West London Man had been keeping his eye on the credit-crunch, the Northern Rock fiasco, the fall in house prices and the curious business of high street banks increasing their interest rates while The Bank of England reduces interest rates.
He did his research on house re-possession auctions… but the properties available were not, yet, suitable for his needs. So, he decided to become a gazunderer. He knew that an ‘epidemic of gazundering’ is sweeping through London and now blights one in five property sales – estate agents were reported today as saying in The Evening Standard.
The Evening Standard reported in their Friday 16th May edition that gazundering is a practice which involves buyers slashing their offers at the last minute before exchange of contracts – a perfectly legal practice – but ‘widely seen as unethical’ and one which brings misery ‘to thousands of anxious sellers’.
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George works in the City. Investment banking friends, keen to bolster their incomes following the relative poverty of bonuses this year, have been been keeping F*xtons and other estate agents busy by making offers on properties all over London and then, at the last moment, pulling out on the pretext that house prices had fallen in the four to six weeks between making an offer and exchange – or, more imaginatively, citing that the bath in the bathroom had not been properly plumbed in and that water damge had knocked 10-20 % off the value of the property.
George, unbeknown to Mrs West London Man, his wife Caroline, had made an offer three weeks ago to a 78 year old woman, a widow with a wooden leg, who was trying to sell her house to downsize so she could send a donation to a housing charity to enable the charity to help other old people in the autumn of their lives. George offered to buy the widow’s house for £450,000, the going rate in Twickenham for a property of that type – but, an hour before exchange of contracts, iphoned his estate agent to tell them that he wanted £90,000 off the price or he would pull out. Fortunately, the 78 year old woman was well advised by her estate agent and said she would be happy to reduce the price by £70,000 for a quick sale. Unfortunately the widow was only able to give the housing charity £18 after paying for her new bungalow, solicitor, moving and other costs, etc etc.
George instructed his solicitor to exchange contracts on the revised offer price and move quickly on completion as he had a buyer who was happy to pay £450,000 for the property.
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George has not told Caroline about this transaction.
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There is no audio version of this episode. I am a bit over refreshed – see below.
[…] QC has a post about gazundering.This is not a practice in which this blog would ever indulge, being unethical and mean. It is […]
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