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In real estate, being gazumped means a seller has accepted your offer to buy their property but ditches it when a higher offer comes along. The practice of gazumping causes much heartbreak in the real estate world and happens more frequently in hot property markets when demand is high and prices are rising.

Getting gazumped can particularly sting when you have already paid for inspections, home loan application fees, and maybe even some legal costs. It is a bitter pill to swallow but there are some protections that can reduce the chances of it happening to you.

Is gazumping legal in Australia?

Yes, in most states and territories, gazumping is legal - or at least not subject to regulation. Queensland is the only jurisdiction that has tried to eliminate it.

In most parts of the country, if a buyer and a seller agree on a property purchase, the seller retains the right to accept higher offers until both parties have signed contracts of sale. In Queensland, a purchase agreement is legally binding once a buyer has made a formal written offer and the seller has accepted it. A final exchange of contracts is still needed for the sale to go through but at the acceptance stage, the seller is bound to honour the agreement, effectively locking out other prospective buyers from making further offers.

The ACT has also taken steps to make gazumping more difficult. There, a seller is required to have certain documents, such as title certificates, physically attached to most sale contracts, making it a little more involved to flick one offer for a better one.

In all other states and territories, it's game on until contracts have been exchanged and signed by both parties. Not surprisingly, the longer that process takes, the greater the risk for gazumping.

Gazumping Laws by State and Territory


Legal Status of Gazumping

Specific Regulations or Notes

New South Wales (NSW)


No specific anti-gazumping laws; contracts binding at exchange.

Victoria (VIC)


No specific anti-gazumping measures; contracts binding at exchange.

Queensland (QLD)


Contract binding once a formal written offer is accepted.

Western Australia (WA)


No specific anti-gazumping laws; acceptance until exchange of contract.

South Australia (SA)


No specific anti-gazumping laws; contracts binding at exchange.

Tasmania (TAS)


No specific anti-gazumping laws; contracts binding at exchange.

Australian Capital Territory (ACT)


Sale contracts must include certain documents, making it harder to change terms after an agreement.

Northern Territory (NT)


No specific anti-gazumping laws; contracts binding at exchange.

Who is to blame for gazumping?

It's difficult to apportion blame for gazumping. A real estate agent is legally bound to pass on all written offers to a seller. A seller is entitled to get the best price they can if it's not illegal to do so, and it's difficult to blame buyers for offering what they can to secure a property they're set on.

While it has long been argued gazumping is unethical and not entirely fair, the practice continues. So, here's how you can give yourself the best chance of it not happening to you.

How to avoid getting gazumped

Buy at auction

Unless you're buying in Queensland, there is generally only one sure way of avoiding getting gazumped and that is to put in a successful bid at auction. Once bidding has finished and the auctioneer has declared the proverbial "going, going, gone", the property goes to the highest bidder at the stated price. Because there is no cooling-off period for homes bought at auction, there is also no window for another buyer to step in and offer a higher price.

You also need to be aware there are a few risks with buying at auction. Because the sale is treated as 'unconditional' when the hammer falls, you are effectively locked into buying it and are obliged to put up a deposit that's non-refundable, even if you aren't able to get a home loan. Which brings us to…

Get pre-approval

Don't wait until you're making offers on properties to organise your home loan. Getting pre-approval for a home loan means a lender agrees, in principle, to lend you a certain amount of money. Pre-approved finance can give you confidence your home-buying aspirations are achievable and provides an indicator of what price range you should be looking at in your property hunting.

Having a pre-approved loan can also make you a more valuable buyer to a vendor but, importantly, it gives you a good head start on getting your loan formalised after a seller accepts your offer. Anything you do to reduce the loan approval process helps you avoid being gazumped while the funds come through and contracts can be exchanged. This also means being organised with your paperwork and responding promptly to communications and requirements of your lender.

Top owner occupier home loans

The table below features home loans with some of the lowest interest rates on the market for owner occupiers to get you started.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
Principal & Interest
Featured Online ExclusiveUp to $4k cashback
  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
5.94% p.a.
5.95% p.a.
Principal & Interest
5.95% p.a.
5.95% p.a.
Principal & Interest
5.99% p.a.
5.90% p.a.
Principal & Interest
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .

