Gazundering in house sales

Thanks, yes back in the day we used to exchange contracts about 3 weeks before moving, & the negotiation would happen some weeks before exchange.

&MOnica "*The Scottish system is not quite as wonderful as it seems. It is not dissimilar to the French system and we used to discuss this with Scottish friends. Even when a sale is agreed it can be made conditional on specific items.*"

You have misunderstood the Scottish conveyance system.
Its ALL about legally framed conditions; between both vendor and buyer, right from the start.

The exchange is formally conducted between their lawyers.The potential buyer's solicitor makes an offer to the sellers lawyer, containing legal conditions they require of the seller.

The seller may set a date on which to receive multiple offers , all from solicitors. Having read all the offers (and their conditions) he picks a favourite and his lawyer
makes an equally conditional acceptance with legal conditions the buyer must satisfy .

These negotiations are called missives. The solicitors then negotiate the missives until they reach a conclusion agreeable to both sides. Only then , at "conclusion of missives" does the contract become binding.

In my experience of buying and selling in the English system (4) and the Scottish system (11) I prefer the more formal Scottish one .

Agree butterandjam, I was about to write something similar.
I have just sold a property in Scotland, it took 10 weeks from start to completion and was the easiest selling transaction we’d been through over the years.

Lathyrus3

I’m not sure I would trust a survey provided by the seller. Even if I could sue afterwards.

My only experience of buying in Scotland d was when my sister was trying to buy there. She bid for over 20 properties in sealed bids and was outbid each time,

In desperation she bid all she had and ‘won” the final property.
She found out later it was £20,000 more than the next lowest bid.

A lot of money and almost two years of stress and disappointment, if not despair.

We certainly need reform though, perhaps some kind of initial contract at the point of offer and acceptance and a non-returnable deposit if either side breaks that?

Scootishb Home Reports surveys and valuations, are conducted in a set format by a qualified surveyor; and accepted by mortgage lenders.

I have always bid over the asking price to get the property I want in a competitive sale system. This is normal in Scotland.

In Scotland, the asking price is a bottom line starting point for "offers over" ; don't offer less like in England. The vendor confidently expects to get AT LEAST the asking price, and probably more.

How much more, depends on the competition, how many potential buyers are lined up to bid at closing date. (buyers will be told how many notes of interest have been received).

I'm sorry to say that a history of 20 failed bids, suggests that your D was pitching them wrong, she may have had poor advice from her Scottish lawyer, or didn't heed good advice.

We don't have a falling property market right now in Scotland.Unlike England, the property market is active and brisk . Local properties are selling fast (less than a week) at well over the asking price.

I take it you’re not in Aberdeen, Butterandjam? The market has been devastated there by government energy policies.

I'm in the process of selling my house in Scotland.
I have accepted an offer which was below the upset price and below the home report valuation.
It is now 'under offer'
The prospective purchasers have organised 3 surveys. Two have been done. One, a roof report, to go.
I am worried that they could still offer less for the property depending on the outcomes.
My solicitor is being supportive but I don't feel in a strong position if I really want to sell.
Either party can pull out until the missives are signed. There's also a chain as the buyers have yet to sell a property.

I think at the end of the day both English and Scottish systems have their advantages and disadvantages.

We have just bought our 6th house and looking back over them, the problems have not arisen from the legal side, but from the actions of the individuals involved. An estate agent that encouraged us to view and offer for a property that was already under offer and close to exchange, our agent telling a buyer that we would withdraw our house from the market when we had given him explicit instructions not to as the offer was low and they had not yet sold. a builder who waited until we exchanged contracts and then kept delaying completion, we finally moved in 4 months after the first completion date with the decorators and electricians still working on the house.

Yes obviously my sister was pitching her offers wrong. They were all above the asking price. Sometimes, as shown by her successful offer, considerably more, but in a ‘secret” system of sealed bids there’s no way of knowing what other people are offering.

I can see that knowing what others are offering can lead to a bidding war but at least you can decide whether you will go that extra thousand. I’m not at all convinced about sealed bids as a way forward.

Mostly people get gazumped, I lost a few house that way

I'm currently selling, I've said quite clearly I am not shifting on the agreed price at the last minute. I may still be living here next year as I'm not accepting this sort of thing.

Has the survey been done?

Does a seller get to see it?
Cant remember.

fancythat

Has the survey been done?

