A buyer who thought they had secured a home, only to be outbid weeks later, is at the heart of a problem the government says it will finally fix.
Legally binding agreements will be introduced much earlier in the house-buying process in England and Wales, ending the practice known as gazumping. The reforms, first announced in October last year, are part of a package aimed at making the system "faster, fairer and more secure," according to Housing Secretary Steve Reed. They will be introduced at the end of this Parliament in 2029.
“Gazumping will end in England and Wales as binding contracts are introduced earlier under government reforms by 2029.”
Currently, a buyer and seller may agree on a sale, only for the seller to pull out because someone offered a higher price. There is no legal recourse for the gazumped buyer. The changes mean that once an offer is accepted, a binding conditional contract will be in place, preventing either party from walking away without a legitimate reason.
Prime Minister Sir Keir Starmer said the current system leaves "people in limbo" and puts home ownership out of reach for some. "We're turning the page. Our reforms will bring this outdated process into the modern age, saving people time and money, and giving them the certainty they deserve," he said.
The plans also require sellers and estate agents to share more information upfront, including the property's condition and status in a chain, through so-called sales packs. The government estimates buyers will save about £650 on average.
The move echoes Home Information Packs introduced by a Labour government 20 years ago, which were later dropped by the coalition government. While widely welcomed by the housing sector, some have raised concerns about unintended consequences, such as properties taking longer to get onto the market as paperwork is prepared.
A new code of practice for property agents is set to be introduced this year, the timetable suggests. In Scotland, formally accepted offers are already legally binding, and sellers must provide home surveys. Under the Scottish system, solicitors exchange letters known as missives; if a party withdraws, they are liable for financial losses to the other party.
Previous attempts to improve the system have had limited success, and few of the latest changes will happen immediately. But the government says it is determined to turn the page on a process that has frustrated home buyers for years.