Gazunderers thrive as UK deals fail
May 13 (Bloomberg) -- Max Andrews accepted an offer for his London apartment last December that was 16 percent less than his asking price, and then made a bid on another home.
Days before Andrews was scheduled to close, the purchasers said they would only buy at an even lower price, now 25 percent below the 285,000 pounds ($547,000) he'd originally wanted. The bid meant Andrews couldn't afford to move, so both deals collapsed.
``Everything fell through, leaving me stuck up the creek without a paddle,'' said Andrews, a 38-year-old art assessor. ``It was awful.''
Andrews joins the ranks of victims of ``gazunderers'': buyers who pull out of a purchase or slash the agreed-upon price at the last minute. The practice, which real-estate agents and lawyers say has grown in the last year, is a byproduct of the downturn in the British housing market.
Gazunderers feed on pessimism. The property market in London had the most widespread price drops in at least 14 years last month as banks cut back on lending, the Royal Institution Of Chartered Surveyors said today.
Property transactions in England are binding only when buyers and sellers exchange written contracts. Almost three months pass on average after an offer is made and accepted and before the formal exchange, according to government figures.
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