What does SSTC mean? Sold subject to contract explained

What does SSTC mean if you’re buying a house? Can the buyer or seller pull out or is the sale legally binding? And can you get gazumped if you’re buying a property that’s sold STC? We explain all.

Rebecca Gamble Consumer Journalist

Whether you’re buying or selling a house it’s vital you know what SSTC – sold subject to contract – means. Because while you might think the hard work is over now an offer has been accepted, sadly that’s not the case. There’s still a long way to go from SSTC to completion. What does SSTC mean for buyers? What does SSTC mean for sellers? What are the potential pitfalls once your property is SSTC and how can you avoid them? Let’s take a look.

What does SSTC mean?

SSTC – or STC – stands for “sold subject to contract” and means the seller of a property has accepted an offer from a buyer but the agreement isn’t yet legally binding. Once a property is SSTC it means both the seller and the buyer will start the conveyancing process and work towards exchange of contracts; this is the stage when the deal becomes legally binding. Until this point, the buyer or seller can pull out and there will be no legal repercussions.

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What does SSTC mean in terms of the price? It may be the case that the SSTC stage has been reached following negotiations on the price. However, renegotiations on the price may still happen when the property is SSTC. There could be a number of reasons for this, for example if a house survey flags up problems with the property such as damp the buyer may want to renegotiate. Bear in mind some estate agents might use the term ‘sale agreed’ instead of sold STC.

What does under offer mean?

According to The Property Ombudsman, ‘Sale Agreed’, ‘Under Offer’ and ‘Sold Subject to Contract’ all mean the same thing – that the seller has accepted an offer on the property but contracts are not yet exchanged.

What does SSTC mean for sellers?

For sellers, SSTC means you’ve accepted an offer from a buyer. Once the buyer’s proof of funds are confirmed you should request the property is listed as SSTC. It will still appear on property portals unless the buyer requests it’s removed and you agree. And a ‘Sold STC’ sign will replace the ‘For Sale’ one outside your home.

However, when you’re selling, there’s still work to do when your property is sold STC. For example, you will have a variety of forms, questionnaires and documents you’ll need to give the buyer with all the information about the property and about the sale. You can find out more in our guide Conveyancing process explained: For Sellers.

And you’ll also need to negotiate the draft contract via your solicitors. You and the buyer will need to agree matters such as the length of time between exchange and completion (this is usually 7-28 days after the exchange of contracts) and what fixtures and fittings will be included and how much they will pay for them.

What does SSTC mean for buyers?

So what does SSTC mean if you’re buying? If you’re buying a property, sold STC means that your offer has been accepted by the seller. It’s a huge step and it means you’re one step closer to buying your property but there are still lots of hurdles to get over first.

At this point you should instruct your solicitor to start work on your purchase. One of the first parts of the property conveyancing process involves your solicitor examining the draft contract and supporting documents and raising enquiries with the seller’s solicitor. As a buyer, you’ll need to go through the forms the seller has completed, including the TA6 form and let the solicitor know if you have any queries or concerns. Your solicitor will apply for searches such as local authority searches, water authority searches and check the flood risk.

This is the time to commission a house survey too. It’s an important step to if you want information about the state of the property before you are legally committed to buy it. Booking a survey early also shows you are a serious buyer. See our tips on how to find a surveyor.

Depending on the outcome of the searches and the survey, you may want to pull out or renegotiate on the price. Read more in our guide A bad survey report: What to do next.

When you’re a buyer and you’re asking “what does SSTC mean?” it’s important that you encourage the estate agent to mark it as a SSTC property listing as soon as possible. Or even better ask the sellers via the estate agent for it to be withdrawn from the market completely. This may prevent another buyer making a higher offer and ‘gazumping’ you – read on for more on gazumping. This is also the time that you may want to consider getting Home Buyers Protection Insurance.

Can I make an offer on a house that is SSTC?

