The proposed measures, contained in the Housing Policy Into the 21st Century conference paper, would introduce a binding commitment between the buyer and the seller as soon as an offer on the property is made.

That would end gazumping, which is where buyers or sellers can pull out of a deal right up to the moment of completion.

'Buyers losing out'

The Lib Dems also want to introduce "merchantable quality" rights, which already covers most goods and services, into the housing market to give consumers rights in law.

Adrian Sanders: Wants to protect buyers and sellers

The party's housing spokesman Adrian Sanders said: "Buyers are losing out under the current law.

"A house or flat is the largest single purchase most of us ever make and probably the most stressful. Huge sums of money have to be spent on surveys and legal fees even before a binding contract is signed.

"Buyers lose hundreds of pounds if they are gazumped. The cost of a bad survey can run into the thousands."

The legislation would strengthen current laws said Mr Sanders.

A binding commitment already operates in Scotland.

The introduction of "merchantable quality" rights would give buyers a more effective redress against surveyors who fail to spot problems with fixtures, fittings or structures.

Another proposal in the conference paper is for opening up the conveyancing industry to end the current "near-monopoly" and "slowness" of the legal profession.

Mr Sanders said: "These measures would go a long way to reduce the stress involved in buying a property, ensure that buyers only incurred minimal costs ahead of a legal agreement and effectively make gazumping illegal."