Does a seller get to see it?
Cant remember.

I’m selling atm ( well practically sold) My buyers showed me parts of the survey to negotiate a decrease in the price but I had no rights to see it

In Scotland if you make an offer and it's accepted then you try to change the terms, pull out, you can be liable for any expenses incurred due to your actions and end up paying for expenses, loss of any other person who had made an offer. The last debackle in selling/buying property ie the seller having a survey done to give potential buyers basic info on property, was meant to stop the old "offer" system. Lasted about two years from 2008 financial crash then offers has slowly crept back in. Really not much difference from other nations.

Sold and bought houses in Scotland fairly recently. It is correct that the Scottish system isn't legally binding until all the paperwork is completed. Generally once a house is under offer no further viewings take place so the highest bidder (or the one most a reputable to the sellers eg entry date, cash purchase, etc) is the one who gets the house. I believe buyers can , but seldom are, liable to be sued if they do not complete on a sale. Have only heard of deposits being taken on large farms. When I sold my last house in Scotland ( three years ago) the buyers were from south London. The completion day came and went and not a word from them until the following day when they said they would complete the following week. Very stressful and not how business is carried out here. Moving house is stressful enough.

My solicitor recently told me about a house sale/purchase where the buyers did exactly this at the last minute after speaking to the seller and being told that she needed to move quickly or lose the house she wanted. She felt she had to go along with this or lose the house and the chance to be near family. Despicable thing to do!

The Scottish system also has faults. Having to make sealed bids, the suggested price is much less than the eventual selling price. Everyone having surveys etc. Lost out on numerous houses as not bidding enough. Some properties went for £30k than the asking Price!

Plunger

The Scottish system also has faults. Having to make sealed bids, the suggested price is much less than the eventual selling price. Everyone having surveys etc. Lost out on numerous houses as not bidding enough. Some properties went for £30k than the asking Price!

You don’t have to have sealed bids. In our recent sale ( Scotland) completed at the beginning of July, we had 3 cash offers, no sealed bids. We accepted the one that was best and could proceed.
There was then a memorandum of sale that both seller and purchaser signed.

I thought the phrase was "Gazumping". A gazunder is another name for a chamber pot!

.

That has always seemed the most logical route to me.

I recall reading a few years ago that this was under consideration but it must have died a death as nothing ever came of it.

Pity.

Is Gazundering a close relative of Gazumping! Which used to happen on a regular basis years ago.

I was gazundered in 1990 London on the morning we were due to exchange contracts.

The buyer tried get £2,000 off the price,threatening to drop out. £2,000 was worth more than it is now. DH was working abroad but fortunately having 3 children 5 and under and a part-time job, I had nerves of steel and refused. The exchange went ahead, phew!

Plunger

The Scottish system also has faults. Having to make sealed bids, the suggested price is much less than the eventual selling price. Everyone having surveys etc. Lost out on numerous houses as not bidding enough. Some properties went for £30k than the asking Price!

The whole point of the Scottish Home report is that there is one survey, paid for by the vendor, and available free to all potential buyers.

"Everyone having their own surveys" died with the introduction of the HR.

I think there are those who want to undercut. Look at all the house hunting programs saying putting in a cheeky offer. However when we had our house on the market in 2016. Within days along came an offer at the asking price. Too good to be true you might think. And so it was nearer the completion date the offer came tumbling down Talking over 10% of the asking price. I think they thought we would be desperate as we had already bought our house which we were renovating. We were fortunate enough to be able to back out.

Alison333

I was gazundered in 1990 London on the morning we were due to exchange contracts.

The buyer tried get £2,000 off the price,threatening to drop out. £2,000 was worth more than it is now. DH was working abroad but fortunately having 3 children 5 and under and a part-time job, I had nerves of steel and refused. The exchange went ahead, phew!

Fantastic post. Well done! 🏆

Gazundering only happens when the market is weak and prices are falling. If demand for housing was high then the problem s more likely to be gazumping

I tend to look on gazunderers kindly, the only reason we got our current house which was a house we had coveted from the day it came on the market, was because, just when we had accepted that the house really had been bought by someone else and exchange was imminent and we were putting in an offer for another house, the intended buyer of the house made a gazundering offer, not knowing that we were in the wings and prepared to pay the asking price. The owner turned them down flat, withdrew from the sale and 2 hours later the house was under offer to us. We couldn't believe our luck and still can't