On the blog today, we’re talking about what happens if a property you really like is under offer, and whether or not it is possible to offer on it. Maybe you’d been eyeing it up for a while, an offer has been made on it by someone else, but now you’re also in a proceedable position.
In an understandably delicate situation, what is the right (and legal) thing to do?
One of the many questions we are asked by buyers is “what is the difference between ‘under offer’ and ‘sold subject to contract?”
Often confusingly, they mean pretty much the same thing, and It just depends which term the estate agent handling the sale prefers to use. The phrase ‘under offer’ is generally only applicable when an offer has been accepted on the property, regardless of whether or not the asking price has been met, by the owner.
Thereafter, the property is deemed to be under offer and legally can be described as such, whether on the estate agent’s board or on websites.
So can you make an offer on a house that is under offer?
Many buyers insist that once their offer on a property has been accepted, the words ‘sold subject to contract’ should be used to describe the property and that it’s officially taken off the market.
The majority of estate agents will usually stop showing the property to other prospective buyers, but in cases where an offer in principal has been accepted but maybe the buyer isn’t in a proceedable position yet (i.e. still needs to sell themselves), the seller may still be open to viewings on their place.
The practice of ‘gazumping‘ – where a new buyer comes in with a better offer on a property that is already under offer – is not as common as it once was, but it still happens from time to time.
If you do have your heart set on a particular property and see that it is ‘under offer’ or ‘sold subject to contract’, you shouldn’t assume that it has been permanently taken off the market, as this often only happens officially at the point that contracts have been exchanged. That’s why you will still properties on Rightmove, Zoopla et al that are still listed but are labelled ‘Under Offer’ or ‘STC’.
As a buyer you can help prevent ‘gazumping’ by building a good relationship with your seller, and getting things moving ASAP. This means instructing a solicitor and getting your surveys sorted ASAP. You’d be surprised how many people put in an offer on a property, only to leave it a few weeks before doing anything, and then are surprised when the seller starts to get twitchy.
The dos and don’ts around gazumping are notoriously murky. In answer to our initial question of, ‘can I make an offer on a property that is under offer or sold subject to contract?’
The straightforward answer is yes, even if the property is already under offer, and as an agent we are legally obliged to pass on your offer to the owner. After that, the ball is in the seller’s court and it’s up to them to decide what to do.
If you have any questions regarding the above, or a property that you’re interested in, do get in contact with us for a chat on 020 8462 7155.