Chain-free property

Origins of the term

The term 'property chain' is common in real estate, especially in the UK. The chain is the line of people buying and selling. For example, there might be a first-time buyer trying to purchase a small flat, another person waiting to move from the flat to a small house, another person waiting to move from the small house to a larger house, and so on. If one person drops out of the chain, the sellers are not able to continue with their moves and the chain collapses.

Reasons for chain-free properties

Chain-free properties are available for numerous reasons:

• Homeowner reasons – the current homeowner has already a new home to move to, the seller is not buying a new home, emigration, selling on behalf of a deceased relative
• Financial institutions (lenders, banks and building societies) – after acquiring properties thorough repossession, probate or equity release, they are re-sold on the open market. As the seller is a company, not a private individual, there is no property chain.
• Home builders – properties that have been acquired in a part-exchange transaction and are being re-sold on the open market. As above, the vendor is a company, not a private individual, so there is no property chain.
• Professional Investors – properties that have been acquired as part of a portfolio, not for the owner to reside in, but as investments. Although a private individual, the vendor is selling for business reasons, not to enable them to move on, making the property sale chain-free.

References

References

1. (8 March 2006). "How to stop a house chain collapsing". The Independent.