What is the Meaning of SSTC?
SSTC, meaning “sold subject to contract,” can sometimes pop up on property listings while you’re househunting. But what does SSTC mean in reality? And can you make an offer on an SSTC house?
Whether it’s your first time entering the housing market, or you’ve already been around this block before, here we help you decode the SSTC meaning and explain everything else you need to know about these four little letters.
What does SSTC stand for?
As we mentioned above, SSTC is the abbreviation for “sold subject to contract”. This means that the seller has verbally accepted an offer made by a potential buyer on a specific property.
As the name would suggest though, when sold STC or listed SSTC, the sale is not yet legally binding. It is in fact still subject to contract. The sale could be cancelled by either party at this stage and negotiations are still ongoing.
Only once the final exchange of contracts takes place does it become a done deal.
What is the difference between sold STC and sale agreed?
Both “SSTC” and “sale agreed” can be used interchangeably. They’re essentially the same.
Another term you might see is “under offer,” which is only slightly different in that while the offer has been made, it hasn’t been verbally accepted. Negotiations may still be in process at this time, and no contract has been signed.
Whether SSTC, “sale agreed” or “under offer”, the next steps in the process are the same once the offer has been verbally accepted.
Does SSTC mean off the market?
In short, no.
Until the final contract is signed, a property listed as SSTC is not officially off the market.
As the buyer, however, you can encourage the estate agent at this point to remove the listing from their website or update the listing with SSTC. This means that the listing becomes less visible and the SSTC label tends to put other potential buyers off.
Can I make an offer on a house sold STC?
Considering that a property sold STC is not technically off the market, if you see one you fancy listed as such, your next question may be, “can you make an offer on an SSTC house?”
Hypothetically a third party is able to view, express interest or even go so far as to make another, higher offer on any SSTC-listed property. This is known as ”gazumping”.
What is gazumping?
Gazumping is when a third party makes a move on a property that is sold STC or SSTC. The third-party may offer more money than the original offer, or be able to complete the sale quicker. Technically, gazumping is not unlawful, but it is frowned upon as an unfair practice.
If, however, as a buyer, you see an SSTC property that catches your eye, you could make contact with the estate agent to let them know you’re interested. This may mean that should the sale fall through and the home is once again available, the agent may let you be the first to know, putting you at an advantage.
Why is gazumping less common in Scotland?
In Scotland, most properties are sold by solicitor estate agents, and once they accept an offer on behalf of their client, they cannot accept another offer from a third party.
If another higher or better offer comes in and the seller wishes to accept that offer instead, the seller’s solicitor will have to withdraw from all legal work on the sale, and a new solicitor will have to be appointed.
The seller is, of course, within their rights to make this change at any time before contracts are exchanged. But aside from the inconvenience of a change in solicitor, it does mean there may be a delay in the sale which could then negatively affect their own purchase. As a result, gazumping is far less common north of the border.
What could cause a property SSTC sale to fail?
Aside from gazumping (where another buyer makes a second offer that is accepted), there are various reasons why an SSTC deal may fall through.
If the buyer is part of a property chain (where their purchase relies on the sale of their own home to someone selling their property, and so on), a breakdown in the chain could delay or even prevent them from completing the deal.
Inefficient solicitors or conveyancers could jeopardise the sale if they fail to produce paperwork or respond to messages in a timely manner.
House surveys could reveal underlying issues with the property. These could be anything from damp, damaged masonry or subsidence. Depending on the results of this survey, a buyer may be put off if serious defects are uncovered, or they might expect the seller to make the necessary repairs. If the seller refuses, the sale could fall through.
What happens during the period when a home is SSTC?
During this time and before final contracts are issued and signed, there is a lot of admin going on in the background.
As mentioned above, a buyer may wish to direct their solicitors to undertake surveys on the property to check for any underlying structural issues or defects.
You may choose to do a very basic Condition Report starting at around £250. It doesn’t offer advice but uses a traffic light system to rate the condition of the home. Green is for good condition, orange highlights that some attention is needed, and red tells you there is an urgent need for repair. This type of survey is best for modern newly built homes.
At the other end of the spectrum, you may choose a Building Survey – Level 3. This is often recommended for older properties or those in noticeably poor condition. The survey can cost anywhere between £500 – £2,000 pounds.
A level 3 closely analyses the building’s structural integrity and condition in great detail, providing detailed guidance on the repairs that should be undertaken, how long they may take, how much they’re likely to cost and what may happen if these concerns are not addressed.
Should there be any concerns raised, the buyer may then decide to renegotiate the price or walk away from the sale entirely.
The buyer will also have their proof of funds confirmed, and once all surveys are completed and relevant information collected, contracts can be written up and exchanged.
Once signed the sale is complete.
How long does it take from sold STC to completion?
It depends! There are several factors at play during a property sale, including the efficiency of the solicitors and agents, whether the buyer has finance in place, the length of the chain and any surveys that need to be conducted.
A rough estimate could see exchange take place in 8 weeks if there is no chain, or at least 12 weeks if there is a shortish chain of around 2-3 houses.
According to Property Academy’s Homeowners Survey 2019, just over half (55%) of home sellers completed their property purchase within 3 months of it being listed as SSTC.
Similar research by ViewMyChain also suggests the process from SSTC to completion takes 120 days. Getting a mortgage usually takes five to six weeks, and the rest of the exchange and completion process takes around three.
In summary
To recap, SSTC means “sold subject to contract.”
As a buyer, once a seller has accepted your offer and the property has been marked as SSTC, the best thing to do is to act quickly to show you are serious. Ask for the property to be removed from the listings or updated as SSTC, chase up solicitors and any surveys that need to be done, and ensure you keep on top of your mortgage application.
Seeing “SSTC” next to the property you’re buying could be your first step towards securing your new home — so here’s to a swift and successful completion day!
And remember, as soon as you get a hold of those keys, you’ll need to have home insurance in place. Our new clients save an average of £167. Get your home insurance quote here.
Also read:
Exchange of contracts explained
Conveyancing: Everything you need to know
First-time home buyers’ checklist
