Almost a fifth of property sales now experience gazundering, according to figures from property firm Quick Move Now.
Gazundering – the attempted renegotiating of a lower property purchase price after a sale has been agreed – has become more common in recent years as the market contends with cautious buyers and difficult economic conditions.
According to Quick Move Now’s recent figures, 19% of property sales experienced an attempted renegotiation after a sale has been agreed.
The research revealed that in 6% of gazundering cases (1% of all property sales), the seller rejected the attempted renegotiation, causing the sale to fall through.
In 28% of cases (5% of all property sales), the seller rejected the attempted renegotiation, but the sale successfully completes at the originally agreed price.
In a further 56% of cases (11% of all property sales), the seller agreed to renegotiate and accepts the buyer’s requested reduction, leading to a successful sale.
Finally, 11% of gazundering cases (2% of all property sales) saw the seller reject the proposed new price, but both parties agreed on a smaller discount, allowing the sale to go through.
Danny Luke, managing director at Quick Move Now, said: “There are several reasons why we’re now seeing a higher likelihood of gazundering.
“In the current climate, buyers are more cautious. Higher interest rates and an end to lower Stamp Duty rates mean buying a property is more expensive.
“Buyers are therefore likely to intend to stay in their next property for longer.
“Buying property feels like a bigger investment and buyers are wary of making a costly mistake. We also need to consider the rising cost of building materials.
“People are less likely to be looking for a ‘doer-upper’ in the current market due to rising costs. If a property survey uncovers unexpected work needed, buyers are more likely to ask for a price reduction to cover the cost.”
He added: “Sellers may be shocked or disappointed to experience gazundering, but the reality is that under our current buying and selling process the buyer has very little information about a property’s condition at the point of making an offer.
“Under the current system, there is little that can be done to protect yourself from gazundering, other than making sure your property is well-maintained, and any potential issues are addressed before putting your property on the market.
“The rate of gazundering does, however, add fuel to the argument of moving closer towards the Scottish system and providing more information, including a property survey, at the point of marketing the property. It would then be easier to make offers legally binding earlier in the buying and selling process.”
