Gazumping is the term given to the situation where a seller pulls out of a sale after accepting an offer that came in above the original asking price. The term is often incorrectly used by would-be buyers after they have made an offer on a property that is below the asking price. The original buyers have then been knocked out of the running when another higher offer has been received and accepted by the seller.
The moral of the story is to think about offering the asking price rather than going below it. While it is possible you might succeed in buying a property for a price lower than the amount originally wanted by the seller, it can backfire on you. Trying to save money on the purchase is logical, but it can lead to losing the property altogether.
Before contracts are exchanged by the buyer and seller, either or both parties can withdraw from the sale without financial penalty. This means there is a risk that the seller could receive a higher offer on their property from another party. Since every seller wants to get the best price they can, it makes sense they would withdraw and go with the other buyer’s offer instead. Even if a seller seems nice and happy to accept your offer, few would turn down a few thousand pounds more for their property if someone else with deeper pockets came along. If you have found the property of your dreams, dropping below the asking price is a risky proposition, for fear of being gazumped.