A broken property chain is one of the most stressful and annoying experiences for people looking to buy or sell property.
In many property deals, the various buyers and sellers are linked to each other, with one transaction often dependant on another. If one buyer or seller backs out of a deal, it can have disastrous effect on the whole chain.
For example, if you are waiting for a buyer to complete the purchase of your house before the deal goes through for your new house, and your buyer pulls out, this will scupper your deal, which will cause major problems for the vendor of your new property. And so on.
A broken property chain is a common problem. It is estimated than one in three property transactions in England and Wales falls through, around 150,000 property sales each year.
As well as being stressful and frustrating, it can be an expensive problem too, as the costs involved with hiring a surveyor, an estate agent and the various legal fees involved in property deals are non-refundable.
Why do property chains break down?
- Most property deals fail because buyers or sellers miss deadlines for the submission of paperwork, or their finance falls through at the last minute.
- On other occasions, the buyer can simply withdraw their offer for the property. Until contracts are signed and exchanged, the buyer is not legally obliged to buy the home, nor or they responsible for any of the costs you may have incurred in the process.
- Another common reason for deals failing is that the surveys, which are normally undertaken late in the buying process, may reveal a previously unknown problem with the property subsidence, damp, and so on.
- Gazumping, which is when another buyer beats your offer at the last moment. This may force you to cancel your own house sale.
- Gazundering. This is where a buyer thinks they can negotiate a better deal, and reduces their offer just before contracts are due to be exchanged. This is said to be more common recently, as the housing market cools slightly. While this practice is unethical, it is not illegal.