What is a property chain and how does it work?

There are a lot of confusing terms in the world of property transactions. And one phrase you’ve likely heard being thrown around is “property chain”.

Put simply, a property chain occurs when a group of buyers and sellers are interconnected through sales and purchases. For example, if you’re purchasing a home and the sellers need to buy another property – you’re now part of a chain.

Chains can quickly become complicated and confusing.

Let’s untangle chains and what they mean for you.

If you’re buying or selling a property, there’s a good chance that you’re going to be joining a property chain.

Imagine this, you’ve accepted an offer on your property and you’re looking to buy somewhere new, seems straightforward right? But wait, the sellers you're buying form also need o buy, and the people they’re purchasing from also need to buy.

Before you know it, you’ve got a whole chain of people relying on each other’s sales and purchases to go through smoothly. One hiccup along that chain, and the whole thing could wobble.

Long chains are less than ideal. They can be both time-consuming and stressful, but they’re a normal part of the house buying or selling process, being difficult to dodge unless you get lucky.

Let’s break it down: it all starts with an eager buyer looking to move, or a seller ready for a change of scenery. Either way, they’ll kick off a new chain or join an existing one.

From there, sellers need to find buyers, who likely have properties of their own to sell off. Those people then line up their own buyers, and so on – everyone’s transactions become connected and reliant on one another to progress the chain.

Your estate agent should be able to give you a full rundown on how many links are in your chain.

But at some point, that chain will inevitably “close” and come to an end. This typically happens when a first-time buyer enters the picture without a property to sell themselves. Or it could be someone at the top selling without plans to purchase another property.

Let’s walk through an example. Say you’re a first-time buyer purchasing from sellers who are upsizing to a bigger home. Since you don’t have a property to sell, the chain is complete when all the parties have offers accepted (on sale, purchase or sale and purchase).

On completion day, you’ll transfer your funds to your seller’s property lawyer, your transaction completes and then funds trickle up the chain so each transaction can complete.

No two property chains are the same. While we wish we could give you a simple, one-size-fits-all timeline, the truth is chains can vary dramatically in length and complexity. Whilst some are in chains with only 3 links, others could be tangled in a chain of 10 or more.

On average, typical UK home moves take around 3 to 6 months from start to finish. But remember, your specific journey could be quicker or take a little more time to unfold.

There are a lot of moving pieces when buying or selling a property, check out our conveyancing timeline for more.

A property with ‘no upward chain’ means that it is being sold by someone who doesn’t need the funds to purchase another property – making for a far smoother, less stressful process on your end as the buyer.

There are a few common scenarios where you’ll encounter no upward chains:

• The property is a second home or rental property
• The sellers are moving in with someone else
• You’re purchasing an inherited property

If you’re a buyer and you get lucky enough to purchase with no upward chain, you can expect some great benefits. Say goodbye to stringent timelines – without having to wait for any sellers’ purchases to go through, your deal has more flexibility to proceed at a favourable pace. There is also less potential for delays, an ideal situation for a buyer.

Chain-free means exactly what it says – no other buyers or sellers to rely on before your deal can proceed. You’re free to power ahead without getting tangled up in other parties’ timelines and potential delays.

One common chain-free example is when a first-time buyer is purchasing a new build directly from a developer. With no previous owners muddying the waters, it’s a straightforward path to your new home.

If new builds aren’t your thing, then the pinnacle of a fuss-free, chain-free journey would be when a buyer has no property to sell, and they’re purchasing from someone who is simply moving out with no need to buy again.

Property chains are made up of links, each link represents a transaction in the chain. Each of those transactions will likely have an estate agent, conveyancer or solicitor, surveyor, mortgage lender and maybe more.

As you can tell, with so much going on for each transaction, there’s ample opportunity for delays, issues, and surprises. Because of the dependent nature of property chains, one thing going wrong for one transaction can impact the rest.

In most cases, any issues that arise can be solved relatively easily, getting the chain back on track and stable again.

That said, we’d be remiss not to address some of the common culprits behind extended delays or even full-chain collapses:

Buyer’s or seller’s remorse: Whether it’s cold feet or a better opportunity when a party wants out, it throws a big spanner in the works.

Failed mortgage applications: If a buyer’s financing falls through, it grinds their purchase to a halt and stalls the whole chain.

Survey shockers: Sometimes assessments reveal expensive repair needs or dealbreaker issues that spook buyers away. Find out what type of survey you need here. 

Gazundering: If a buyer is feeling cheeky and tries to renegotiate the price at the last minute for a lower price the whole chain can be delayed.

Gazumping: The reverse of gazundering, when a seller breaks the deal to accept a higher offer from someone else.

The domino effect: One delay can cause other delays, with transactions so closely linked someone else’s delay could impact your journey.

While you can’t control every link in the property chain, there are plenty of smart strategies to minimise disruptions and keep your own transaction as smooth as possible. Remember, you play a vital role – if everyone handles their part responsibly, far fewer chains would experience frustrating delays or collapses.

So, what can you do to keep your chain nice and sturdy? Here are some key techniques:

Open communication: One of the most important things. With so many parties involved, frequent updates, progress check-ins, and proactively addressing issues are essential. An uninformed chain is an unstable chain.

Realistic timelines: Set realistic timelines from the start and remain flexible where possible. Trying to rush things typically invites chaos. A bit of patience goes a long way.

First-time buyers: If you’re a seller and you’re looking to close the chain below you for a swifter move, you could hold out in the hope of finding a first-time buyer, but don’t count on this.

Managing paperwork: There’s going to be a lot of documents to read and sign. Returning paperwork promptly and keeping copies of every form, report, and document along the way allows you to quickly reference anything needed.

Getting your finances in order: This can go a long way. Be preapproved for your mortgage if buying, have cash reserves ready for other costs, and gather all the necessary paperwork and documentation upfront.

Surrounding yourself with the right professionals can make a world of difference in keeping your property chain running smoothly. As a buyer or seller, one of your biggest responsibilities is vetting and hiring clued-up experts to handle each aspect of your transaction.

We’re talking about experienced, reputable estate agents, seasoned conveyancers with a proven track record, and surveyors you can trust to provide a thorough, accurate assessment. 

Luckily, it’s easier than ever to research and compare potential hires. Check online reviews, browse their social presence, and evaluate communication models and tech capabilities – this should give you a strong idea of who is suited to you.

In an ideal world, bringing on the right team would be enough to let you kick back and relax. But realistically, even with a professional support system in place, you still play a pivotal role in the process.

Frequent and open communication with your team is key. Check-in regularly, ask how you can help move things along on your end, and be responsive to any requests or potential snags. Even seemingly small things like an outstanding document can unnecessarily slow progress.