What Does “Under Offer” Mean in Property?, by Matt Stevens
Whether you’re buying or selling a property, it’s inevitable that you’ll come across some unfamiliar terminology that’s specific to the housing market. All estate agents conform to legal vocabulary which is standard in their field, and this can make it confusing for potential homeowners in particular.
One such term that frequently appears is “under offer”. For example, you may see a certain desirable property and immediately start thinking about buying it. However it’s currently listed as being ‘under offer’, causing you to abandon any initial purchasing hopes you had.
The crux is that if a property is under offer, then this doesn’t necessarily mean that it’s now off the market, despite what people commonly believe. So that you can gain a deeper understanding on the matter, we’ve put together this piece which comprises all the relevant details you should know about this stage of the purchasing process.
What does it mean when a property is “under offer”?
When a property is described as being “under offer”, this generally means that a prospective buyer has placed an offer which the seller is presently considering. It could be the case that the seller has received multiple offers or that an offer under the asking price was placed, and so they’re taking time to deliberate.
On the other hand, select estate agents will use the “under offer” tag for when an offer has been accepted, albeit no contracts have been exchanged yet. In this way, regardless of the approach taken by the estate agent, “under offer” does not signal that a legally binding sale transaction has been made.
What is the difference between under offer and sold STC?
Another label often used by estate agents is “sold STC”, or “SSTC”. Both stand for ‘sold subject to contract’ and indicate that a buyer’s offer has been accepted by the seller of a property.
Although, again, this doesn’t go to say that the house or flat won’t ever be back up on a listings page. Reason being, that a “sold STC” marking does not imply that the buyer and seller have reached the legally binding stage of the sale procedure. Rather, at this point, it’s likely that conveyancing is being carried out alongside other checks, a point in the whole process where it’s not uncommon for a deal to fall through.
Despite this, a property that’s labelled “sold STC” shows that things have moved more far ahead than if it was “under offer”. Namely, “sold STC” differs from “under offer” in that the former means the acceptance of an offer, whereas the latter does not.
Can you view and make an offer on a property that is already under offer?
Yes, buyers which are interested in a property that’s “under offer” can request viewings and present a figure, given that no contracts have been exchanged, consequently meaning that the seller isn’t legally bound to finalise the sale. Technically, until there have been formal reviews and subsequent signings undertaken by each party’s solicitors, the property is still obtainable.
Likewise, even if a property is listed as “Sold STC”, people can submit offers in an attempt to outbid another buyer who has had their offer accepted previously. This is what’s known as ‘gazumping’ and though it is legal, many regard it as inherently unethical because it means that a buyer misses out and may be left with non-refundable fees for a solicitor and survey etc.
Moreover, a lot of estate agents are reluctant to permit offers and will limit viewings if a property is “sold STC” or “under offer” so as to protect the ongoing transaction’s stability. Still, it remains that if you can put forward a substantial offer which exceeds the existing one that’s been agreed upon, then it’s fair game. On the flipside, if you wish to avoid getting gazumped, you can always ask the estate agent to delist the property being sold to decrease the chances of this happening to you.
How long does a property stay under offer for?
There isn’t a defined time period for how long a property can be “under offer” for. Instead, it’s dependent on how much time the seller needs in order to fully consider an offer before accepting it.
Afterwards, there is still a great degree of the buying process leftover to be completed where inefficiencies can occur. Followingly, it can take weeks or months until a purchase is finalised from the date where the property was set as “under offer”.
Therefore, you might have quite a bit of room to get a better offer in. However, if both the buyer and seller are eager to get the deal done, then a property won’t stay “under offer” for long. Pertinently, it can take between 8-12 weeks for a property which has been sold STC to become legally sold.
What does under offer mean in Scotland?
The usage of the term “under offer” in Scotland differs fundamentally as compared to in England. Specifically, when a property in Scotland is listed as being “under offer”, this means that the buyer’s solicitor has made an offer on behalf of their client, and that the seller has accepted their offer in writing. This owes to the strict rules put in place by the Law Society of Scotland.
Accordingly, there is no “sold STC” stage extant in Scotland, rather sold subject to conclusion of missives (STCM). These missives comprise legally binding paperwork needed to sell or purchase a property in Scotland and are what solicitors are working towards when the “under offer” label has been used.
Comparatively, the meaning of “under offer” is a bit more ambiguous in England’s purchasing process. As a result, gazumping is seen a lot less in Scotland, owing to how an individual would have to drop their solicitor if they wanted to accept an alternative offering. Still, gazumping can happen in Scotland, even if it requires more convincing.
When should you make an offer on a property?
The ideal point for when you should make an offer on a property is when you’re wholly prepared. Being sufficiently prepared when you make an offering for a property works to significantly increase the chances that you’ll secure it.
This is due to how it shows that you’re serious about buying the house or flat in question, and that the sale will likely continue unimpeded by any external factors. One primary way to prepare yourself for making attractive housing offers is by applying for a mortgage in principle, or better yet, having an approved mortgage loan ready to go.
It’s easy to arrange a mortgage in principle, and if you do it through a mortgage broker such as ourselves, then you’re guaranteed to get a faster response than if you went to a high-street lender.
What’s more, we at The Mortgage Genie will talk you through everything you need to know so that you can search for properties confidently. Additionally, when you eventually come to get a mortgage, we’ll guide you through the entire process from beginning to end to ensure you get the best mortgage product for your individual situation. For further information on how we can help you to get a spot on the property ladder, be sure to get in touch with our team of expert mortgage brokers at 01915809890. And why not see how much you could borrow up to today by using our mortgage calculator?