Homebuyers are avoiding entering the market due to fears of getting gazumped or gazundered, latest data from iamproperty reveals.
Over 14% of respondents to the proptech supplier listed the risk of being gazumped or gazundered as the top deterrent. This was closely followed by Stamp Duty and other tax implications (12%), and high mortgage rates (12%).
Ahead of the Stamp Duty Land Tax (SDLT) threshold drop from £250,000 to £125,000 and from £425,000 to £300,000 for first-time buyers on 1st April this year, a timely completion is essential to secure the favourable rates.
Despite the homebuyer’s initial rush to complete before the hike, the risk of being gazumped or gazundered is keeping some out of the market entirely.
AGENT OPPORTUNITY
But Jamie Cooke (main picture), Co-Founder at iamproperty, sees this as an opportunity for agents to explore other methods of sale, especially as time runs out for buyers to complete and make savings.
He says: “Private Treaty sales can often take six months or longer to reach completion. More time on the market means more opportunities for gazumping and gazundering to happen.
“Agents could be missing out if buyers are aware of the benefits that Auction can provide in these market conditions.”
AVOIDING GAZUMPING
Cooke says that whilst Auction is growing in popularity, there is room for more people know about it and its benefits, especially when it comes to avoiding the frustrations that come from gazumping.
He adds: “We’ve seen increased interest in Auction since the Budget, with bidding activity up by over 64% in December alone. In these market conditions, Auction allows Estate Agents to provide a method of sale with speed and security built in, with completion in 56-days and a 95% completion rate.
“The non-refundable Reservation Fee secures the property for the winning bidder and significantly reduces the chances of gazumping – while ensuring that sellers cannot be gazundered. This provides the certainty buyers and sellers need when timescales are tight.
“We’ve already seen attitudes towards Auction shifting – data from an online survey conducted by iamsold found 36% of people would consider using auction to buy property – with over half (56%) of 18 – 34-year-olds open to the idea. With the upcoming changes to Stamp Duty, now is a great time to add Auction to agents’ list of services.”
