The Buying Process

Chains

A chain is where you wish to buy a house from Mr A, but Mr A is waiting to buy a house from Mr B, and Mr B is waiting to buy a house from Mr C etc. In view of the late stage of fixing a completion date chains occur all too frequently in English real estate transactions.

The only way to avoid getting caught in a chain is to limit your search to properties listed as “no chain” or “vacant possession” (unoccupied). It is also worth getting your solicitor to confirm this as part of the conveyancing process.

Gazumping and Gazundering

The English property system is fraught with frustration as buyers and sellers may change minds or walk away right up to the last minute. Two common reasons for doing so are “gazumping” and “gazundering”. Though it’s hopes that readers will never encounter them it’s worth defining them here.

Gazumping is where a seller accepts one offer but keeps marketing the property and eventually accepts a higher offer. The maker of the first offer is left out of pocket to the tune of inspections, legal fees, and mortgage fees incurred to date.

Gazundering is where a buyer, having had one offer accepted, subsequently makes a lower offer. This may be genuine, in the light of faults identified on inspection, or may be based upon pure greed arising from the seller’s need to sell quickly.

Home Information Packs

In an attempt to partially address the inefficiencies of the English real estate system the U.K. government introducing “Home Information Packs” (HIPs) from August 2007 for properties with 4 or more bedrooms and from September 2007 for those with 3 bedrooms. Potential sellers have to compile a set of documents providing certain information about the property.

HIPs include an energy performance certificate, sale statement, title documents and local authority searches. Certain other documents relating to the lease are also required for leasehold properties.

There is currently widespread scepticism about the value HIPs for buyers and whether they actually benefit the transaction process. You should certainly ask to see the HIP for any property that requires one, but in no way should it be accepted as a substitute for having a survey and other checks you feel are necessary.