Home buyers and sellers can expect an end to gazumping in a major shake-up of the housing market, as the government plans to introduce legally binding sales agreements much earlier in the process.
Under current rules in England and Wales, a buyer can accept an offer and then pull out weeks or months later if a higher bid comes in, leaving the original buyer with no legal recourse. The new reforms, first announced last October, would make conditional contracts binding from the moment an offer is accepted, preventing either party from walking away without a legitimate reason.
“UK government plans legally binding house sale agreements to end gazumping, saving buyers £650 on average.”
“We’re turning the page,” said Prime Minister Sir Keir Starmer. “Our reforms will bring this outdated process into the modern age, saving people time and money, and giving them the certainty they deserve.”
The government estimates the changes will save buyers about £650 on average. Housing Secretary Steve Reed said the reforms would make the system “faster, fairer and more secure”.
The plans also require sellers and estate agents to provide more upfront information about a property, including its condition and status in a chain, through so-called sales packs. This mirrors the Home Information Packs introduced by a Labour government 20 years ago, which were later scrapped by the coalition.
The timetable suggests a new code of practice for property agents will be introduced this year, though the full reforms will not take effect until the end of this Parliament in 2029. Previous attempts to improve the system have had limited success.
The changes have been widely welcomed by the housing sector, though some have raised concerns about unintended consequences, such as properties taking longer to get onto the market while paperwork is prepared.
In Scotland, formally accepted offers are already legally binding, and sellers must provide home surveys to prospective buyers. If a party withdraws after solicitors exchange letters – known as missives – they are liable for financial losses to the other party. The government’s proposal for binding conditional contracts would bring England and Wales closer to that model.
“The current home buying system leaves people in limbo,” Starmer said, “and puts the prospect of home ownership out of reach for some.”