What is a Property Chain?

A property chain refers to the connection of purchasers and vendors which pass through a chain. This is usually occurs when a party who is looking to purchase a property whilst the vendors are also looking to purchase a property following the sale. Either way, the various sales and purchases which pass through the chain are in some form dependant on one another. An issue with the chain could mean the transaction falls through, hence the importance of ensuring the chain keeps moving.

Please see the below example of a I typical chain:

• Start of the chain: First-time buyer who is buying their first property without a sale.

• Middle of the chain: The vendor who is selling to a first-time buyer and is buying from a retiree.

• End of the chain: Retiree who is selling to a homeowner and moving into a care  home.

The above example is a two-person chain as there are two purchases within the chain. The property chain commenced with a purchaser and ends with someone who is only looking to sell their property.

When in a chain type transaction, the date of completion must be mutually agreed by all parties and can only take place as and when they are all ready. If there is a chain, there may be a risk of delays.

When there is only one purchaser and seller, this is a no onward chain and neither party is reliant upon the other to complete. Many examples of transactions with no onward chain include:

• The purchase of vacant or repossessed property.

• Renting a property or moving in with someone following sale.

• First-time buyers.

How does a chain collapse?

A sale which falls through in a chain of transactions can be detrimental for the entire chain. The vendors may need to agree a new sale on their property and in doing so they may be unable to proceed with their purchase.

A property chain can collapse when:

• Someone withdraws from the sale or purchase.

• One of the purchasers has had their mortgage denied.

• The solicitor or agent has acted slowly.

• A property survey reveals issue making the purchasers withdraw.

Breaking the chain:

The best option is to always avoid a property chain but your solicitor will be able to assist with deciding on the best options.

One of the most common means in avoiding a chain from breaking is to arrange short-term accommodation to bridge the gap between selling your property and purchasing your new property. By doing so it will ensure that neither transaction is dependent upon the other.

When purchasing a new build property, there is no onward chain as the vendor is not looking to purchase another property.

Keeping a chain moving:

Please see our below tips to ensure your property chain does not experience any hiccups:

• Communication - This is the most vital tip as your agent or solicitor will be able to accurately confirm the status of the transaction and ensure there are no unexpected delays. This will allow you to keep on top of any outstanding tasks that may be required.

• Organisation - Ensure you have everything ready in advance. This includes your mortgage, deposit and other details to allow your solicitor to act in good time.

• Busy Periods - It may be worth avoiding busy periods such as the lead up to Christmas.

Considering the information in this guide, avoiding a chain cannot be helped sometimes. However, if the chain is kept moving, there should be little to no issue achieving completion.

If you have concerns or would like any further information. Please contact us for more help.