Homebuyers are being gazumped due to lengthy property chains and delays in getting a mortgage, new research from Market Financial Solutions has revealed, with many experiencing financial losses and emotional strain.
The specialist lender commissioned an independent survey of 1,183 people who have bought a property in England and Wales since 2014, finding that 37% had been gazumped during the process. Of those, 59% said they were gazumped, at least in part, because of delays or long waiting times in getting a mortgage.
A further 58% said they were gazumped on a property they wanted to purchase as they were stuck waiting for a buyer for their property. Indeed, more broadly, 54% of those who have been gazumped cited being caught in a long property chain as a significant factor.
MFS’s survey also shed light on the financial and emotional toll of being gazumped: 62% of people said they missed out on their dream home, and 61% were forced to buy a property that they liked less.
In addition, a majority (59%) of people lost money they had invested in the property-buying process (such as survey costs and legal fees).
Paresh Raja, CEO of Market Financial Solutions, said: “Much is made about the root causes of gazumping, namely the fierce competition there is in the market due to an imbalance between supply and demand. But in looking for the cause, we often overlook the emotional and financial impact that gazumping can inflict.
“Throughout the purchasing journey, prospective buyers often develop a strong attachment to a property, making the sudden collapse of a deal particularly difficult to stomach. On top of that, thousands of pounds are typically lost when a deal falls through, rubbing salt in the wound.
“Clearly, with lengthy property chains and mortgage delays cited as key factors behind people being gazumped, there are lessons for lenders, brokers and agents. All parties must work together to reduce the risk of delays and ensure that buyers can secure finance at pace. In turn, this will help close the window of opportunity for gazumping tactics and minimise the emotional and financial impact on would-be buyers.”