Gazumping on rise in Lothian house market

Property experts say the practice is on the increase as sellers take advantage of desperate buyers willing to pay over the odds for properties.

Gazumping - where a vendor pulls out of an agreed deal with a buyer because they have received a higher offer from a third party - is not illegal but was once unheard of in the Scottish property market.

In a recent case, a family had an offer accepted for a fixed-price property in Linlithgow, only to be told a day later they had been gazumped by a higher offer.

Dominic Wedderburn, a residential estate agent with FPD Savills, said it was "devastating news" for the family.

"My heart really does go out to them," he said. "It’s unfortunate, but our system is becoming more and more anglicised and I think as we deal with an increase in English clients we are likely to see more cases of gazumping."

Gazumping is commonplace in England. In the worst cases, families have been left homeless by sellers who have pulled out of a deal at the last minute.

David Alves, managing director of Stewart Saunders estate agents, said the concept was "deplorable". "We have a system where most buyers and sellers in Scotland are morally beyond reproach, but it is confounded by the actions of a minority who play the system. Our system is infinitely superior to the English one because it is based on the concept of trust," he said.

"We have to be extraordinarily vigilant and stop this increasingly common practice, because if trust breaks down then the system is broken."

Many Scots housebuyers believe that once an offer has been verbally accepted the property is theirs.

But the Law Society of Scotland said that a contract is only binding when the missives have been signed.

A spokeswoman said: "Nothing is binding until everything is signed and either party can pull out at any time, but it is something we would not encourage."

Ian Williams, 34, and Susan Gardener, 37, had an offer for a fixed-price 360,000 property in Kettil’stoun Grove, Linlithgow, accepted on Thursday afternoon.

They were then informed by their solicitor yesterday morning that they had been gazumped by a buyer with a higher offer. Ms Gardener said the experience left her "absolutely livid".

"Because it was a fixed-price property we were over the moon when our offer was accepted the very same day that we placed a bid. It was heartbreaking to be told yesterday that we had been gazumped," she said.

Willie Hunter, a partner with Hunters PSM in Morningside, said solicitors were required to tell sellers of all offers, even if they came in after the closing date.

He said: "If an offer came in for a property which was 10,000 more than what was already verbally agreed, the solicitor would withdraw from the process, which helps discourage gazumping, but people are only human and the temptation will be there to take that extra money. We are moving closer and closer to the English system, but we do not encourage this kind of practice."

Leslie Deans, of Leslie Deans and Co. Solicitors, said the instance was "very naughty". He said: "Thankfully, it doesn’t happen very often in Edinburgh and the Lothians. However, until the Government makes it illegal there will be people out there who will continue to gazump."

Have you been gazumped on the Lothians property market? Contact the Evening News 0131-620 8746.