introduced they buyer you will still have to pay then their fee. You could try negotiating I suppose but they'd have no reason to drop the price.

RockabillyMum wrote: »

And if he bid now through the agent, are we allowed to accept his offer, which would gazump the horrid gazundering cash buyers?

Until you have exchanged contracts you can change your mind as you wish so can switch buyers. However I wouldnt pay above the survey value in your case.

rpc

The increase in selling price would more than pay the EA fee. So I would go with your other buyer whatever. The risk, of course, is that his survey puts the same lower valuation on the property. Perhaps you could try to get his survey done before pulling out of the other sale (maybe even offering to pay it).

I would be inclined to go with the suggestion above that you highlight major grievances with the agent and suggest that the contract is voided in exchange for no complaints or claims from you. It may not work, but worth a go...