When it comes to buying or selling a property, there are several terms that it’s important to understand — some of which refer to the “property chain.” So, what does chain-free mean when buying a property?
When you’re buying a property, it’s vital to be aware of all of the factors that can impact your purchase and potentially cause delays or the sale to fall through altogether. One of these things is the property chain, which we’ll go into more detail about below. But more specifically, this post will answer the question ‘what does chain-free mean when buying a property?’
What Is the Property Chain?
A property chain tends to be one of the biggest causes of frustration when you’re buying or selling a property. It arises when buyers and sellers are linked together when they depend on each other’s successful sale to complete their own property transaction. If one person in the chain pulls out or runs into problems, it can break the entire chain. This situation is a source of substantial stress and disappointment for many buyers. Not only could they miss out on a property they have fallen in love with, but their chances of getting a satisfactory price for their property could be hindered.
Are Property Chain Issues a Cause for Concern?
In short, yes. One in five failed property sales in the UK are due to buyers being unable to sell their homes. In cases such as these, buyers lose substantial amounts of money from unrecovered conveyancing, valuation(s), surveys and brokerage costs. In 2017, government figures showed that homeowners lost over £500m a year because of failed home sales. If you are a developer and your buyer decides to pull out, your entire project can be delayed and make it difficult to attract more buyers.
What Does Chain-Free Mean When Buying a Property?
“No onward chain” are the three magic words every buyer wants to see when it comes to purchasing a property. Chain-free means the property you want to buy isn’t reliant on the successful purchase or sale of other properties. As a chain-free buyer, you are not dependant upon the sale of a property you currently own. For example, all first-time buyers are chain-free buyers.
What Are the Benefits of Being a Chain-Free Buyer?
As we mentioned above, the property chain can prove to be one of the most stressful and frustrating aspects of the housing market. All it takes is one link to falter, and you can be back to square one. For this reason, being a chain-free buyer avoids the anxiety of being dependent on another party to ensure you can complete the sale — and also makes you more appealing to sellers as they won’t have to deal with the hassle of the property chain.
The latter is crucial as it can be a contributing factor in buying a property for a price that accommodates your budget while avoiding the pitfalls that can arise when you find yourself on the property chain. Purchasing a property is a big decision involving a lot of money, so you need to have as much control as possible. A chain-free purchase provides you with more peace of mind and ensures your sale won’t fall through due to circumstances that are completely out of control somewhere along a property chain.