Gazumping, Gazundering, and Breaking the Chain

Our first attempt at buying a home in London fell through.

Two weeks before we were about to be handed the keys, the bank abruptly decided that the maisonette we were purchasing had a value of zero, and therefore, they would not be giving us the agreed mortgage. Nor would the next lender we tried. Nor the next. They’d practically dangled the keys over our palms, then taken them away again.

We’d gone through more than six months of surveys, wangling with solicitors, city offices, endless forms, and plain old bureaucratic sludge. The couple selling the maisonette were due to have a baby and were planning a move to Yorkshire. And our landlord was closing on the sale of the flat we lived in within a month. When the mortgage fell through, we didn’t have the savings to buy a house in cash.

We had no choice but to pull out, leaving everyone involved utterly screwed. The sellers eventually had to find a cash buyer because no banks would touch the place. It may not have been our fault, but it felt like it.

This was our introduction to the Byzantine world of British — and more specifically, English — home purchasing.

Every country, of course, will have its unique rules and norms when it comes to house hunting and purchasing. But when you see the flabbergasted netizens asking why gazumping even exists, you begin to understand that the process here is … eccentric.

Nor is it particularly effective. In a survey by the property-data company Moverly that looked at purchasing completion times in the twelve countries that Brits are most likely to move to, Britain came dead last in the race to completion.

Compared to the US, where the process took an average of 53 days; and Canada, where it took 90 days; Britain averaged 179 days.

That’s six months for those not doing the maths.

Essentially, our failed purchase was right on time — if only it had gone through. Now, today, we’re trying again.

“Six months!?” came the incredulous cry from almost every Canadian or American I spoke to. “How could the sale take six months?”

Everyone thought we had done something hideously wrong. We had not.

The central problem is that the maisonette we were attempting to buy was a leasehold. Leaseholds and freeholds go back to the years shortly after the Doomsday book — the first survey of the population in the newly established Norman kingdom of Britain.

Historically, freeholders were landowners, and leaseholders became their tenant farmers, working the land as serfs and providing food to the landowner as well.

Today, of course, having a leasehold simply means that you own your home but not the land it is built on. This can also stretch to other things, such as property walls and fences. The freeholder of your leasehold is usually a company, but is also often a local government, such as the borough or city you live in. And although the freeholder is functionally a landlord, it is in title only. Once you have bought your leasehold property, the so-called ground rent is most often a “peppercorn rent” because it is token sum — as little as £1 per year. The majority of flats in Britain are still sold as leaseholds.

But this system is on its way out.

In May 2024, the government passed the Leasehold and Freehold Reform Act — a set of laws set to both improve the rights of leaseholders and slowly end leasehold properties by attrition.

It may take a very long time. Existing leases can be more than a century long, but are only allowed to be renewed once. The Leasehold and Freehold Reform Act allows people to renew a lease for up to 990 years. So, in theory, some of those leases may still be around in the year 3000.

Under the reforms, there will be no leaseholds permitted on new properties, and ‘share of freehold’ for flats (which gives leaseholders a share in the freehold of a property of building) will be replaced by the simpler commonhold system — in which homeowners are freeholders, and an association of the building’s freeholders own the building equally.

It’s all as strange as it sounds. And leaseholds generally take much longer than freeholds to complete, so few Brits were surprised when I told them that our sale was dragging into its sixth month. There is more paperwork and more back and forth between councils, solicitors, agents and others. And more opportunity for things to go wrong.

We swore never to attempt a leasehold again. And it looks like the country now agrees. And with time, this arcane system will be put to bed.

What is a property chain? Put simply, it is a slow-moving conga line of buyers and sellers, all held together by conveyancers and red-tape, with clients hoping to complete the sale and move into their new home at the end.

The links in this chain, as you might be able to guess, are the parties involved in moving from one house to another. As first-time buyers, my wife and I are considered ‘chain-free’ — catnip to sellers. We are renting and do not have to sell a house. We can move at any time.

But we were only chain-free until we ended up in a chain.

The seller who accepted our offer also needed to find a house; this took two weeks. Then we were informed that her seller needed to find a house; this took another week. And the person selling that final house was, fortunately, chain-free. All of our fates are now bound together.

For the first week, we bombarded the agent with questions until he informed us there was no real point in instructing a solicitor/conveyancer, or hiring a surveyor, until the chain was complete. So there we were: more than three weeks in, unable to even begin the paperwork. It was frustrating, but starting over again would be worse.

In the British system, each and every move you make has to be coordinated with the other parties. Rather than sign a contract early on, leave the responsibility for vacating the property up to the seller, and have penalties for failing to do so, the contract is not signed until all paperwork, checks, surveys, and so on, are complete. Each step is a clunky dance between solicitors to ensure that everyone moves out on the correct days and no one is left homeless in the process.

As a result, everything depends on the communication (or lack thereof) between the people involved. When your solicitor takes a two-week holiday in Málaga, everyone in the chain has two weeks of sitting on their hands.

By the same token, if someone backs out or is gazumped (we’re getting to that), the chain is broken, and everyone has to start over or wait out the solution.

I confess, I’m a little fascinated by this. While the whole process is delicate, complicated and unwieldy, there is also a feeling that the system is designed to make sure that no one ends up functionally homeless.

I know there is more to it than this — it’s likely less a matter of design and more a matter of market forces. Nor does the chain give that much more financial safety than a contract-first, penalty-later system — after all, the fees incurred along the way range into the thousands and will still be lost if the chain is broken (unless you are insured).

But there is something satisfying in knowing that all of us in this chain are heading toward the same goal.

