CONVEYANCING

Property Chains FAQs

A property chain is a series of linked sales & purchases where each transaction is dependent upon the other. The key definition of a chain is ‘dependent’. This means that each transaction HAS to coordinate to simultaneously complete things like move dates, new mortgages and so on. In short, apart from the person at the bottom of the chain, each buyer/seller HAS to sell their existing home in order to buy their new home. This dependency is what creates problems with chains (and particularly when they break).

Probably yes – properties in a chain may well have mortgages. Property chains exist because each transaction is dependent on the next (usually because it is everyone’s PPP (principal private residence)). They will also probably each have existing and planned new mortgages, plus deposit money coming up the chain. All of this needs to sync to work.

The person at the bottom of the chain will normally pay a 10% deposit to the seller of the ‘first’ home. That seller (of the first home) can allow their solicitor to utilise the deposit being paid to them on account of actual cash for their own expected 10% on their own purchase. This principal can apply all the way up the chain without 10% cash necessarily being paid on each and every transaction on exchange of contracts in the chain.

Yes – almost always. Where a dependent chain exists, they will all exchange contracts on the same day – and usually set a completion date (the day you move) for the same date too.

There is nothing much you can do to manage the chain you are in except be ready with your own move. The only thing you can do is ‘break the chain’. This is feasible for very few of us normally as we are dependent on selling our current home to finance our new home.

Yes, you can break the chain. It all comes down to money as you will need to purchase your next house without selling your current home. This means raising finance independently of your current home and borrowing.

You can avoid a chain below you by ensuring you are not needing to sell your current home to buy the next. You do that by:-

  • Selling first (and eg going into rental)
  • Raising finance against your current home
  • Having enough money put aside in any event (ie not needing to sell your current home to finance your new one)

This removes a chain below you. You can not avoid a chain above you other than buying a property where there isn’t one (eg where someone has died).

A chain free property is where the person selling does not have an ‘ongoing dependent purchase’. This might be for example a probate sale.

The top of the chain is the last property where the person(s) selling do not have an ongoing dependent purchase. A common example of this is older seller’s going into care, or perhaps a probate sale.

The bottom of the chain is the first property. It may often be for example a first time buyer will not have a ‘dependent sale’ of their own.

Property chains fail because one or more party in the chain can not or will not sell/buy. For example their own sale may fall through, they may have a change of circumstances, or they may simply get cold feet and change their minds about moving.

Estate agents tend to describe a chain as complete as when everyone from top to bottom of the chain has sales/purchases agreed. In reality of course, any conveyance can fall through until (and after) exchange of contracts. As such, a chain is only ever really ‘safe’ once everyone has exchanged contracts.

All related/dependent transactions will exchange on the same day, and set a completion date that is usually the same too. The reason for this is that each sale and purchase is financially and logistically dependent upon the other – so they all have to coordinate!

Exchange happens in a property chain from bottom to top.

Completion happens in a property chain from bottom to top.

How long is a piece of string. A good estate agent will help you choose a buyer for your property who looks most likely to be able to get through to ultimately buying the home you are selling. This is sometimes called a ‘strong chain’, and agents will be looking for buyers that are ‘ready to proceed’.

Ask your estate agent!  They can speak to other agents and solicitors up and down the chain and get a feel for what’s what. 

A typical exchange can take as little as 6 weeks with no chain – even less if you are not taking a mortgage! 

When there is a chain, getting to exchange of contracts can be very frustrating.  However promptly you and your conveyancing solicitor deal with things, you can only exchange when EVERYONE in the chain is also ready to exchange contracts! 

Unfortunately, this is a ‘how long is a piece of string’ moment! There is just no telling what might be going on up or down your chain. People may be deliberately delaying things for their own personal circumstances. It can sometime be simple things like they want to exchange after a holiday, or something simple like that!

Your solicitor is bound by very strict professional conduct rules which means that the only people they can speak to in the chain is the solicitor on the transactions directly to do with you – ie your sale and your purchase.  They are strictly forbidden from speaking to any other solicitors or buyers or sellers anywhere else in the chain. 

Your solicitor is forbidden from talking to anyone other than the solicitors directly above and below your transaction because of strict professional conduct rules. 

If you want to know what is going on in the chain you MUST speak to your estate agent, NOT your solicitor.  Your estate agent has no professional conduct rules and so can talk to every agent up and down the chain to establish where the other transactions are at. 

Not really, no.  The only thing you can be is ready with your own stuff.  And when your solicitor tells you there is nothing they can do either – they’re telling the truth (unless they are using it as an excuse for some work they haven’t yet done)! 

Who knows!  One reason might be that their own client is keen to slow the chain down for personal reasons.  You may never get to know what those reasons are – but it happens all the time, and its hugely frustrating for everyone else in the chain – buyers, sellers, estate agents, and solicitors too! 

Invariably yes, chains will slow down the conveyancing process.  A chain is only as strong as its weakest link and if one party wants a delay until completion then there will be a delay until completion! 

Start all over unfortunately.  This is why people are reluctant to ditch slow buyers as getting a new buyer (and a whole new chain) in below you can be even less predictable than the buyer you already have!  

If you have more questions about property chains that this, or the other great content on our site does not cover then do please reach out!  Our team of expert conveyancing solicitors are here to help! 

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Property Chains

A property chain is a series of linked house sales and purchases in which each transaction is wholly dependent upon the other transaction (above and below it). The whole ‘chain’ of transactions can only happen in a coordinated fashion ie exchange of contracts can only happen once everyone in the chain is ready to do so (exchange contracts).

Property chains are perhaps THE most frustrating part of the whole conveyancing process. By their very nature, it is difficult for clear information to be made available about each and every transaction to every other member of that particular chain. It can cause all manner of frustration, and the key to surviving that is to make sure you choose the right solicitor and right estate agent to be on your side! Information is key, and if you know that your conveyancing solicitor and estate agent have everything done on your own transaction that can be.

Remember though, a chain is only ever as strong as its weakest link, so however quick your own conveyancing solicitor might be, until everyone in your chain is ready to go, you wont be able to exchange contracts!

Please check out our various posts and videos that explain property chains, what they are, how they work, and what (not much!) you can do to manage them!

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