A Homebuyer’s Guide to “Offers in Excess of”fjpinvestment
Real estate agents often use particular terminology in describing properties they are looking to sell as well as other important aspects of the process. The asking price is one of the most commonly used expressions by real estate brokers. When someone uses offers in excess of, they’re referring to the price the seller or agency is asking for their property. In most cases, this decision is made by the property’s owner. The asking price may not be all you need in some cases. “offers in excess of” (OIEO) and other words may be used. For many, it might be a confusing phrase.
It is frequently shown on real estate listings on the internet, or in the storefront windows of brick-and-mortar establishments.
Jamie Johnson, CEO of FJP Investment, put it like this: “In basic terms, the term “offer in excess of” – also known as the guide price – indicates to interested parties that the price is the starting point at which to make an offer. Bids below this threshold are unlikely to be approved, but those beyond it may continue to rise. This helps ensure that the seller makes a lucrative profit on their property.”
Why are some properties advertised with offers in excess of?
If this is the case, there are a number of possible explanations. In some cases, the real estate agent believes that presenting “offers in excess” will lead to a more successful sale. In other words, even if the property is listed for less than what the seller wants, a larger number of potential buyers could make offers closer to the seller’s preferred price.
Furthermore, it is possible that the property is located in a neighbourhood where property values are drastically different from one another, making comparing prices with other similar properties not so easy. On the other hand, the renovations have changed it so much that the real estate agent can’t give an accurate estimate of the property’s value right now.
In other circumstances, both the estate agency and the home’s owner may have opted to sell the house at auction to try and fetch the best price possible, starting with marketing the property below what it is worth. The objective here is to kick off a bidding war, resulting in a greater price for the property after bidding has ended. However, for the buyer, it may be an opportunity to get a good deal on property if bidding doesn’t take off as hoped.
Is it possible to make an offer below the offers in excess of amount?
You may be able to, but it’s more likely to be rejected. However, there’s no harm in making a lower offer if the home has been on the market for a while and is having trouble selling. The OIEO price may possibly be overpriced compared to nearby houses. As a result, the seller may accept a lower bid because it may be their only choice if they want to sell their property.
If you do decide to bid less than the OIEO value and want to be taken seriously, you must make a strong case for why your bid is the best choice. They could be swayed by your assurance that you have the funds to make the transfer immediately. In many cases, a seller will try to get more money for their property than the market valuation. Because of this, there is no issue with lowering the OIEO offer amount as it’s possible that it’s still higher than the original value.
The difference between the asking price and the OIEO price
Despite the fact that you may not have seen it yet, there is a difference between the two. When someone is trying to sell a home, they put an asking price on the property, which is what they want to get for the property, whereas an offer in excess of refers to what the owner thinks the property is worth.
What is the appropriate offer for an offer in excess of property?
It’s always best to offer the amount you believe the property is worth. Each and every offer will be submitted to the seller for consideration, which means that you and everyone else have an equal chance of success. Whatever offer you make for the property, whether below or above the OIEO, or even the precise amount, the owner will have to make a decision based on their available options.
Is it worth selling my home with offers in excess of?
It depends on who you ask. If you’re concerned about overpricing your home, you may want to reconsider, as this may result in a lack of enthusiasm and interest for buying your home. On the other hand, others think it’s a terrific strategy to get your property on the market for a cheaper price. As a result, the price might rise above what you had planned due to the amount of interest being stimulated.
Sometimes it may also result in a more rapid sale because interested parties may end up making generous offers that are too good to ignore in order to outcompete the competition.
Does an offer in excess of mean anything else?
If you’re thinking about buying or selling a house, you’ve probably come across other phrases. It’s important to make sure your property has the correct one associated with it so as to avoid any confusion. To avoid any confusion, they are not the same as OIEO, even though they are often compared to each other as such.
- Price on application
- Offers invited
- Price on application (POA)
A POA may be connected to a residence because it is considered a high value. It’s often reserved for a high-end residence or a house that defies the norm in the neighbourhood. You will need to get in touch with the relevant estate agent to find out the pricing of these properties. This is intended to make sure that only the most interested parties will make contact and cut back on time wasting.
- Offers invited
Allowing interested parties to set their own pricing is known as inviting offers. If you have a hard time valuing the property for whatever reason, this can offer a practical solution whereby interested buyers can submit their offer. The estate agent can get an idea of what individuals are willing to spend if the majority of the bids are in the same ballpark. After that, the agent will work with the seller to get things moving based on the offers received.