My buyer wants a reservation agreement. Should I sign?

What is a reservation agreement?

A reservation agreement is a contract signed after an offer has been accepted, in which both sides commit to completing the sale within an agreed period. Each side puts down a sum of money that is forfeited if they pull out for a reason that is not on the agreed list.

It sits in the gap that has always existed in England and Wales between an accepted offer and exchange of contracts. Until exchange, either side can walk away at no cost, which is the gap gazumping and gazundering live in.

Why is my buyer asking for one now?

Because the ground is moving under the whole process. The government's home buying and selling reform roadmap, published on 19 June 2026, sets out a plan to make binding conditional contracts a requirement once upfront sales packs are established, later in this Parliament.

In the meantime, the roadmap says the government will spread awareness of the voluntary use of reservation agreements, particularly where full upfront information about the property is already available. Solicitors and agents have started offering them on that basis, so more sellers are being asked in 2026 than ever were before.

What problem is it actually trying to solve?

The numbers behind the reform are the reason a buyer may want one, and they are the reason you might too.

What does signing one commit me to?

More than most sellers assume when they first read it. The agreement is mutual, so the protection runs in both directions and so does the penalty.

• You agree to sell to that buyer, at that price, for the length of the reservation period.
• You almost certainly agree to take the home off the market and stop accepting offers for that period.
• You put your own money at risk. If you pull out for a reason that is not on the permitted list, you lose it.
• You do not get a guaranteed completion. A reservation agreement makes walking away expensive; it does not make it impossible.

What reasons let me withdraw without losing the money?

The government's model allows exits for death or serious illness, a major change in financial circumstances, and newly discovered information about the property. Individual agreements vary, and this is the clause that decides whether the contract is fair to you.

Read your side and your buyer's side next to each other. If their list of escape routes is longer than yours, the agreement is not mutual, whatever it is called.

Are all reservation agreements the same thing?

No, and this is the part worth slowing down on. Two very different arrangements are both sold under the same name.

• The mutual kind, which is what the reform roadmap promotes. Both sides put money down, it is held by their conveyancers, and if the other side walks away the money comes to you as compensation for your wasted costs.
• The agent-fee kind, most often attached to a modern method of auction sale. The buyer pays a large non-refundable fee, and that fee goes to the agent rather than to you. It buys the buyer exclusivity and it buys the agent certainty. It does not put a penny in your pocket if the buyer disappears.

Both are legal and both have their place. Only one of them is protection for you, so ask the plain question before anything is signed: if my buyer walks away next month, who ends up with this money?

What should I check before I sign?

1. 1. Send it to your own solicitor first

   A reservation agreement is a legal contract, and half an hour of your solicitor's time costs far less than the sum you are being asked to put at risk.

2. 2. Check who holds the money

   Your deposit and your buyer's should sit with a conveyancer or in a stakeholder account, never in an agent's general account and never with the other side.

3. 3. Read both lists of permitted reasons to withdraw

   Compare your escape routes against your buyer's line by line, and ask for yours to be widened if they are not the same.

4. 4. Check how long you are locked in

   The reservation period should match the realistic time to exchange on a sale like yours, because an agreement that expires before exchange has protected nobody.

5. 5. Ask what the money is for

   Find out whether a forfeited sum is compensation for your wasted legal and survey costs or a flat penalty, because the two behave differently if your costs run higher.

6. 6. Pin down what it does to your marketing

   Most agreements require the home to come off the market, so establish whether that means no further offers, no viewings at all, or the board coming down.

7. 7. Sign only once their money is down

   Ask your solicitor to confirm the buyer's deposit is actually held before your copy is returned, rather than taking a promise that it is on its way.

Can I say no?

Yes. There is no legal requirement in England and Wales to sign one, and refusing does not end your sale. Say no plainly, and say what you will do instead.

A reasonable buyer who genuinely wants certainty will usually accept a shorter exclusivity period, or a mutual agreement drafted by your solicitor rather than theirs, or simply a firm timetable to exchange.

How do I judge whether my buyer is really committed?

Whether or not you sign anything, read commitment by what a buyer has spent and instructed, not by what they say. Enthusiasm is free. These are not.

• A solicitor instructed and paid, not just named.
• A full mortgage application submitted, which is a different thing from an agreement in principle.
• Searches ordered and paid for, which is usually the first few hundred pounds a buyer genuinely cannot get back.
• A survey booked with a date in the diary.
• For a buyer with a home to sell, their own sale agreed and progressing rather than merely on the market.

Move in step with your buyer rather than ahead of them. Lining up your own solicitor early is cheap and keeps momentum, but the larger spends and the decision to come fully off the market are worth holding until the buyer has put their own money down. A reservation agreement, done properly, is simply a formal way of making both sides do that at the same moment.

Commitment you can see on a bank statement is worth more than commitment you can hear on the phone.

Common questions about reservation agreements

ValuQ gives UK homeowners free, side-by-side property valuations from competing local estate agents, so the price you eventually commit to is one you chose after seeing the full picture, not the first number you were given.