While on your property search you've likely come across listings that boast "no onward chain", but what is an onward chain, and what are the benefits of purchasing a property without one?
Chains of transactions
An onward chain refers to when a seller is reliant on the sale of their current property to fund the purchase of their next home.
Many sellers will be in this position, and it can often lead to a chain of transactions, where the sale of one property is required for the purchase of another.
For example, person A needs to sell property A to buy property B, person B needs to sell property B to buy property C, and so on.
In the event that each transaction is completed in a timely matter, this should have little impact on your purchasing experience. However, there are still benefits to buying a property with no onward chain.
Why is no onward chain better?
The main issue with buying a property with an onward chain is the potential for delays and complications, which can worsen the longer the property chain is.
When there is an issue with any of the sales or purchases in a property chain it can have knock on effects for everyone else.
This could be something small like a paperwork complication that delays the process by a few days.
Bigger issues can occur when one of the purchases or sales falls through, breaking the property chain.
This could be due to a mortgage being rejected, a survey showing significant issues with a property, a buyer in the chain getting gazumped, or simply because someone chained their mind.
Can I avoid a property chain breaking?
Unfortunately, there's not much you can personally do to prevent a property chain from breaking as it's in the hands of the other parties.
Don't let this weigh on your mind though as typically there are few issues with being in a property chain, with two thirds of property chains not collapsing.
You should simply be timely and respectful, making sure you are on top of the sale of your home and the purchase of your next home to avoid being the weak link in the chain.
First time buyers are in an advantageous position as they do not need to sell an existing property to fund the purchase, so if it's your first time buying and want to avoid being in a property chain you should search for properties with no onward chain.
If you have any questions about the nature of property chains contact your local branch to talk with an expert adviser.
Will you need to sell your current property when you purchase your next home? Get started with a free property valuation, where you can get advice and guidance from a local expert with no obligation to sell.
Reeds Rains E-marketing Executive