It’s hard to imagine a more ridiculous word being used in such a serious context. When I first had someone explain being ‘gazumped’ to me, I thought they were making the word up — using a bit of internet slang that I hadn’t heard yet.

But, no. Gazumping is, in fact, the official term for accepting a higher offer on a property that has already had a previous offer accepted. If the seller accepts my offer of £500,000 and then gets an offer of £525,000 from someone else, I can get dumped for the better deal, even if I have a memorandum of sale.

That is being gazumped.

The origin of this word comes from the Yiddish gezumph, meaning to overcharge, but it joined the English language in the 1920s as a slang term for ‘swindle.’ It didn’t take on its current real-estate meaning until the 1970s, but it’s now baked into the industry.

Gazunder, by contrast, is the tongue-in-cheek portmanteau combining ‘gazump’ and ‘under,’ and it came into use about a decade later. Gazundering refers to what happens when a buyer — usually compelled by unfortunate discoveries in a property survey — decides to switch to a lower offer. Often, this is done close to completion, which has the effect of pressuring the seller into taking less money rather than starting all over again.

“But is this legal?” I hear you ask. Yes, it is. It probably shouldn’t be, but it is.

In most cases, the seller will offer to take the property off the market once they have officially accepted your offer, reducing the possibility of being gazumped. This doesn’t change the fact that others may already have seen the property and can jump in with a new, higher offer. An ethical agent won’t allow this to happen — but it isn’t a field renowned for its ethics.

Both gazumping and gazundering are considered acting in bad faith, but they happen, nonetheless. And when they do, everything grinds to a halt — one that might be temporary or permanent.

When it comes to property transactions that fall through before completion, the figure most often quoted in the UK is one out of five. However, a study from Quick Move Now says that in 2024, it was closer to 28.8 percent — nearly one-third of all transactions.

Breaking it down, the two biggest reasons for failure were buyers trying to renegotiate the price after a survey (27.3%) and the buyer simply changing their mind about buying (23.6%). After that, the reasons are listed as: the buyer not being able to secure a mortgage (21.8%), the buyer being gazumped (14.5%), someone else breaking the chain (7.3%), and lowest on the list, the seller giving up because the process is simply taking too long (5.5%).

It’s enough to make you wonder what life might be like on one of those canal boats. They’re certainly easier to buy.

So, what’s to be done? Nothing, really. Being forewarned is the best thing you can do. Be proactive and engaged with the process — call your solicitor and the selling agent regularly and check in if things have stagnated. Keep a few properties in your bookmarks and don’t delete all those real-estate agents that have your name on file. Our solicitor pointed out that it’s easy enough for him to change the paperwork if you need to start over with a new property.

The worst thing about this is, of course, the uncertainty.

I’m not sure if there is anything to do about the stress of being “always on” regarding the purchase. Your only choice is to take it one day at a time, one survey, one certificate, one setback at a time.

Go to a movie. Do a little evening meditation. Buy yourself that expensive Cognac to open when you get the keys, then when things get rough, you can touch its bottle and whisper ruefully, “One day, love. One day.”

For now, the process goes on. All we can do is cross our fingers and toes, and hope that nothing goes gazump in the night. ◾️

What I’m reading: This Happy by Niamh Campbell, which I confess I read before the last update. (I don’t think I read a book every week. Who am I kidding with this section?) That said, I’ve been in this unintentional Irish place lately, just having finished watching Bodkin, and reading Ryan Frawley’s ridiculously good Scar not that long ago. There are moments where Even If Everything Ends (which I mentioned last week) and This Happy collide. Perhaps it’s only insofar as major characters in both books have an affair with an older man, but there are strong resonances in both.

I almost want to call This Happy a light read. It is not, but I want to say it is light in the best possible way. I think there is a tendency these days for every story to drag itself through trauma. And while there is some trauma in This Happy, the book does not make a meal of it. There are ups and downs, and things go very wrong. But it is not a novel that revels in breaking its character down to her lowest. She is engaging and funny, if sometimes insufferable, and you just want to listen to her talk all the way through.

And because I am a sucker for structure, I’m fascinated by the way that her current husband is only ever called “my husband,” while her lover from the past gets a name. It is this technicolour affair nestled against the muted tones of a happy-enough marriage that keeps you guessing. And that’s what makes it fascinating.

What I’m watching: Shōgun, it turns out, is pretty engaging television. And finally, we are beginning to see Japanese actors showcased against Western actors in a way that is effective and realistic toward both.

The level of study and dedication to getting the Japanese right in dialogue, history, and culture is clear. And to do that — to get both sides right for once — is accomplishment enough. But to do it in a tense, rollicking adventure story is worth applauding. I hope it carries on just as well as it has started.

What I’m up to: Saturday was full of Deptford Literature Festival events. And honestly, what I can’t get past is that all of this was free. The small drawback of free events with tickets is that people reserve seats on a whim and then decide not to show up. So, a few of the talks I wanted to see were sold out on Eventbrite, but when I arrived (just to see if I could talk my way in), only two-thirds of the seats were full. Such a waste. But the organizers were sensibly allowing people who had not arranged tickets to go in, so I was pleased to be able to attend the literary agent panel I wanted to see, along with author talks by Santanu Bhattacharya and Irenosen Okojie (whose book Curandera I cannot wait to read), and talks by local science-fiction and fantasy authors M. H. Ayinde, Marve Anson and Esmie Jikiemi-Pearson — all of them winners or short listed in the Future Worlds Prize.

All of this is brought to us by our own local Booker Award winner, Bernadine Evaristo, who founded Spread the Word and is a Lewisham/Greenwich girl to the bone.