If you’ve had an offer accepted recently - are you tempted to gazunder?

[Amtheyest17]

Hello,

If you’ve had an offer accepted recently - have you or are you tempted to gazunder because of market conditions?

With the volatility in the market and house prices coming down. Obviously there is a concern that you could be overpaying for something

Anyone planning to or tempted? I know it’s a shitty thing to do. Not saying we will but we keep coming up against hurdles because of the market and we are starting to consider changing our offer as market conditions are really squeezing us now.

Not moving but DS is upsizing and the answer is a big fat no. Like you say it's a shitty thing to do and you aren't being clever because the whole chain could collapse or everyone in it will have to do the same.

Only a FTB would benefit and quite frankly unless you were desperate for that FTB I would sell to someone else.

Of course it's subjective anyway, house prices haven't come down round here in my part of the north. A few ambitiously priced houses are sticking around and may indeed have to drop but most houses in good condition in decent parts are still selling straight away.

There's no general answer to this. If it's a once in many lifetimes type home, the fair ppsm will tend to be higher, and may well match the 100-200% bubble that's grown over the last 15 years. Even that sort of home will have its ceiling. The trouble is other sellers with totally different run-of-the-mill homes then fall for the agent's promises and find they get few views and no offers.

If I were to sell in any market I'd pitch the asking price low, because that will start a bidding competition and achieve better than starting high, however most sellers can't or won't see that and agents find that stroking egos rather than selling for the highest price is what sellers want. Agents have to make a living and sellers have only themselves to blame.

Check past sold prices and gauge where a fair price will be now, taking into account how rare or usual yours is. Then discuss it with the seller, but only if you're prepared to walk away. This is very easy to do for easily replaceable homes that are perfectly good but not unique and rare.

Depends what you mean by "gazunder".

If you mean waiting deliberately until the minute before exchange that is an aggressive tactic. It's not illegal, but I wouldn't expect your sellers to be doing you any favours in the future if you do it. I personally wouldn't.

OTOH The time between offer and exchange is often long and market conditions are varying rapidly at the moment. Things can become apparent during that period (eg survey) that can lower the value, as can knowledge of other transactions that take place and mortgage rates. So yes I would lower my offer during that time period if the transaction became of less value to me during that period. But I would generally do it as soon as I had the information and the feeling that I wanted to lower the offer and not wait until 2 minutes to midnight to try to deliberately pile on the pressure.

Ultimately no, but i wish I could. We offered on our forever home in January. The vendors have messed us around and we aren’t likely to complete until September. I’m certain it’s dropped in value by at least 5% since then. We actually haven’t sold ours yet so I feel like we are paying tip of the market but will sell at the bottom so worst of both worlds.

*Gazump

Not a chance. And if you're writing this for a rag I'm not interested in being quoted.

No. If I were that worried I'd rather stepped out not stopped the buying process altogether and waited for the market to stabilise.

not=and!

See in these circumstances I think it's fine.

Deffo would not do it at the last minute as a tactic!! Considering it currently a week after offer was accepted due to mortgage issues because of the rates & also we’re dealing with a horrible EA on the sellers side who basically pushed our offer up. I also think I might just be having a bit of a wobble because it’s such a big purchase & our first house we made some really bad financial decisions. Wouldn’t want to do it again!! I.E buy something that’s overpriced.

If you decide to lower your offer it should be because you absolutely are no longer willing or able to pay the original accepted offer and would be prepared to lose the property if the sellers say no. That could be because of survey results or decreased affordability due to interest rate rises.
If it’s only a week since your offer was accepted then it’s likely neither side has incurred costs yet so if you are serious then have that conversation now and not further down the line but be prepared to walk away if they refuse.
I’ve recently exchanged on a property and the market definitely dipped since my offer but did not consider gazundering. The survey was fine, the property still perfect for us and we intend to stay there a long time.

No. If my buyer haggled me down I would have to ask my seller to drop too to reflect this so it evens out (I am buying an empty property from a developer). If my seller said no then the chain would collapse because I could not afford my forwarding purchase. SSTC early April without reduction and my buyer has not made any noises about reducing so we shall see.

No because then we’d have to redo our mortgage offer so wouldn’t save!

No I wouldn't suddenly reduce the price for no apparent reason. But I would be tempted to reduce it if the survey found anything negative. And let's be honest, surveys always find something negative.

If my buyers would attempt to gazunder me 2 days before the exchange, I will put the house back on the market. Maybe even for the price they have tried to haggle down. But I would not be selling it to them. You mess with me - you look for another house and new mortgage deal, cheerio.

The 2010's say hello.

We're considering it given our offer was accepted 4 months ago, they advertised as chain free but have actually been looking at places to buy with the estate agents that advertised as chain free. We made an offer based on a quick hassle free sale so the house is already worth less to us let alone to others, we should be in that house already and would never have offered on it if we'd known we'd be strung along like this. We aren't that fussed if we lose out.

It’s a horrible tactic…. But I think it depends show you view the market and whether the protracted length of purchase in the Uk, and decades of gazumping which you might have suffered from, is what it is.

Generally I wouldn’t try and stitch someone up…. I’d make what I’d feel is a reasonable offer, and stick to it - unless they tried to play silly buggers.

However, the new base rate of interest, 5% is the new normal, it’s here to stay, it won’t move much in 2 years, it will go up to 6, at best it should go back down to 4 or 4.5%. Most people think base rates should be at 1 or 2%, but this is an artificial level which should never have been allowed to continue for as long as it did. The result, is this rebalancing, a recession, a jobs recession, and savers now making decent money on their cash and of course, house prices are going to fall another 20%. Not thisbyear, next. They’ve tried to deflect this by bumping the issue over to labour who will get in around May 2025, which is when the 12 month repos will start to kick in. Nice stitch up. I’m a Tory and I see the nastiness in this.

so yeah, I’d be looking at a 20% discount on Oiro prices right now, and more in 6 months. And if I was in a deal now, I’d be walking away, as few have woken up to this little game that’s being played with our lives.

If you can barely afford it now, and I am gonna assume you have a small deposit, you cannot afford the negative equity that will be coming down the line for most FTBs who are stretching themselves in a few year's time. If they knock 10, 20k off asking for you, it's a drop in the ocean to a 20% house price fall that may see you forced onto your lender's SVR (the average of which is currently around 8.5%).

Just don't do it, walk away, look for a cheaper house, or wait a few years until prices have dropped.

My advice only changes if you are taking out a 10 year fixed rate. Even 5 years probably won't be long enough to cover it for FTBs in the economy we have coming.

No, that means something different. Gazumping is when another buyer comes in after your offer has been accepted and offers more than you and you lose the house.

Gazunder is when the buyer asks for money off, which is usually done so close to exchange that many vendors feel they have no choice but to accept. For some people, gazundering is a strategy, albeit a really shitty one when left to the last minute with no justification.

I don't think it's sh1tty, it's business and thems the breaks, why would you pay any more than you have to for anything🤷

Someone just did this to my mum.
The man of the couple buying her house knocked on the door, gave her a (probably true) sob story about their mortgage offer having been downgraded, and asked her to drop her price.
She's 70 and lives alone so found this very unsettling. Thankfully she knew to say that she will only discuss the price via the solicitor.
The sale has now fallen through.

That's an attitude that can work in a different market. Not the one we find ourselves in today where to turn down a buyer could be a very big mistake.

Selling a house needs to be a business transaction (buying is often more emotional but selling needs to be business like).

Why did it fall through?