The story has remained fairly constant since June 2020; the property market is exceptionally busy, demand often outstrips supply and prices have increased at a steady rate.
Recently, the house price “full house”, where prices increase in all regions and market sectors, was recorded in Rightmove’s House Price Index.
For estate agents in Hull, where house prices have increased by 6 per cent over the previous year, one of the biggest complications they have noticed for buyers and sellers alike is the appearance of very complex property chains.
A property chain is the phenomenon where a buyer makes an offer on a property contingent on them selling their previous property, and if the buyer who wants to buy the first buyer’s property needs to sell their home that adds another link to the chain.
This continues until there is someone who is only looking to buy, but property chains can be very long, and any event far down the chain that could potentially delay the sale of a property can have far-reaching ramifications.
How fast a chain can progress depends on the slowest link, so avoiding lengthy chains has become so vital that people who can buy without the need to sell (known as “power buyers”) have a lot more leverage in negotiations than those needing to sell their homes.
Here are some times to avoid being trapped in a chain.
New-build properties are by definition the start of a property chain, and so you avoid being caught in the middle of a chain this way. Some developers will even offer an exchange part-exchange deal to help close the sale quicker.
Bear in mind you may not get the best price for your home in comparison to the market if you go down the part-exchange route.
One solution, if you are willing to risk being in rented accommodation for a while, is to sell your property first, being the end of one property chain, before buying a home as a chain-free power buyer.
You can also use this as a negotiating tactic, by trying to get the seller of a property you are trying to buy to agree to a deadline to move out, even if they are still negotiating a purchase of their own. In some cases, they will agree to avoid losing out on the sale.
Besides new builds, which have no upward chain, there are other cases, such as second homes or homes where the previous owner has vacated the property, where you can avoid a lengthy property chain.