Selling or letting commercial property, perhaps more so with residential property, tends to have awkward moments when there are several bidders in the market at the same time.
The words “gazumping” and “gazundering” appear more often in the residential market and often the practices lead to frustration by the purchasers with blame often directed at the agent. What buyers fail to understand in a lot of instances is that the residential agents’ client, in a majority of cases, is the vendor who is usually keen to get the best price. Under the estate agents acts the agent must report all offers to the client (and in writing) regardless of when they are received, even if the property has gone under offer.
Most agents prefer not to get involved in “gazumping” if a higher price is subsequently received post a property going under offer but the ultimate decision rests with the client / vendor. This often creates an awkward position for the agent and frankly all parties involved. The agent has a more difficult and awkward position with the client when a prospective purchaser pulls out of a property but re-offers at a lower price or “gazunders” and this can often happen in a falling market. Perhaps the best solution would be to adopt the Scottish system where a bid, once accepted, is binding on both parties. This is a source for much debate in the industry.
These positions tend to happen less in commercial property albeit in a falling market there is a tendency for tenants to request rent free periods or reduced rents after solicitors have been instructed, especially if there are other factors to be taken into account, for example the condition of a property following a survey. Again an awkward moment for the agents and their clients!