Buying or selling a home often comes with unfamiliar terms, and “under contract” is one that frequently pops up on Zillow. For those new to real estate, it might seem confusing or even misleading at first glance. Understanding what this status means is crucial for both buyers and sellers navigating the housing market.
When a property is marked as “under contract” on Zillow, it indicates an important step in the home-buying process. It doesn’t mean the sale is final but rather that the seller has accepted an offer from a buyer. However, there are still steps to complete before the deal is officially closed. This status can influence a buyer’s next move or a seller’s expectations, making it essential to grasp its implications.
Understanding “Under Contract” On Zillow
The status “under contract” on Zillow means the seller has accepted a buyer’s offer. However, this doesn’t mean the transaction is complete. The home remains in the sales process until certain conditions are met.
During this phase, various steps, such as home inspection and loan approval, occur. These steps are essential for the sale to progress toward closing. If the buyer or seller can’t fulfill agreed conditions, the deal may fall through, and the property could return to the market.
Buyers viewing homes marked “under contract” on Zillow may still show interest. Backup offers are sometimes considered in case the primary agreement fails. Sellers often use this status to signify that active showings can pause or shift focus to completing due diligence.
What Does “Under Contract” Mean In Real Estate?
“Under contract” in real estate indicates a property has an accepted offer, but the sale process is incomplete. Buyers and sellers must finalize conditions before closing.
Definition Of “Under Contract”
“Under contract” means the seller accepted a buyer’s offer, creating a legal agreement. The property remains off the market unless the deal fails during inspections, appraisals, or financing. Buyers can still submit backup offers while the primary agreement progresses.
How Zillow Displays “Under Contract” Properties
Zillow marks properties with “under contract” to show their pending sale status. Users see this label prominently on listings that are temporarily unavailable for offers. While marked, these properties often remain visible to inform buyers about market activity. Example: a detailed listing page typically states “under contract” near price and description details.
Buying A Home That Is “Under Contract”
A property marked “under contract” means an agreement exists between the buyer and seller, but the sale isn’t final. This status often attracts attention from buyers who may wonder if they can still make an offer.
Can You Still Make An Offer?
Buyers can submit a backup offer for a property listed as “under contract.” A backup offer comes into play only if the original deal falls apart due to contingencies like inspections or financing issues. Sellers are not obligated to accept additional offers but may consider them to safeguard their sale.
Backup offers won’t disrupt the current agreement. They’re simply kept as secondary options, ensuring the seller can quickly proceed with an alternate buyer if needed.
What Happens If The Deal Falls Through?
If the current deal fails, the property typically returns to active status, allowing new offers to be made. Situations causing this include unmet contingency conditions, failed financing, or unresolved inspection findings.
At this stage, previously submitted backup offers may gain priority, or the seller may reopen the listing to broader interest. This makes it essential for buyers to act promptly if the house re-enters the market.
Common Misconceptions About “Under Contract” Properties
Many people misunderstand what “under contract” means on platforms like Zillow. These misconceptions can lead to confusion for both buyers and sellers.
Confusion Between “Under Contract” And “Pending”
Some think “under contract” and “pending” are the same. “Under contract” signals a signed offer with ongoing conditions like inspections or financing. “Pending” indicates most contingencies are met, and the sale is closer to completion. Zillow uses both terms to highlight different transaction stages.
Impact On Home Buyers And Sellers
Buyers sometimes assume homes listed as “under contract” are unavailable. While not active, backup offers can still be submitted. These secondary offers become relevant if the primary deal falls through due to unmet contingencies or financing issues.
Sellers might think “under contract” guarantees a sale. In reality, the sale depends on buyers clearing conditions like appraisals and loan approvals. If conditions aren’t satisfied, the house could return to the market.
Tips For Navigating “Under Contract” Listings On Zillow
Understanding how to handle “under contract” listings helps buyers and sellers make informed decisions. These tips explain how to approach such listings.
Strategies For Buyers
- Contact the Listing Agent
Buyers should reach out to the listing agent to understand the property’s current status. They can ask if the seller is open to backup offers and gather information about the contingencies tied to the contract.
- Submit a Backup Offer
Interested buyers may submit a backup offer, ensuring they’re next in line if the original deal fails. Backup offers need to be competitive, as they may face competition from other interested buyers.
- Monitor Contract Progress
Buyers can keep track of listings they are interested in and check if any fall out of contract. Zillow alerts or regular updates from the agent can help buyers act fast if homes return to an active status.
- Evaluate Alternatives
Instead of solely focusing on “under contract” properties, buyers can explore similar active listings nearby. This approach avoids wasting time on limited options.
Advice For Sellers
- Communicate With Interested Buyers
Sellers can maintain transparency with backup offer submissions. Informing potential buyers of the “under contract” status and accepting offers if contingency issues arise benefits both parties.
- Complete Contingent Steps Promptly
Sellers should ensure inspections and appraisals are scheduled and completed quickly. Delays may discourage buyers from staying committed during the contract phase.
- Make Contingencies Clear
Clearly stating all conditions, such as financing or home repairs, reduces the likelihood of misunderstandings or failed transactions.
- Prepare For Market Reentry
If a deal falls through, sellers should have a strategy to relist quickly. Updating the listing and contacting previously interested buyers helps reduce downtime.
Conclusion
Understanding the “under contract” status on Zillow is essential for navigating the real estate market effectively. It reflects a critical phase in the buying and selling process, where both parties work to meet agreed conditions before finalizing the sale.
For buyers, this status presents an opportunity to explore backup offers, while sellers can focus on fulfilling contingencies to secure the deal. Staying informed and proactive during this stage can make a significant difference in achieving a successful outcome.
Frequently Asked Questions
What does “under contract” mean on Zillow?
“Under contract” means the seller has accepted a buyer’s offer, but the sale isn’t final. Contingencies like inspections, appraisals, or loan approvals still need to be completed. During this time, the property is temporarily off the market but may return if the deal falls through.
Can buyers make offers on properties under contract?
Yes, buyers can submit backup offers on properties under contract. These offers are considered only if the current deal fails due to issues like financing or unmet contingencies.
What is the difference between “under contract” and “pending”?
“Under contract” indicates a signed offer with ongoing conditions, while “pending” means most contingencies have been met and the sale is nearing completion. Homes marked as “pending” are generally closer to finalizing the sale.
Can a seller accept another offer while under contract?
No, once a property is under contract, the seller cannot accept new primary offers but may consider backup offers if the original deal doesn’t close.
Does “under contract” guarantee the home will sell?
No, “under contract” does not guarantee a sale. The deal can fall through if conditions like inspections, appraisals, or financing aren’t met.
Why does Zillow show “under contract” homes?
Zillow displays “under contract” homes to inform users of market activity. Although unavailable for primary offers, these listings provide insight into the real estate market.
What should a buyer do if interested in an “under contract” home?
Buyers should contact the listing agent, inquire about the property’s status, and consider submitting a competitive backup offer in case the current deal fails.
How long does a property stay under contract?
The timeframe varies but typically lasts 30–60 days, depending on how quickly inspections, appraisals, and loan approvals are completed.
Can a home go back on the market after being under contract?
Yes, if the deal falls through due to unmet contingencies or financing, the property may return to active status, allowing new offers to be made.
What should sellers do when their property is under contract?
Sellers should focus on completing the necessary steps, like inspections and appraisals, while maintaining communication with their agent to address any issues promptly.
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