Don't know if "gazundering" has started in CT yet? (or whether it's legally possible?)
Gazundering is defined as follows:
Gazundering is the practice of demanding a reduction in price to secure the sale of a property. This is usually done during contract negotiation. The timing of this demand is usually intended to prevent the seller from rejecting the lower price, as the sale could collapse if they did, although it may also reflect a genuine downturn in property prices in an area.
It's legal in England:
Under English law, the price you agree on is not definite until the `exchange of contracts'. Up until that time (usually 6 - 8 weeks after the seller accepts your offer for the property), the seller can choose to cancel the sale and accept a higher price from another buyer (if the market is moving upwards). Likewise, you have the right to cancel the agreement and buy a cheaper property (if you feel the price you originally offered was too high, or that prices may be falling.)
Any legal eagles out there know if it's allowed in SA? I have a feeling it isn't but confirmation would be nice.
3 comments:
Not a lawyer , but just thinking of the process - noramlly once the seller accepts the offer t is binding , so a question arises at which point you would demand a lower price...Only time I can imagine is if one of the suspensive conditions were not met , meaning contract lapses , then you could negotiate a new one... Looking forward to a legal view
We were led to believe that the price you see is the price you pay. Then we found out anything is open to negotiation but every new negotiation means a new contract.
The offer to purchase is binding on the seller and buyer once signed by both. Neither can resile without the other's consent. So Gazundering is not applicable in SA. Hence always make an initial offer that is really low since you can move up from it - but not down!!
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