'Gazundering' back on property menu

HOUSE-SELLERS are having a "bullet put to their head" in the Westcountry as buyers demand dramatic last-minute price reductions – often of tens of thousands of pounds – as the property market slumps further.

Estate agents across the region are reporting a return of gazundering, an "immoral" practice in which buyers slash the price they are willing to pay just before contracts are exchanged.

A Westcountry-based spokesman for the National Association of Estate Agents said buyers demanding an 11th-hour 10 per cent cut – or £25,000 off the £250,000 average price of a home in the region – was "not unusual".

One young family lost their "dream home" in Devon after the buyer threatened to pull out if they refused to cut £30,000 off the sale price of their £430,000 south London home.

Carrie Horne, who was moving to the Westcountry with husband Rick and daughters Jemima, four, and Daisy, two, said: "I was so angry. It felt we were being blackmailed."

Mrs Horne, who is pregnant with the couple's third child, said that the buyer had exploited the family's vulnerable position.

Mr Horne, who took up a senior role at a Plymouth-based television company, was already living in Devon. Jemima, meanwhile, needed to be settled before starting school.

Despite shelling-out £3,000 on solicitors, the couple pulled out of the five-strong chain.

For the past three weeks, the family has been living in a rented home in Newton Abbot while playing "reluctant landlords" with their London home.

They expect to sit on their hands for 18 months.

Mrs Horne said: "We didn't have the money to take £30,000 off. Also, it is one thing to do it at the beginning, but weeks later is quite another.

"We found a beautiful home down here owned by a lovely elderly couple. That was the worst bit for me. They had found the house they wanted to live in for the rest of their days."

Richard Copus, Devon spokesman for the National Association of Estate Agents, explained that gazundering was the reverse of gazumping – where buyers are trumped by better offers at the 11th-hour in a rising market – and was symbolic of a falling market.

The average UK home has lost 16.1 per cent of its value during the year to the end of November, to stand at £163,605 – nearly £31,500 lower than 12 months ago, according to the Halifax.

Mr Copus said: "This is a classic example of how putting a bullet to a home-seller's head can destroy the arrangements of half a dozen people."

In some areas, half of all transactions see attempts at gazundering, according to a study by the National Association of Estate Agents.

Mr Copus, who runs his own estate agent business, said: "We are seeing it quite a lot. Someone will try it every couple of months."

But he was keen to stress it did not always work for "greedy" buyers, and many of the "vultures" ended up being disappointed when their low-balling meant they lost the house.

He said when surveyors found fault in a property, it was "part of the game" to expect the price to be reduced. But this was not the case with the Hornes.

He said: "Some are genuine. If their surveyor went round and advised them to drop the price – then most people are understanding. Even in a good market."

Under English and Welsh law, gazundering is not illegal. "The magic phrase is subject to contract," said Mr Copus.

Ian Lillicrap, director of Truro-based agent Lillicrap Chilcott, which markets properties across the county, said the practice was "disgusting, conniving and pre-meditated".

Last week, a buyer tried to get £100,000 knocked off a "substantial country property" where £1.25m was the agreed sale price. The bid failed.

Mr Lillicrap said: "I'm pleased to say we were able to recommend to our client to reject that attempt and go with the reserve bidder, who had been waiting in the wings. Mr Gazunderer caught a bit of a cold."