A property chain is made up of two or more linked property sales.
Unless you’re a first-time buyer, moving house will usually require both a sale and a purchase. The person you’re buying from is also likely to be buying another property.
There are few things in life as stressful as a property chain when buying or selling a house.
Unfortunately, chain issues affect a significant number of house sales and cause many sales to fall through before completion. Even sales that do go through successfully can experience frustrating and unnecessary delays as a result of chain hold-ups.
This guide will explain how to navigate the hassle and uncertainty of property chains and explore what happens when chains break down.
Buying a house with a chain can be complicated and uncertain, but it is incredibly common.
If you’re keen to avoid it, you can make yourself chain-free by selling your property and moving to rented accommodation before you purchase another. Alternatively, you might consider selling to a professional home-buying company.
Selling your property to a professional home-buying company can take a lot of the hassle and uncertainty out of selling a property. It also makes you a chain-free buyer, which will not only reduce the chances of a chain collapsing and speed up your purchase, it will also give you better negotiating power when making an offer on your next property.
What does chain-free mean when buying a house?
‘Chain-free’ buyers and sellers are rare and in high demand.
When someone is ‘chain-free’, it means they have no other sale or purchase connected to this property transaction. Chain-free property transactions are usually quicker, smoother, and more likely to complete successfully.
Why do chains sometimes collapse?
Any property sale or purchase that is part of a chain is precarious.
Ultimately, the more properties in the chain, the more opportunity there is for someone to pull out and disrupt the entire process for all involved. Many estate agents will avoid talking about failed sales, but around one-in-three property sales will fall through before completion.
Common reasons for chain collapse include:
Difficulty getting a mortgage
Issues identified in a property survey
Slow progress on a house sale
Buyer or seller tries to renegotiate after a sale has been agreed
Buyer or seller simply changes their mind about proceeding with the move
What happens if my chain breaks?
When a house chain breaks, it puts every sale in the chain in jeopardy. If you find yourself in a chain-break situation, your property sale and purchase may still be salvageable. To keep your move on track, the lost party will need to be replaced quickly. If that’s not possible, you may need to start the property sale and purchase process all over again.
What can you do to keep your chain moving?
Communication is very important when you’re trying to keep your chain moving and minimise the probability of it collapsing. It’s important to respond quickly to any queries from your solicitor. You should also keep in regular contact with both your buyer and seller, via your solicitor, about how their sale and purchase are progressing.
Average property chain length
There is no official data on the number of properties in the average chain. The minimum will be three, but there can be 10 or more parties in a property chain.
How many property sales fall through due to chain-break?
Around 18% of failed property sales are caused by chain-break, which equates to around 50,000 property sales each year.
What to do when a property chain breaks
If your property sale has fallen through, either because your buyer has pulled out or because there has been a collapse further down the chain, and you’re determined not to lose the property you’re buying, there are things you can do.
Firstly, make contact with the owner of the property you are buying and explain the situation. Make it clear that you are still very keen to continue with the purchase of their property.
Once you’ve reassured the owners, you’ll need to try to secure another sale for your property as quickly as possible. You have a couple of options:
Pricing the property very competitively should help to attract a buyer quickly. However, it is important to keep in mind that it will take a minimum of 2-3 months to sell a house from the point of accepting an offer. It won’t be an overly quick process, and there is a risk of the sale falling through for a second time.
A chain-break company (also called a home-buying company) will be able to step in and keep your property chain together. They can complete a sale in as little as a week. As a business, a chain-break company cannot pay full market value for the property they step in to purchase, but each party in the chain will usually be willing to share the cost between them by adjusting their sale price. This enables everyone in the chain to proceed with their move and avoid the cost and hassle of having to go through the entire process again.
They say moving house is one of the most stressful things you can do. A large part of that stress will often come from the precarious and unpredictable nature of being part of a chain.
Good communication, prompt action and a proactive conveyancer are key, but if you can’t afford to take the risk, or you’ve already had a sale fall through as a result of chain-break, there are professional services that can step in and help.
If you’re worried about your chain, Quick Move Now could provide a free, no-obligation cash offer for your property. Call our friendly, helpful team on 0800 068 3366 for more information or enter your details on the website.
As an integral part of the marketing team, Beth is responsible for creating Quick Move Now’s external communications and dealing with national and regional press enquiries. View Beth's full profile
