What is Gazumping? How It Happens and How to Protect Yourself

What is Gazumping?

Gazumping occurs when a seller accepts a higher offer from a new buyer after having already accepted your offer — leaving you out of pocket for survey and legal costs already incurred. It is entirely **legal in England and Wales** because no binding contract exists until exchange of contracts.

In a competitive or rising market, gazumping becomes more common as sellers become aware that their property may be worth more than the price they agreed.

What is Gazundering?

The reverse also exists: **gazundering** is when a buyer reduces their offer at the last minute, shortly before exchange, knowing the seller has few options and has invested time and money in progressing the sale. While also legal, it damages trust and is generally considered poor practice.

Why Gazumping Is Legal

In England and Wales, the sale of a property is not legally binding until **exchange of contracts**. Prior to this point, an accepted offer is a gentleman’s agreement only. Either party can withdraw without legal liability (though you may lose survey and legal fees already paid).

Scotland operates differently: once **missives** (the Scottish equivalent of contracts) are concluded, the sale is legally binding at an earlier stage, making gazumping effectively impossible in the Scottish system.

How to Protect Yourself

Move Fast

The best protection is speed. Instruct your solicitor, submit your mortgage application, and book your survey on the same day your offer is accepted. The faster you get to exchange, the smaller the window for gazumping.

Ask the Seller to Take the Property Off the Market

Once your offer is accepted, ask the estate agent to mark the property as sold subject to contract (SSTC). Most sellers will agree. While this does not prevent gazumping, it reduces the chance of competing offers emerging.

Lock-Out Agreement (Exclusivity Agreement)

A lock-out agreement is a legal contract in which the seller agrees not to accept or consider other offers for a defined period — typically 28 days. It costs approximately £500–£1,000 in additional legal fees for both parties to draft and execute, but provides genuine protection during the critical early weeks.

Buyer Protection Insurance

Policies typically costing £50–£150 will reimburse your survey costs, legal fees, and mortgage arrangement fees if the sale falls through — for any reason, including gazumping. This does not prevent gazumping but limits your financial exposure.

Reservation Agreements

Some new-build developers and a growing number of sellers offer reservation agreements — a fee (typically £1,000) paid by the buyer, which is forfeited if the buyer pulls out without good reason, and matched by the seller if they pull out. These are not yet standard in the resale market but are becoming more common.

If You Are Gazumped

If you are gazumped, you have limited legal recourse. Your options are:

1. **Increase your offer** if you are able and willing to do so

2. **Walk away** and recover what costs you can through any buyer protection insurance

3. **Wait** — the new deal may fall through, in which case the seller’s agent may come back to you

Property Passport UK helps buyers and sellers document the progression of a sale, maintaining a clear audit trail of agreed terms and milestones.