Property Chains Explained

If you’re looking at buying a house, you’ll probably have come across the term ‘property chain’, particularly in reference to a property being ‘chain free’.

Property Chains Explained

What is a property chain?

The term refers to the situation in which the sale of a house depends on whether or not the buyer has managed to sell their house. Most of the time, people need to first sell their house in order to fund the purchase of their new house. 

For example, you may be selling your house, but the buyer needs to first sell their house to fund the purchase of yours. Their buyer may also be waiting on the sale of their house in order to purchase the buyer’s house, meaning the buyer can’t buy yours until the initial transaction has gone through. 

The longer the property chain, the more complicated the process can get.

What are the risks of a property chain?

Regardless of the size of the chain, the whole chain is at risk if one party pulls out of the sale. The more parties involved, the larger the risk. There are a number of reasons why one might not be able to complete a deal, thus pulling out of the sale. These include:

  • A party may decide not to move house after all

  • A selling party may receive a better offer

  • A buying party is having issues with their mortgage lender

  • Agreed dates are delayed

What is gazundering and gazumping?

Gazundering refers to a buyer reducing their offer at the last minute, whereas gazumping refers to a seller accepting a higher offer elsewhere at the last minute.

Both are legal, but they can have a negative impact if they’re involved in a chain.

Can legal assistance help?

Before anything else, we will make sure that you are definitely happy with the deal before agreeing to it. We work hard as conveyancers to keep everything on track, which reduces the risk of delays in a property chain. It’s imperative that each party involved in the deal communicates with each other to ensure everyone is aware of what is happening at each stage.

Each party should also work as hard as possible to complete their work quickly. We’re here to make sure your part of the deal is held up, to avoid the risk of disappointment that accompanies property chains.