Q. I’ve heard that gazumping has reared its ugly head in the property market again, as a seller this is good news as surely this will now start pushing the property prices up again?
A. Correct, gazumping has been occurring quite a lot lately, due to the ratio of buyers per property for sale. Although as a seller this might sound like music to your ears after the last traumatic year, it’s not to be misconstrued. Certainly the property market is moving again and agents are starting to recruit to cope with the current demand from buyers who are certain that with prices 20 to 25% lower than in 2007 buying now is a great opportunity. The reason why we have seen some gazumping is because of the lack of good quality available stock; lack of stock has been caused by sellers being reluctant to sell at today’s prices. The result of this being that the only property to hit the open market is forced sales or people trading up. Most sellers have simply decided to hold off until the recession is well and truly behind us refusing to let the equity that they have made in their asset slip through their fingers, and who can blame them. Of course today’s buyers are keen to secure something right now whilst the prices are at their lowest and this is what is causing the gazumping. When a new property hits the market there are several buyers waiting to view, of course it’s a battle to secure it with so many other buyers in competition with each other. Please don’t be fooled into thinking this will start to push prices up just yet. Buyers are extremely knowledgeable yet cautious and are not prepared to pay a penny more than they believe its worth so if they are offered something that is above the current market value, they are often keen to have a look but make it perfectly clear that they will only pay what its worth in today’s market. Certainly the green shoots we are seeing right now are a reason to be cheerful, but let’s not get over excited on value’s increasing just yet.