You found the property, negotiated a price, shook hands with the agent and went home confident the deal was done. Then the agent calls to say another buyer has made a higher offer and the vendor has accepted it. You have been gazumped.

Gazumping is one of the most frustrating experiences in Australian property — and it is entirely legal in most states. Understanding how it works and how to protect yourself is essential for any serious buyer.

What Is Gazumping?

Gazumping occurs when a vendor accepts a higher offer from a different buyer after already verbally agreeing to sell to you — but before a formal contract has been exchanged. Because verbal agreements are not legally binding in Australian real estate transactions, the vendor is free to accept a better offer right up until contracts are exchanged and a deposit is paid.

Is Gazumping Legal in Australia?

In most Australian states, yes — gazumping is legal. The rules vary by state:

• Victoria — no legal protection against gazumping before contract exchange. A vendor can accept a higher offer at any point before exchange.
• NSW — no legal protection before exchange. However, once contracts are exchanged and the 10% deposit is paid, the sale is binding.
• Queensland — contracts are binding once both parties sign, but this still leaves a window for gazumping during negotiations.
• Western Australia — verbal offers and acceptances are common and there is no formal cooling-off period for residential sales, making gazumping possible but less common due to different market conventions.

How to Protect Yourself From Gazumping

1. Exchange contracts as quickly as possible — the only real protection is getting to exchange. Once you have exchanged contracts and paid your deposit, the sale is legally binding.
2. Make an unconditional offer if you can — unconditional offers (without building inspection or finance conditions) are more attractive to vendors and reduce the time window for a competitor to swoop in.
3. Build a relationship with the selling agent — agents who trust you as a buyer are less likely to aggressively market competing offers to the vendor.
4. Have your finance pre-approved — buyers who are finance-ready can move to exchange quickly, reducing the gazumping window.
5. Use a property advisor — a Collings property advisor can manage the negotiation professionally, push for a rapid exchange timeline and ensure the selling agent understands you are a serious, capable buyer.

What to Do If You Have Been Gazumped

If you have been gazumped, you have limited legal options in most Australian states. Your options are:

• Make a higher counter-offer if you are willing and able to pay more
• Walk away and apply the lessons to your next purchase
• Seek advice from a property advisor on whether the competing offer is real or a negotiating tactic

How Collings Property Advisory Helps

Collings Property Advisory works with buyers to minimise the risk of gazumping by moving negotiations efficiently, preparing professional offers that instil vendor confidence and managing the agent relationship throughout the process. Our flat fee of $4,500 + GST covers the full advisory service from initial assessment to contract exchange.

FAQs

Can I sue a vendor for gazumping me?

In most Australian states, no. Verbal agreements to sell property are not legally enforceable. Only a signed contract with a deposit creates a binding obligation. This is why getting to exchange quickly is critical.

Is gazumping more common in certain states?

Gazumping is most common in competitive markets like Melbourne and Sydney where multiple buyers are often pursuing the same property. In slower markets, it is less common but still possible.

What is a lock-out agreement?

A lock-out agreement (or exclusivity agreement) is a written agreement between buyer and vendor that the vendor will not accept any other offer for a set period — usually 5–7 days — while the buyer completes due diligence and prepares for exchange. These are relatively rare in Australian residential transactions but can be negotiated in complex or high-value purchases.

Get Started

Worried about being gazumped or navigating a complex negotiation? Contact Collings Property Advisory for fixed-fee expert support.

$4,500 + GST Fixed Fee | collings.com.au/property-advisory