Understanding 'Active Under Contract' Status

When looking for a new home, you will encounter different statuses for a listing: contingent, pending, active, or sold. These terms signify the current stage of the sales process for the home. Recognizing these distinctions can be beneficial in discovering available properties to buy, guiding you on the appropriate actions to consider if you wish to make an offer on any of them.

Now, let's talk about the active status. One might think the term active is a complete sentence unto itself, well it is not. There are many types of an active real estate listing in Texas:

• Active: The subject property is available to buy and for showings to licensed agents and REALTOR®s. The original expiration date the listing agent entered is when the listing will expire on the MLS.
• Active Contingent: A purchase offer has been accepted by the seller and the seller is requesting the home remain active to solicit backup offers for purchase.
• Active Option Contract: The seller has accepted a contract with an option period and the contract is still currently in the buyers option period. The sellers are still accepting showings and backup offers.
• Active Kick Out: The property currently has an offer that depends on the buyer selling another property (see TAR Form 1908). It is still open for viewings and accepting backup offers. The offer's validity will end on the initial expiration date set by the agent.

What the Actual Definition of Active?

The dictionary defines contingent as the following:

• Energetic or Participating: Being engaged in some kind of physical or mental activity. For example, an active person is someone who regularly exercises and engages in physical activities.
• Operational: Something that is currently in use or functioning, as opposed to being dormant or inactive. For instance, an active volcano is one that is currently erupting or showing signs of eruption.
• Present or Ongoing: Something that is currently happening or continuing, rather than being completed or in the past. An active investigation is one that is still ongoing.
• Not Passive: Not merely receiving actions but taking actions or initiatives. An active listener is someone who is engaged in the conversation and responding appropriately.
• Available for Use: Something that is accessible and ready for use. An active account is one that you can use for transactions.
• Involved in Military Service: An active-duty military member is currently serving in the armed forces.

The definition of 'Available for Use' strikes very close to home for us in the real estate world. The status of active does mean the home is available for purchase.

Why Can't I Buy the Home in All States of 'Active'?

The short answer is, because...

The long answer is because many of the 'active' states are actually under contract by buyers and they are waiting to clear a contengency or accomplish some required action. Once the task has been accomplished the property will move on to another status and out of the various 'active' statuses.

What Does 'Active Kickout' Mean?

The active kickout status is one of the more misunderstood statuses we have in Texas.

A kick-out clause lets people selling their house keep looking for better offers even if they've already agreed to an offer that depends on certain conditions. This rule in the contract allows sellers to say yes to an offer that has some conditions, while they keep trying to get a different offer without those conditions.

The 'kickout' also lets the seller who just received an offer without a contengency notify the current buyer that they have a certain amount of time ( usually 72hours) to remove their contengency or the sellers can kick out the current buyers and sell to the new buyers who do not have a contengency.

Kinda cool is you are the sellers and not so much if you are the buyers who get 'kicked out'.