We have recently seen a house which we have fallen in love with. Ours has now gone on the market, but we are frightened of losing the one we want to buy. Is there a way we can secure it while waiting for our property to sell which might take some time?
Sadly not – unless your seller is in no particular hurry. However, any seller who is willing to wait until you have sold runs the risk of being let down should you ultimately be unable to sell your property. A seller will, therefore, be advised to continue to market the property despite having accepted your offer in principle.
This means that if an alternative buyer either offers the same price or more, and is able to proceed immediately, then your seller may decide to proceed with the party who is best placed. One mutually beneficial way of dealing with the situation is to enter into an Option Agreement where, in return for a non-refundable payment, the seller agrees to “hold” the property for you until certain conditions are satisfied – such as an agreed sale of your own property.
The principle is based on the seller receiving some form of compensation at the end of the Option Period (usually six to 12 months) in return for agreeing not to consider any alternative offers. Once the Option Period has expired the seller is free to negotiate with any other buyer and keeps the Option Fee by way of compensation for his lost opportunity.
If, on the other hand, during the Option Period , the original buyer wishes to proceed then he simply exercises the Option and the matter proceeds with the Option Fee being taken into account as part of the ultimate purchase price. Option Agreements are however potentially complex and you must receive expert advice from a property lawyer before entering into one.