Don't go too low with your price

Another way to reduce your chances of being gazumped is simply not to go too low with your price if you're serious about securing the property. Do your research of the area and similar properties that have recently sold nearby. The seller and agent will likely have a price in mind but, understandably, will want to get the best price they can. If your offer is too low, it increases the risk of the seller, and the agent, being open to better offers. Offering a market-appropriate price can also make you appear a more serious buyer to work with.

Fast-track your building and pest inspections

Before proceeding with a sale, it's always advisable to get a building and pest inspection. Buying a home or investment property is likely to be the biggest purchase you'll ever make so it's important not to cut corners, even when time is of the essence. Make sure you have your services on stand-by to get their inspections done and their reports back to you as soon as possible. Some businesses offer building and pest inspections together although it's best to ensure there are two different specialists working in tandem to deliver them.

Get a copy of the contract ASAP

As we've learned, an agreement between a buyer and seller is not legally binding until contracts of sale are exchanged (except in Queensland). That's why it's important to get a copy of the contract as soon as you can to have your solicitor look over it. Contracts can be obtained from the real estate agent even before you make a formal offer. Much can happen over a weekend, or even a night, so any extra time you can save could make the different between securing the property and missing out on it.

Have your legal advice organised

Work with your solicitor or conveyancer to get to exchange of contract stage as soon as possible. Be organised, be responsive, and make sure you are ahead of the game when you get your legal advisor to look over the contract and be satisfied with what it contains.

Many solicitors commonly advise buyers to make contracts subject to finance and building and pest inspections as built-in safeguards. In any case, you should have your loan approval process and inspections well underway by that stage. Keep in regular touch with your solicitor or conveyancer and follow up if there are any delays. You may need to do some chasing to keep the process on track.

Be wary of relying on the cooling-off period

In their haste to secure a property and avoid being gazumped, some buyers may skip ahead in exchanging contracts, leaving mandatory cooling off periods as their only safety net in getting out of the contract should something go awry. This can bring its own risks.

Not every state has a cooling-off period after contracts of sale are exchanged.

State or territory

Cooling-off period*

New South Wales

5 business days


3 business days


5 business days

Western Australia

No mandatory cooling-off period, but buyers and sellers can add one to a contract.

South Australia

2 business days


No cooling-off period. Once the contract is signed, both parties are bound.

Australian Capital Territory

5 business days

Northern Territory

4 business days

*Correct as at May 2024

Where it applies, some buyers take the gamble that the cooling off period will buy them extra time for their finance to be approved, their building and pest inspections to be done, and their legals to be on track. But, ideally, these variables should all be ticked off before contracts are exchanged.

If something doesn't line up the way you expected, for example, you are turned down for finance from your first lender or the property has structural issues, you'll need to know that before the end of the cooling off period. At that stage, you can still pull out of the contract without penalty.

But if you only find these things out after the cooling-off period has expired, you can lose your deposit and/or be up for a portion of the contract price, generally between 0.2-0.25% depending on the jurisdiction. In worse case scenarios, the seller could even take legal action to force you to proceed with the purchase. It depends on the conditions set down in your contract and if a legal eye hasn't yet had a chance to look over it, that could be disastrous.

While it's not pleasant being gazumped, it can be far more stressful to take major risks in trying to avoid it. There will be other properties out there but any money you lose won't be coming back.

Related: Can you break a real estate contract?

Keep in touch with the real estate agent

By law, real estate agents are required to pass on any written offers made to the vendor until contracts are exchanged. If your offer is gazumped, assess whether you are in a position to make a better offer. (Maybe you can be a gazumper.)

If you are at the top end of your price range, be prepared to let the property go and keep looking. But it doesn't hurt to follow up with the agent to see if the offer that usurped you is proceeding smoothly. There are many variables that can stand in the way of this happening. At least let the agent know, in writing, what your highest offer is and that you are ready to proceed should that sale not go ahead. You have nothing to lose.

Image by Kaffeebart on Unsplash

Original article by Jackie Pearson published 4 July 2014