Currently, a prospective house buyer in England and Wales can have a bid on a property accepted but can subsequently be ‘gazumped’ by another buyer who offers a higher price because the deal is only binding once contracts have been exchanged.
This practice sees around 200,000 housing transactions fall through each year with millions lost in legal fees.
The Telegraph reports that policymakers at the department for business innovation and skills held a private meeting with senior figures at the National Association of Estate Agents (NAEA) last week, where plans to end gazumping were mooted.
Following this, a “call for evidence” was made into how the government could make it quicker and cheaper to buy homes in England and Wales, which the department is due to publish in the near future.
Gazumping is not an issue in Scotland, where a house sale contract is deemed binding once an offer has been accepted.
The English system dates back to the 1920s and was deemed ‘archaic’ by the managing director of the NAEA, Mark Hayward.
