Buying a house or property is not easy. For example, you must understand some complex terms used by real estate agents. They use specific terms to refer to the property they are trying to sell and other important aspects of the process. One of the most common terms used by real estate agents is asking price. This term refers to the amount of property the seller or agent wants. The owner of the property usually decides it. Sometimes, the asking price is not all you need. You may find yourself facing other terms, such as "offers in excess of".
"Offers in excess of" is a marketing technique that attempts to force buyers to offer more than a certain amount of offers, regardless of whether the building is worth the extra cash. Offers in excess of, its abbreviation OIEO, aims to refer to the starting point of providing a quote. For example, if the guide price is £275,000, your offer cannot be lower than this amount, but you can exceed this amount as needed. However, most potential buyers are often confused about this term and how they need to interpret it. This is mainly because acronyms or terms are usually included in the price.
The most common usage of the term refers to agent or supplier compromise. Suppliers may have to review all comparable evidence and agree to marketing strategies to help achieve the ideal price with Offer In Excess Of. Marketing strategies are usually based on the idea that the lowest price (that is, the overquote) will attract more potential buyers.
Another common use of the term is to encourage interest in real estate. OIEO is a competitive price, usually lower than the house report valuation. It is determined based on the understanding that the final price paid for the property will be higher. Therefore, it serves as a starting point or sign for bidders or potential buyers to provide quotations.
In addition, the guide price can be used in situations where it is difficult to value the property. This happens when the property or its location is very unique. In most cases, agents or suppliers have no precedent for the selling prices of comparable properties in the same location. This is usually the case for architect-designed residences, grand design conversions and castles. In this case, the agent will list the supplier's bottom line price. This is the lowest price for a particular property that the seller is willing to accept. Potential buyers will have to reach this price or higher.
Suppliers can also use OEIO if they believe the value of their property exceeds the valuation. It may also be more valuable than the money they spent buying or building it. Using this phrase may encourage buyers who limit their search to a certain amount and convince them that the property is worth that particular price.
One of the most common questions in real estate is whether you can go below the OIEO price. Practitioners also want to know what happens if they fall below the quoted price. Many potential buyers worry that if their offer is lower than this amount, their offer will be ignored or not accepted. However, it is wiser to send any price you think the property is valuable to you. You can use your agent to add some charm and justify the price as much as possible.
You must also emphasize the advantages of your bid and make sure that you have made all arrangements so that you can complete the purchase as soon as possible after your bid is accepted. Reasons may attract suppliers to accept your price, even if it is lower than the guide price or asking price. Most of the time, the seller wants to sell the property at a price higher than the original price. Therefore, even if you are slightly below the asking price, you may still be above the original price of the property. The bottom line is that there is no harm in being below the guide price. Research shows that 85% of homes sell for less than the asking price.
The main reason potential buyers are confused by this term is that it is not as common as asking or guiding prices. Most of the time, potential buyers will be postponed by this deadline. This is because it is often confusing and may appear arrogant in terms of suppliers or agents. Potential buyers and other agents know that sellers will use this term if they feel that their house is worth more than it actually is, so they are arrogant.
However, this must always be the case. Potential buyers can interpret this phrase as the market value of the property. Therefore, using this term when selling real estate may be a gamble. It can encourage faster selling of your property by attracting a large number of potential buyers. However, it can also go the other way and delay potential customers.