So what does it mean if a property you’re interested in is listed as Sold STC. Can you still make an offer or have you missed the boat? The answer is that even if the property is SSTC you can still make an offer. And an estate agent is legally obliged to pass on any offers they receive to the sellers unless they have asked them not to. When another party makes a higher offer on the house you are in the process of buying and has that offer accepted this is called gazumping (not to be confused with gazundering).

In most cases gazumping happens because a higher offer has been made. However, in other cases timing could be an issue. For example, if you’re taking too long to have a survey, sell your home or if your solicitor is dragging their feet, the seller may decide to reject your offer in favour of one from a buyer who is in a better position to move more quickly.

Since the exchanging of contracts comes fairly late in the sales process – after the buyer has spent money on surveys, arranged a mortgage, paid the conveyancer for local searches – buyers often find themselves seriously out of pocket if they are gazumped late on in the process. (This isn’t the case in Scotland where there is a different process for buying a house). This is why we recommend Home buyers Insurance to provide cover in the event your purchase falls through.

However, if you do spot a property you’re interested in, even if you don’t plan to gazump another buyer, you can register your interest in the property with the estate agent in case the sale falls down when it’s SSTC. And it may well be worth your while doing this. According to Rightmove about ‘15% of Sold STC or under offer properties come back on the market after the sale has failed to proceed’.

How can I avoid being gazumped?

When you’re considering what does SSTC mean for you as a buyer there are steps you can take to protect yourself from some of the pitfalls, including:

Getting insured

If another buyer comes in with a much higher offer than you, you can’t stop the seller accepting it. But you can protect yourself against some of the financial losses if this happens by taking out home buyers protection insurance. Then if the sale falls through because the seller pulls out you’ll be able to claim back some of your conveyancing fees, survey fees and any other costs you may have had to pay out.

Be prepared and act quickly

Before making an offer (assuming you’re not a cash buyer) make sure you have a mortgage agreement in principle in place. Line up your solicitor and get all of the necessary documentation to hand. And once your offer is accepted, keep in contact with your mortgage broker and conveyancing solicitor to keep the pressure on and ensure your case doesn’t fall by the wayside. Also, make sure you respond quickly to requests for information. Once contracts are exchanged, the agreement is legally binding, so you want to get to that point as quickly as possible.

Ask for the property to be taken off the market

Sellers are not always keen to do this but it’s worth asking them to take the property off the market once your offer has been accepted. If the property is no longer being advertised, there’s much less chance of a higher offer being made and you being gazumped. You’ll have more luck if you offer something in exchange to show your commitment such as getting your survey undertaken as soon as possible after the offer has been accepted.

Arrange your survey — find and get quotes from local chartered surveyors now

Can you still view a house that is sold STC?

Again, yes. There is no reason why you can’t view a property that is sold STC if the seller is happy for you to do so. However if you’re selling this is a risky business. We know of one case where a seller was allowing viewings of a SSTC property and the original buyers turned up in the middle of the viewing and realised what was happening. So be aware there are risks if you have accepted an offer from a buyer already.

SSTC: Can the seller change their mind?

Yes. The seller is perfectly entitled to change their mind after accepting an offer. The sale will only be final once the contracts have been exchanged.

Can a property sold STC fall through?

Properties sold STC can and do fall through for many different reasons including:

• Problems highlighted in searches or the house survey
• The buyer being unable to secure a mortgage
• The chain collapsing

The best ways to reduce the chance of this happening is for both buyers and sellers to be clear on whether they’re in a chain of if they’re a cash buyer. Sellers should also be clear about any problems with the property upfront to avoid problems being discovered at a later date. Also, the best way to avoid a sale falling down is to make sure it goes through as quickly as possible. Read our guide on How to speed up conveyancing.

How long from sold STC to completion?

According to Rightmove’s latest figures it currently takes an average of 150 days from the time a home is marked “sale agreed” to reach completion – that’s over 21 weeks.

However, this will vary depending on factors like how quickly the solicitors work, how long the searches take to come back and how long it takes to arrange your mortgage. The length and complexity of the chain will also be a major factor in determining how long it will take to complete. If there is no chain it could take as little as six to eight weeks.

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