Hi all
Has anyone heard the term gazumped? My sister, who lives in Sydney has just been negotiating a price on a property in Caboolture, Qld. The property was listed with multiple agents and while their contract was going back and forth settling on a price, another buyer came in over the top with another agent and won the contract.
This seems a little unfair and would seem to be illegal as i thought once a property was “under contract” no other party can enter into the negotiation until that contract is either accepted or made void.
Your thoughts would be much appreciated as they are very distressed to lose the property.
Thanks,
MattMatt Jones | Property Resource Shop
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A property is not under contract until both parties have agreed on and signed a contract.
Would you have taken a higher offer if you were the vendor?
Cheers,
Simon Macks
Residential and Commercial Finance Broker
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Hi
Gazumping is very common in the UK – except for Scotland where they have a more sensible system. I remember being gazumped a week before we were to move into a house – had no option but to gazump them back and offer more.
The only way to have a contract stick before you get the contract physically back (under the Australian system) is to make an offer conditional upon acceptance within x days, notification to be by a letter. You often find a vendor finds it easier to pull the trigger psyschologically on this than on the contract, especially if they have multiple bids>
regards
J.happens a lot nowadays..especially in a rising market.
In Perth at the moment i’ve seen properties stay open to offers for a week or two; you submit your best offer along with others and in most cases the highest offer gets the deal or gets to negotiate, whereas in the past years if you put an offer in, then in a lot of cases the negotiations were between you and the vendor only (no one else got a look in)..
Good for the seller, not so good for a buyer………
A friend gets around this by doing as J has said (offfer is on the able for 24-48hrs)
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow Calculatorhi mattjones
have a read under put call options every negotiation I do I put a put call option for min 2 months before I even go for my letter of offer from a bank I have two in at the moment and paperwork on the way.
This way you cann’t be gazumped in any form and you negotiate the fee to a minimum under 3 months is $1.00 it is a formality but it works.
both you and the vendor know you are going to buy the property.
and if anything goes wrong you can pull out.
have aread and I recommend all purchases to use them.
sorry for any mistakes in spelling as I have ameeting to go tohere to help
grossrealization I like your idea. Personally, I think the term ‘gazumped’ is a misnomer as it’s definition is used so liberally (and illegally) across the board in purchasing. Even after the ‘ink is dry’ I’ve been told ‘don’t worry you’ve just been ‘gazumped’ and it will only serve to make you a better investor in the future!’
Cheers,
Gatsby.“Sometimes the hardest thing to do in life is often the best thing to do.”
Yep…It’s never “yours” until both parties have signed the documentation..
Your Idea sounds interesting GR..If the REA’s dont know about it though, I can see them being difficult or hesitant when presenting your offer to the vendor?
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow Calculatorhi redwing
Most if not all would understand and know of them as they are used as a norm om commercial sites.
I don’t nor have I seen much problem with it.here to help
GR does this mean you pay the seller a fee for the option to purchase the property at a particular price?
If this is the case wouldn’t there still be a bit of haggling over the price in the option where another buyer could offer a higher price?
hi Aphex
no you do your normal haggling and when the price is fixed then you put call option the vendor has a legally binding contract that they will sell at this time for this price.
very simple.
cost usaully $1.00here to help
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