What Is a Gazunder?

Gazunder is a colloquial term used in the United Kingdom when a real estate buyer lowers their offer after agreeing to a higher price and just before signing the contract. Gazunders normally occur when conditions in the 澳洲幸运5官方开奖结果体彩网:housing market generally favor buyers over sellers. Although gazundering isn't illegal, many people consider it unethical as it o🙈ften forces sellers✅ to accept the lower price rather than holding their properties in a declining market.

Understanding Gazunders

The term gazunder is used in British financial markets—most commonly in the real estate industry. A gazunder is someone who makes and settles on an offer for a piece of property, then lowers that offer just before any contracts are signed. This is commo♏nly done when the real estate market is weak such that it favors buyers over sellers.

Gazundering can often lead to negative emotions. Despite this, it is a widely used strategy that buyers use when they want to 澳洲幸运5官方开奖结果体彩网:negotiate a lower price. Gazunder proponents take the position that while prices were rising, sellers were all too willing to accept higher offers from other buyers even after having agreed to a sale price.

Although it is deemed unethical and deceptive, there is no law against gazundering. This makes it completely legal. That's because neither party signs a contract when the buyer lowers their offer—even if both agreed to a higher price in the past. In fact, some people consider it to be a bullying tactic since it seems that the buyer tries to take advantage of the seller who may be desperate or under pressure to sell.

The ꧋seller has several options when they come across a gazunder:

• Agree to the gazunder's offer
• Negotiate it down
• Ignore the gazunder and risk the buyer walking away from the sale
  
• Walk away entirely

If the seller decides to nix the deal, they may have to start the process over again with a new buyer, perhaps waiting until the market moves in their favor. This can be risky, especially for sellers who want to unload their property in a hurry. Keeping the property for any length of time may result in higher 澳洲幸运5官方开奖结果体彩网:carrying costs. That's why gazundering can work—giving the buyer🌳 more leverage when the seller can't buy another property and is faced with additio🌜nal expenses.

Why Do People Gazunder?

The gazundering buyer generally makes their initial offer close to the seller's asking price. Then, as the contract signing day nears (the later the better, giving time for the seller to commit to buying their new property), the gazunder usually asks for a discount—5% to 20% is not unusual.

There are a number of reasons why people choose to participate ﷺin gazundering. For instance:

• Market conditions may give gazunders an advantage over sellers in the market.
• The buyer may change their mind about the price and may gazunder to dissuade the seller from accepting their offer.
• The buyer overestimates how much they can afford or qualify for a mortgage.
• A survey reveals that the property is worth less than the offer made.
• There may be lengthy delays that can leave buyers anxious.

Gazunders should ensure they have a backup plan in case the sellers walk away from a deal. They should also only use agents or solicitors who are paid only when the deal is completed. Gazunderers should also not let on to any party that they may attempt to gazunder.

Gazunder vs. Gazump

Gazumping is the opposite of gazundering. In gazumping, it's the seller who has the greater power in the relationship.

The seller raises the sale price of a property above the previously agreed-upon offer when the transaction is already well underway. As with gazundering, this ꦚis done before any contracts are signed. A seller may gazump if they think the buyer remains committed to the purchase even at a higher price or if they receive competing bids and can fall back on another offer if the first buyer walks away.

Gazundering and gazumping are not possible in the United States, since contracts formalizing a property's purchase price are signed at the beginning of the real estate transaction.

The Bottom Line

It isn't uncommon for buyers and sellers to negotiate with one another so they can get the best possible deal. In the United Kingdom, real estate buyers may go one step further by gazundering. This is the process of lowering their offer price after originally agreeing to a higher one. Although it may be considered deceptive, the practice isn't illegal since there is no contract in place. Sellers can protect themselves by working with professionals who have their best interests at heart, setting realistic prices, and being upfront about issues related to their property.