The Dreaded 'SOBP' Clause

When Purchasing a Home

SOBP offers can make life a little difficult and a little stressful if you are the one making that offer.

So, what is it?

It is a clause that must be inserted into an offer to purchase IF buying this next house requires you to have sold your current home in order to have the funds required to purchase the second home.

It is very difficult to purchase a home if you currently own a home that you must sell first in order to be able to secure the second home. Typically a buyer finds a property he falls in LOVE with and wants to put in an offer. One of the conditions must be “The Sale Of the Buyers Property” (SOBP). This allows him/requires him to back out if he is unable to sell his current home.

BUT… if this scenario can be avoided it is preferred. The negatives to an offer like this are:

• It is a weak offer that many sellers will not even entertain

• If they do accept an offer with an SOBP clause, the Sellers will always place conditions on his offer. The conditions are:

  • They can keep showing the property

  • The property does not show as “pending”

  • They can accept another offer

If they do accept another offer, they will let his agent know and from that point he, typically, has 48 hours to remove that condition or walk away from his original offer.

Meanwhile...

• you are excited about getting the new home you have dreamed of.

• You have, possibly, priced your home a little less than it should be in the hopes it sells quickly.

• You are quite stressed every day in which you don’t have a showing.

• After a week, you are terrified when the phone rings. Fearing it is your Realtor telling you the 48 hour clock has started ticking. 🥴

It is a genuinely poor position to be in and one I never recommend to clients. It rarely works in favour of the person with their own home to sell. If at all possible, once you have decided a new home is in your future, it is always better to list it in advance. Yes, this can get tricky from a timing perspective, however, once you have an accepted, unconditional offer..

• You can REALLY start looking

• You know how much money you have to spend

• You have, ideally provided yourself with as much time as possible until the purchasers of your home are due to move in.

These are the kinds of considerations a professional Realtor can assist you with.

Oh ya... I am one 😊. Don't hesitate to call me.

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