Sold with reservation, what does this mean?

sold under reserve

When you are looking for a house to buy, you will often come across the term "sold subject to reservation" on funda. This term indicates that an offer on a home has been accepted, but the sale is not yet final. In this blog, we will look at exactly what this term means and what factors can affect conditional sales.

sold under reserve
Sold with reservation

What does conditionally sold mean?

When a home is sold with a reservation, it means that the buyer and seller have agreed on the sale price and the terms of the sale. The buyer's offer has been accepted by the seller, but the sale is not yet finalized. There are still some things that need to be settled before the sale can be made final.

Financial reservation

There are several reasons why a conditional sale may be made. One of the main reasons is that the buyer has yet to arrange financing. This means that the buyer does not yet have a final commitment from the lender for the mortgage needed to purchase the home. In this case, the sale will be conditional until the buyer has obtained the mortgage and the financing is final.

On average, arranging a mortgage takes about 4 to 6 weeks. If the buyer does not manage to get the financing done within this period, the sale will be dissolved. The buyer does not have to pay a 10% penalty in this case because a penalty is specifically included.

Building inspection

Another common reason that a house is still under "conditional sale" is because a building inspection needs to be performed. A building inspection is an inspection of a house by a construction specialist to assess the technical condition of the house.

The purpose of this inspection is to provide the buyer with information about the structural condition of the house before he or she buys it. This allows the buyer to make informed decisions about purchasing the home and to address any defects or problems before he or she takes ownership of the home. In most cases, a certain amount is set for the reservation. This allows a buyer to state, for example: if the immediately necessary costs exceed €5,000, I want to be able to waive the purchase.

An inspection is often scheduled shortly after the purchase agreement is signed, usually within 14 days of the expiration of the cooling-off period. This way, a seller can move faster in case the sale is rescinded.

No-risk clause

For example, a no-risk clause can be included in a purchase agreement for a home where the buyer must first sell his own home before he can pay for the new home. If the buyer cannot sell his own home within a certain period of time, he can rescind the purchase agreement without having to pay a penalty.

In this case, the purchase of a home is completely dependent on the sale of another home. Therefore, the sales contract will stipulate the date and minimum purchase price by which the property must be sold to be able to dissolve the sale. Because a sales process can sometimes take months, in the meantime the home will be "sold subject to conditions.

How long can a house sold under reserve stand?

On average, this can take 4 to 6 weeks. When there is a reservation to sell your own home, this can take up to 6 months on average. At that moment there is an irrevocable sale, the status on Funda will change automatically.

This also means that the bid log can be released to the other candidates who have bid on the property.

Can you still bid on a house sold with reservations?

Although the sale is not yet final, there is a written agreement to which the seller is bound. As a candidate, you may certainly express interest and, for example, and ask for a spot on the reserve list, but you may not make an offer on the property.

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