Chains and no dates?

[Confusedamerican]

As my name suggests, I don’t understand your home buying system. I’m the US if you make an offer on a house, it is binding. Exchange dates are set firmly. Sometimes a deal falls apart after a survey because negotiations over repairs fail, but that is really the point of no return. If either party tries to back out at the very least you get to keep whatever deposits have been exchanged and you can sue for damages.

The downside of this system is if you buy a house and your home doesn’t sell, you can be stuck paying for two homes. The upside is that home exchanges are firm. There isn’t any doubt. If you think you are moving, you are actually moving.

I guess my question is, why does the system let people back out so easily when prepping for a move requires so much effort and planning?

No idea. This system sucks.

We've sold to FTB. We agreed the sale in Feb. It took us 8 weeks to find a house that we wanted, and we agreed that sale on the 02 April. Since then, we've both had to pay land registry searches, and we also had to pay a structural engineer survey for condition of the mortgage. So far, we've spent approx £1,600.

Our vendors still haven't found anywhere to move to. They are now saying they will consider renting but they don't seem to be in a rush.

I'm terrified that our buyers will turn round soon and say "FFS, this is taking too long, we'll go elsewhere", or our vendors will say "we can't find anything, so we're going to stay put". In either scenario, we wouldn't get any of the money back that we've already spent!

I’ve bought and sold in an American style system and also in the English system. The American system is so much kinder to first time buyers. I barely spoke to my solicitor.

I’ve just sold & have never spoken to my solicitor or agent as much as I do here as it’s so inefficient. I ended up essentially forcing an exchange of contracts on Friday, whereas in the American system, exchange is almost a formality.

Yes, sometimes you end up with two houses but bridging finance is cheap because there’s more certainty over the sale of your former home.

The fact that anything can happen up to exchange is both a good and bad design feature of the English system, depending on which side of the fence you land!

Obviously if you are selling and your buyer pulls out last minute, that's it. You have no recourse to anything.

On the flipside if you're the buyer and your circumstances change you're grateful that you can indeed breathe a sigh of relief and pull out without too much penalty.

I was going to ask how the American system deals with the fact that you must still have chains of some kind form? I mean if you have to release funds from selling your house to purchase onwards, you need to sell yours? So is it just the case as Porridgeislife says people just get bridging finance? Or do chains form in the same way?

The Scottish system is the same as yours.

But English MNers are always on here complaining about our system!

I'm English, but I bought a flat in Hong Kong when working there. It was, I guess, similar to the US system? Once my offer was accepted, I had to pay 10% deposit and sign a preliminary sales and purchase agreement. Then everything was legally binding...sign actual sales and purchase agreement 2 weeks later and complete 4 weeks after that. A six week process. I wasn't in a chain there though, so I'm not sure what would have happened if I were? But then, I wasn't in a chain when I last bought in the UK either, and I was a cash buyer, and it still took a lot longer than 6 weeks. Just starting the process again...sigh...

@readytosell Chains do form but they aren’t true chains. Sometimes people will put a house under offer conditional on their own sale. You have so much certainty over your sale once a few days have passed after offer. Where I’m from, the only acceptable conditions to back out once 5 days has passed from offer is due to failing to secure mortgage finance or failing a survey/negotiations over survey problems.

Usually there’s two weeks between each completion in the “chain”. There’s none of this bonkers everyone moves on the same day stuff.

It’s also much quicker, usually 28 days from offer to completion. Searches are instant & online, and not at the whim of when Desmond when at the local council locates the right microfiche.