SBP: The growth of.... gazundering

Gazundering has been discussed in the past on the Pin, but the SBP has now realised that this phenomenon might occur in Ireland.

Interesting point made near the end of the article about potential vendors refusing to put the property on the market. That seems to tally with anecdotes that some people have reported here recently. With this attitude it seems that we will be in for a slow, protracted decline.

SBP link

tell that dozy journo to look at Daftwatch before it opens its mouth again

https://daftwatch.atspace.com/daftwatch.gif

The comment about the number of houses coming to the market is nonsense, but it still seems that there are plenty of people out there who planning to “wait it out” until the good times return. Perhaps when we see a significant shift in opinion among this section of potential vendors, we will see a landslide of properties coming onto the market.

True , its just not having any effect on Daft listings . The SBP could have checked before they allowed that divvy statement of ‘fact’ to be printed.

Now where did I see that being predicted months (if not years) ago?

No doubt the usual suspects will be lined up to “lobby” and “campaign” for reform now that it suits them.

That said, I still believe gazundering and gazumping are unethical and immoral ways of conducting business. In an ideal world, business transactions would exist solely to facilitate the transfer of honest labour from one form to another – wishful thinking I know… It’s even more immoral to tolerate the practice when it’s happening to the weak (i.e. FTBs) and abolish it when it’s happening to big property developers and wealthy property-owning individuals seeking to bail out.

Instances of gazundering are now surfacing on AAM…

Link

Correct . And thats why the new property something agency something regulator with 50 people scratching their holes in an expensive office out in Navan should build a “bid escrow” website and the contract must be issued for the highest bid escrow price and signed for that and paid for that .

Then there is an agreed price and all parties, including the taxman , know exactly what it is.

Works in all markets, up or down.

Produces reliable stats too 8)

I’m presuming that if someone tried to gazunder and the seller refused, and insisted that either the buyer play ball at the agreed price or walked away, that the potential gazunderer would lose their booking deposit.

Or am I way off on this one?

There is no legal agreement to allow that. No contract, no recourse.

I’m not sure what you mean exactly.

I would’ve thought the deposit was payment for an agreement to take the house off the market and reserve it for the buyer.

Isn’t that the idea of a deposit? You reserve something for later payment and lose that initial money if you decide not to buy?

Anyway, why would the seller voluntarily hand back the cash? “Alright, you’re messing me up and potentially causing me huge financial losses. Oh and here’s your big wedge of cash back…”

Solicitors hold the cash… not the sellers. If there is no contract then there is nothing to force the completion of the sale. It’s typical goose and gander stuff… it was good for the goose when they had a deposit but got a better offer and decided to accept the new one… and the gander could do nothing about it… and now the gander can decided to do the opposite… and it’s tough luck for the goose…

Just the system we have, like a lot of systems… it’s designed more to exist than to actually work and protect the interests of those involved.

To make something legally enforcable you need two things, a contract and a “consideration”.

At the point of a booking deposit you have a verbal statement of intention only. That is not a contract and can not be enforced legally. Hence the other party has no legal right to retain the money.

In just the same way, you can sign a contract, but not make a deposit and that contract couldn’t be enforced because there is not consideration.

surprisingly MrMan has given some fairly realistic advice regarding the situation the sellers finds themselves in. In the past I’ve only seen him give very bullish advice on AAM. Perhaps he is in the process of a road-to-Damascus conversion :wink:

Then why would a seller even bother going sale agreed? Why not wait until contracts signed and see what sort of offers arrive in the mean time?

Also if I was selling a house and there were two or three other properties “in competition” with mine, what’s to stop me getting a friend/relative to go sale agreed with all of them, stringing them along for a few months so that mine has a better chance of selling to a real buyer while the others are waiting to complete a sale that’ll never happen. And then collecting my deposits back at the end?

I know it’s been mentioned above but it seems like a pretty dubious system to me.

I’ll also have to review my definition of the term “deposit”.

I never heard one complaint from an ea or a vendor when there was gazumping galore on the way to peak bubble now its all unfare on the poor mites.

Well Ive news for them while I dont agree with either gazumping or gazundering my attitude is F*** You lifes tough. What about all the poor people who are stuck for 40 years with a shackle around their necks due to the " good work " of the EA? Who gives a rats ass about them?

Whats good for the goose may not have been correct but they still took the increased sale price so why shouldnt the gander take the decreased sale price?

Quite. There is nothing to stop you doing it, so long as you are happy to dole out 5k here, 5k there.

I class it as a show of faith until you can get the legal work sorted out, which naturally take time. The buyer stumps up a refundable deposit to display some intent, the seller tells people that they are “sale agreed” and doesn’t take any more viewings.

Besides, suppose that you agree verbally (as the buyer) and then when the lawyer does his/her searches and you survey runs their ruler over the property you find out something quite important about the place that you weren’t aware of - it is sinking into a bog pit, say. You don’t want to incur all those transaction costs for each house you are considering, nor do you want be tied to a purchase until you have full information.

I have never had any problem with it, the same system operates in the UK (though not in Scotland).

I will back out of a purchase if the vendor is unwilling to post a “sale agreed” sign and put a hold on viewing for a reasonable amount of time - simple as that. I have no problem with an agent taking note of enquiries, but I would definitaly want active marketing to be put on hold.

Vendors in the current market would be best reminded to keep a potential buyer on side.

If you were selling your house to me, you would have lost yourself a buyer.

Show of faith on both sides, I give you a deposit, you take it off the market.

+1.

If I had put a deposit on a house I would expect to see it come off the market and the online adverts (daft/myhome) go to sale agreed. If not, I’d be outta there