Gazumping could be banned as ministers plan shake-up to protect thousands of home buyers who suffer disappointment and huge bills from sales falling through

Gazumping could be banned under a shake-up of the housing market being considered by ministers. 

The Government is seeking measures to protect thousands of people every year who suffer the disappointment and expense of their sale falling through.   

Around £270million is wasted annually on legal fees and surveys for failed house purchases in England and Wales - often as a result of gazumping, where a buyer makes a higher offer for a property than another offer that has already been accepted. 

Around £270million is wasted annually on legal fees for failed house purchases in England and Wales

Those left in the lurch face the frustration of losing out on a dream house, huge legal bills and home survey fees which can run into the thousands of pounds.

The Government is considering cracking down on those who pull out of buying or selling a house at the last minute.

Experts said one option would be making house purchases legally binding earlier, as they are in Scotland and across Europe. Such a move could prevent gazumping.   

It could force people who pull out of a deal to pay the other party’s costs. Buyers could even lose their deposit if they withdraw from a purchase after signing a contract.

Home purchases in England and Wales typically takes 14 to 16 weeks – far longer than in most European countries

Home purchases in England and Wales typically takes 14 to 16 weeks – far longer than in most European countries.

BUILDING SOCIETY LIFTS AGE LIMIT ON HOME LOANS FROM 75 TO 80 

The age limit on home loans is being increased by the UK's biggest building society 

Britain’s biggest building society is increasing the age limit on home loans from 75 to 85 – the oldest a customer can be when their mortgage matures.

Customers of 80 will be able to have a home loan with a maximum term of five years.

The limit – the highest of any major high street lender – follows accusations of age discrimination, and comes days after Halifax raised its limit from 75 to 80.

David Hollingworth, of the mortgage broker London & Country, said: ‘This is a definite step forward.’

More than a fifth of transactions fall through each year. There were 915,536 sales in 2014, according to the Land Registry, which means around 200,000 sales collapse.

In the Budget in March, the Government signalled its plans to address the problem, saying: ‘We will publish a call for evidence on how to make the process better value for money and more consumer friendly.’

Policymakers at the Department for Business met with officials from the National Association of Estate Agents to discuss proposals on ending the practice of gazumping, according to the Daily Telegraph. 

The Government is expected to issue a 'call for evidence' within weeks on how the process for buying a house could be sped up and made cheaper.  

There is nothing to stop buyers from backing out of a purchase at the last minute, after the seller has incurred hefty legal fees and turned down other offers.

Solicitors still typically exchange papers manually and the transaction is not legally binding until contracts are exchanged. 

In Scotland, however, once an offer has been accepted the buyer has entered into a legally-binding agreement.

Neither party can withdraw without being liable for the losses of the other party.

Mark Hayward, of the National Association of Estate Agents, said: ‘No one looks forward to moving house – it’s a painful experience, like going to the dentist. We need speedier transactions and a simplified legal system that makes deals binding at an earlier stage.’

However, while outlawing gazumping could benefit buyers, there are fears that the move could prove unpopular with sellers and could even put them off moving house as they could be forced to cover the cost of legal and survey fees, which are currently paid by buyers. 

Asking prices for homes cut by £25,000 amid growing fears about the health of the property market

People selling their homes are slashing more than £25,000 off their original asking price on average amid growing fears about the health of the housing market.

The average discount on homes has increased by almost £4,000 to £25,265 since the start of the year, according to a report.

The findings – taken from properties listed on Zoopla’s website – also show 29 per cent of homes currently on sale have seen their price cut at least once since there were first listed.

People selling their homes are slashing more than £25,000 off their original asking price on average amid growing fears about the health of the housing market

The increased haggling power is a boost for home buyers – particularly those looking to get on the property ladder.

Experts pointed out that estate agents are often to blame as they give unrealistically high valuations for a property in order to win new business.

But the rush of homeowners cutting their asking prices is also a signal that confidence in the property market is waning.

Eight out of ten areas with the highest proportion of properties with a reduced asking price are located in the north of England.

Almost half of all properties listed in St Helens (43.7 per cent), Hartlepool (42.5 per cent) and Middlesborough (40 per cent) have been marked down.

Separate figures released by Halifax yesterday showed house price growth is slowing, with confidence in the market at its lowest level for more than a year.

House prices grew 1.5 per cent to £212,321 in the three months to April – just under half the 2.9 per cent growth registered in the three months in March.

The annual rate of growth eased from 10.1 per cent to 9.2 per cent in April – the slowest pace since last Autumn.

And house prices actually fell 0.8 per cent last month.

The average discount on homes has increased by almost £4,000 to £25,265 since the start of the year

The dip has been partly blamed on the rush of buy to let landlords and second home buyers trying to snap up property before the recent stamp duty hike on April 1.

House sales jumped from 116,930 in February to 165,480 in March – the highest since Halifax began compiling the data in April 2005.

Martin Ellis, housing economist at Halifax said the shortage of property and high demand – coupled with low interest rates, rising employment and wages – should continue to push house prices up over the coming months.

But he warned: ‘Weakening sentiment regarding house price prospects and a dip in consumer confidence however suggest that annual house price growth may ease.’

Experts said that some sellers had put inflated price tags on their homes, in the hope that they would be snapped up by a buy-to-let landlord eager to beat the April 1 stamp duty deadline.

They have since been forced to reduce their asking price in April as demand from investors has died down.

The increased haggling power is a boost for home buyers – particularly those looking to get on the property ladder

London buyers looking to get a knock-down price may want to head to Barnet – which has the biggest average discounts in Britain, with a 10.8 per cent cut on average. This equates to £120,969.

Big discounts can also be found in Coventry (10.43 per cent or £27,320) and Salford (10.39 per cent or £16,634).

London’s ultra wealthy borough of Kensington and Chelsea tops the list of the ten London boroughs with the highest proportion of asking price reductions.

A third of properties in the area have been marked down, with the average discount of 7.95 per cent equating to £137,421.

Ray Boulger, from mortgage broker John Charcol suggested that the discounts reflected inflated initial valuations from estate agents, as well as the slowdown in the market after the April 1 stamp duty hike.

He said: ‘Many estate agents will deliberately over value houses to get the commission. Even if they can’t sell at that price they work on the basis that the seller will stick with them.

These discounts can be misleading as the original price was not realistic in the first place.’

• j.salmon@dailymail.co.uk