When you’re looking to buy a property, you may come across a listing that says “under offer.” This can be confusing, especially if you’re not familiar with the real estate jargon.
So, what does “under offer” mean?
In simple terms, it means that a buyer has made an offer on the property and the seller has accepted it. However, the sale is not yet finalized. This is because there are still some conditions that need to be met, such as obtaining financing or getting a satisfactory building inspection.
Until all of the conditions are met, the property is still technically for sale and the buyer is not guaranteed to purchase it. This is why it’s important to understand the risks involved in making an offer on a property that is “under offer.”
There is always the possibility that the seller will accept another offer and you will lose the property. However, if you are confident that you are the best buyer for the property, it may be worth the risk.
Here are some of the most common conditions that can be attached to an offer on a property:
- Financing approval: The buyer must be able to obtain financing for the purchase of the property. This condition is usually required, as the buyer will not be able to close on the sale without a mortgage.
- Building and pest inspection: The buyer must have a building and pest inspection done on the property. This is to ensure that there are no major structural or pest problems with the property.
- Homeowners insurance: The buyer must obtain homeowners insurance for the property. This is to protect their investment in case of any damage to the property.
- Clearance from the buyer’s lender: The buyer’s lender may require them to obtain clearance before they can purchase the property. This is to ensure that the buyer can afford the monthly mortgage payments.
If any of the conditions on an offer are not met, the buyer can withdraw their offer and the property will go back on the market. However, if all of the conditions are met, the property will be considered “under contract” and the sale will be finalized.
It is important to note that a property that is “under offer” is still technically for sale. This means that the seller is free to accept another offer if they receive one that they prefer. If this happens, the original buyer will be notified and they will have the opportunity to match the new offer. If they do not match the offer, they will lose the property.
As a buyer, it is important to be aware of the risks involved in making an offer on a property that is “under offer.” There is always the possibility that the seller will accept another offer and you will lose the property. However, if you are confident that you are the best buyer for the property, it may be worth the risk.
Here are some tips for buyers who are considering making an offer on a property that is “under offer”:
- Do your research. Make sure you know as much as possible about the property, including the condition of the property, the neighborhood, and the market value.
- Be prepared to act quickly. If you make an offer, be prepared to move quickly if the seller accepts your offer. This may mean having your financing in place and being ready to close on the property quickly.
- Be realistic about your offer. Don’t overbid on a property that is “under offer.” If you make an offer that is too high, the seller may accept another offer instead.
- Be prepared to walk away. If you make an offer on a property that is “under offer” and the seller accepts another offer, be prepared to walk away. It’s important not to get emotionally attached to a property that you’re not sure you can get.
By following these tips, you can increase your chances of successfully buying a property that is “under offer.”