What is a property chain?

A property chain is a series of properties that are linked together by their buyers and sellers, who are completely reliant on one another, however far down the chain, for proceedings to go smoothly.

Possibly the best way to understand the problems, stress, delays and confusion that can arise within a property chain, and to truly appreciate the total reliance of everyone involved, on everything going to plan, is by way of an example:

Let us imagine then that…

…there is a first time buyer (1) purchasing a one bedroom flat from…

…a couple (2) moving into a small semi, as they are hoping for a child, currently occupied by…

…a large family (3) looking for more room in the shape of a five bedroomed detached house being sold by…

…an older couple (4) who are looking to downsize, after all of their children moved out, to a three bedroomed house which has been put on the market by…

…a couple (5) who are separating and using the money from the sale, to purchase two smaller properties from…

…a young professional (6), in a 2 bedroomed flat, looking to move closer to work into a city apartment owned by…

…a single woman (7) trading up to a large house owned by a widow moving into a home.

AND…

…the second smaller place for the separating couple (5) has been put up for sale by a young family (8) buying a house in an area with better schools from…

…a retired couple (9) who are moving over to the south of France where their new home is currently under construction.

The above chain involves 9 different parties, around about 20 individual movers and countless service providers such as estate agents, surveyors, lenders and solicitors.

In a chain like the one above there could easily be 50+ people, all with a crucial role in the dealings within the chain, and all with a crucial role in ensuring minimal levels of disruption to a large number of lives.

It is here where the problem lies. People make mistakes and forget things, people change their minds and get ill, people are, by their very nature, not very reliable.

Imagine for a second that things start to go wrong in the chain, for example, the couple who were separating (5) have a change of heart and decide to work on their relationship and take their house off the market, the potential impact on the lives of everyone else involved could be enormous.

Even something less drastic like a misplaced document, a neglected detail, or a deleted email can cause major delay and disruption to lives. It does not take much of an imagination to conjure up countless scenarios whereby the chain is broken or disrupted, causing huge amounts of unnecessary grief and stress for a great deal of people.

The most common reasons for a chain failing include the following: 

• A lack of communication between parties
• A simple change of mind
• Financial difficulties; particularly with regard to obtaining a suitable mortgage
• Legal delays; weekly reviews of cases can lead to extremely sluggish response and correspondence in light of a problem
• Surveys revealing problems prompting a fall through in proceedings
• The calling for further specialist surveys
• Unreliable workmen or tradesmen either not turning up or not keeping to the schedule
• The breaking down of a relationship leading to a couple pulling out of a deal
• Illness, job loss or any other personal, life changing occurrences

Possibly the most troublesome and frustrating thing about dealing within a chain is the fact that any problems are completely out of your hands, the progress of the chain is always limited by the pace of the slowest link and with the absence of a bird’s eye perspective of the process, establishing the point of weakness and encouraging them to resolve things quickly is extremely difficult.

Avoiding property chains

It is no surprise then that many of those that have been involved in a chain swear never to be involved in one again and, of course, it is advisable, where possible, to steer clear.

This is not always an option, but with the right preparation and research there are opportunities to be seized where there is no chain at all, or at least not a very long one.

One of the ways to avoid a chain is to buy directly from a developer with the offer of your property as part exchange.

Alternatively you could look on the market for a property that is already empty, allowing you to move in as soon as you sell your own property, putting you at the top of any chain and in more control.

Another option is to sell your property with the intention of going into short-term rented accommodation or staying with friends or relatives. This may mean that you have to put a lot of things into storage, but, it does put you into a position where you can, as a cash buyer, choose vendors with short chains, or vendors who are themselves prepared to move out and rent.

Even if you do find yourself in a chain you could avoid some of the uncertainty that comes with the territory by attempting to negotiate a move-in date with your vendor whereby they have to move out, whatever their circumstances, or the deal will be off.

However, it is not always as easy as all of that, and troublesome chains can seem to be unavoidable.

If then you do find yourself in the middle of a chain, or about to enter into one, understand what can go wrong, be prepared for setbacks and be persistent in your attempts to keep things moving forward.

And do not be afraid to pester as many people involved in the chain as you can, as some people need pestering!