conditionally sold real estate term

Have you ever found a home while searching online that you’re interested in buying only to be told by the real estate agent that it’s sold conditional? Most home buyers will at one time or another come across a home that they absolutely love, only to be disappointed when they are told they need to keep looking.

Finding a home you like only to be told it’s sold can be frustrating to new buyers. Is the home for sale or isn’t it? Can you put an offer on it? Is the agent making it up? In this article I will explain what sold conditionally means, and what it means to you as a buyer.

The Definition of Sold Conditional

When a home is ‘Sold Conditionally’ it means that a buyer and seller have come to an agreement on the sale of the property. However, there are conditions that have to be fulfilled as part of the agreement for the deal to be considered binding, or what realtors refer to as a ‘firm deal’.

Common conditions found in residential real estate contracts include conditions on the buyer arranging financing and a condition on a home inspection.

What’s frustrating for home buyers is that there’s no way of knowing this without calling a realtor, because homes that are sold conditionally will still appear as ‘for sale’ online. Real estate agents are able to see that a home is sold conditionally on the MLS system, but this information doesn’t appear on public websites. I hope this gets changed in the future but for now this is the way it works in Mississauga, the real estate market I work in.

2 Listings of the same property. On the left is what the public sees, and the site says the home is for sale. On the right is the listing on the Toronto MLS, (available only to realtors) where you can see it is sold conditionally and it even tells you what the conditions are.

Can you put an offer on a house that is conditionally sold?

The short answer is Yes. You can make an offer on a house or condo that is conditionally sold, but you need to keep in mind that the seller has already accepted an offer from another buyer so they would have to be released from that deal in order to avoid a legal nightmare of selling their home to more than one buyer. So most of the time it isn’t worth it, but there are a few exceptions to this rule.

When it is a good idea to make an offer on a Conditionally Sold Property

  1. The selling agent has a good idea the deal is going to fall apart. Sometimes things just don’t work out, and at that point the listing agent may notify you to put in your offer. In this case you’ll have to make it conditional on the seller being released from their previous agreement but it does happen. The easiest way to do this is to have your agent call the selling agent and find out what’s going on with the conditions.
  2. If the offer is conditional on the sale of a home. In slower markets, sellers may agree to a condition on the buyer selling their home. In this case, normally there will be an escape clause where if the seller receives another offer, they give the buyer notice and the buyer will then have a certain time period to either waive the condition or firm the deal up. If you are the second buyer you will negotiate the deal, and then have to wait to see if the other buyer backs out.
  3. While this is very rare, you could make an offer conditional on the seller being released from their previous agreement, and then make a deal with the other buyer to release them. Chances are this will cost you so I don’t normally recommend this unless you HAVE to have this particular home and you’re willing to pay a premium. The buyer doesn’t have to agree, but you can always try.

I like to say that anything is for sale in real estate, if the price is right!

How Often Do Conditions Fall Through?

The reality is that in a decent market, deals don’t fall apart that often. In my experience it’s probably around 5%. Not great odds, so it’s usually better to move on and find another home.

Should you spend your time looking at Conditionally Sold Real Estate?

In most circumstances I would say no. There’s always another home out there, and it’s better to look at homes that you can buy, instead of falling in love with a house you most likely can’t.

The final word on Conditionally Sold Real Estate

As long as you understand that the chances are low that you’ll be able to purchase a home that is sold conditional, there’s no harm in looking. Just realize that your realtor probably won’t be thrilled with the idea, so try not to do it too often if you want to keep a good working relationship!

I hope you enjoyed this article on the definition of Sold Conditional in real estate. If you have any more questions don’t hesitate to contact me. Also, be sure to check out our Home Buyer Frequently Asked Questions!

  • The Village Guru
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1 reply
  1. Dona Sells
    Dona Sells says:

    Wow it’s good to know about this! Now I know how to deal with SC real estate that I am interested in! Thanks for sharing!

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