The home selling journey is full of twists and turns. One of the most exciting moments is when, having listed your home and had viewings on it, you receive an offer or offers.
Sometimes a home might have lots of offers from different interested buyers. Sometimes there might only be one offer on the table. Either way, the process is the same.
You as the seller must decide whether or not to accept the offer. Let’s break it down:
What does under offer mean?
Under offer means that you, the seller, have received and accepted an offer from a buyer to purchase your property.
The offer might be the asking price you listed your home for. It might be higher or lower than the asking price. Either way, it’s enough for you to make a decision to accept it.
Your estate agent will have marketed your home, conducted viewings and come back to prospective buyers to ask if they want to make an offer.
Any offers will then be passed on to you to consider. This might be over email or over the phone.
At this point, you have to weigh up the position your would-be buyers are in. This might mean finding out if they’re selling a home of their own (so are in a chain), if they have a mortgage agreed in principle and the size of their deposit.
Once you have decided to go ahead with the offer, you’ll contact your estate agent to accept it and they’ll pass this information onto the prospective buyers.
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Does under offer mean a home is sold?
Accepting an offer does not mean your home has been sold, although you are one step closer.
Going under offer is a relatively early part in the selling journey and there’s still lots to do.
Both you and your buyer will need to work together to make sure that the sale reaches completion. Either of you can pull out of the sale before contracts are exchanged (more on which, later), although you risk losing money spent on the sales process if you do.
As the seller, you will usually appoint legal professionals to manage the transaction. There will be plenty of paperwork for you to fill out, too.
Your buyers will probably appoint their own legal professionals, commission a survey and ask the local authority to conduct searches on the location of the home.
Only after all this work is done and you exchange of contracts is the offer legally binding (although the process is different in Scotland, which we'll come to).
What’s the difference between under offer and sold subject to contract?
You might see listings flagged as either “under offer” or “sold subject to contract” on Zoopla or estate agents’ websites. Usually, they mean the same thing.
Generally, they both mean that an offer has been made and accepted. The reason it might say “subject to contract” is simply because contracts haven’t been signed yet.
As we explained above, it can take a fair while - weeks or even months – for a sales process to reach the point where contracts have been signed and exchanged.
Under offer might also mean that an offer has been made but not accepted by the seller yet. You might be considering an offer, but waiting for more viewings before deciding.
As a seller, you should ask your estate agent to make sure your home listing is flagged as under offer or sold subject to contract when you accept. This gives your buyer confidence that you’re not holding out for a better bid.
How long does a home stay under offer for?
The answer to this question varies depending on your sales process. A home may go under offer and then go back on the market if that offer is withdrawn.
If the sales process goes quickly it might be under offer for around six to eight weeks before contracts are exchanged.
If the sales process is slow (perhaps you or your buyers are in a chain, or there’s a problem somewhere), it might take anywhere from several months to even a year.
Is an accepted offer legally binding?
No. An offer on a home that is for sale is not legally binding in England, Wales and Northern Ireland. It is different in Scotland (more on which, below).
Either you (the seller) or your buyer may withdraw from the agreement to buy or sell the home at any point before exchange of contracts.
Any money you’ve paid on legal work or that your buyer has forked out on surveys, searches and solicitors is a risk. It might be that you or your buyer will pay for those services, only for the sale not to reach completion.
It’s important that both you and your buyer understand that sometimes the money spent preparing to exchange contracts - which can run into thousands – might be wasted.
It stands to reason that things change and if a home sale takes a while, the buyer or seller might change their minds.
Sometimes there will be problems with acquiring mortgages. Or a sale elsewhere in the chain will fall through and this has a knock on effect.
It’s one of those things that can be very frustrating and expensive.
Only at the point that signed contracts are exchanged by both the seller and buyers’ solicitors will the sale become legally binding.
If your buyer was to pull out after exchange of contracts they would be breaching their contract, which means they’d usually lose their deposit.
If you (the seller) decide to pull out after exchange of contracts, you will have to pay the buyer's costs including legal, mortgage and other fees.
Can I view a home that is under offer?
If an offer has been made and accepted on a home that is for sale your estate agent won’t arrange any further viewings.
If, however, viewings are already booked in when an offer comes in and is accepted, those viewings can still be honoured.
A seller might wait until all interested parties have viewed the home before formally accepting any offer. At this point the listing may be flagged as “sold subject to contract”.
In either case, you can always contact the estate agent handling the sale if you’re a buyer wanting to check the exact status of a home.
Sometimes (but rarely) a different buyer will make a higher offer on a home that already has an offer accepted on it. If the seller accepts the new offer, this is called gazumping.
What does under offer mean in Scotland?
The sales process is different in Scotland compared to the rest of the UK. Some of the sales process legwork is done before the home even goes on the market.
Before a home is listed the seller must pay for and organise a survey that is viewable by any interested buyers.
To make an offer on a home, a buyer must have a solicitor (a property law professional) and their offer is made via a letter.
This offer by letter is known as a “missive”. If the seller accepts this offer then the process is legally binding from the moment a “concluding missive” letter is exchanged.
There can be several “missives” and these letters are part of the negotiating process. Once both the seller and the buyer are happy with the terms, a “concluding missive” is exchanged – and this is the point at which the sale is legally binding.
It’s at this point that the rest of the legal process for the sale begins. If either party pulls out after this point, there will be a financial penalty.
Can a home that is under offer fall through?
Yes, a home that is under offer can fall through. If either the seller or the buyer decides not to go ahead before the exchange of contracts, there’s no legal or financial penalty (outside of Scotland).
In such cases, you can put your home back on the market and begin the process of viewings and reviewing offers again.