Should we ask for offers in excess of, a guide or asking price for our home?

We are planning on putting our home on the market soon. We have noticed that although most properties have an exact asking price, there are some that don’t.

For example we have seen some ask for ‘offers in excess of’ a specific price, whilst others give a ‘guide price’ or range. There are also some with just say ‘POA’ and no price at all, which seems rather unhelpful.

I want to know what the point of the above listings are and whether there are any advantages of using pricing like this over the standard asking price?

We’ve already had two agents visit to value our home. The first estate agent valued the property at £280,000. The second agent said that was too low and valued it at £300,000. 

Obviously we feel more inclined to go with the higher valuation. Would we be better off asking for ‘offers in excess of £280,000’ or just going with the simple £300,000 asking price?

Ed Magnus of This is Money replies: Everyone wants to get the best possible price when they come to sell their home, although they also tend to want to get some money off one they are buying.

You are right to have noticed the different sales jargon used by estate agents when selling properties.

Although most property adverts will simply have an asking price, have a scroll through Rightmove or Zoopla and you’ll find listings, which include phrases such as ‘offers in excess of’ (OIEO), ‘offers in the region of’, ‘guide price’ and ‘POA’. 

At a time when the property market is running hot – Rightmove says more than a fifth of homes are selling in a week – this kind of pricing trickery comes into play even more. 

So, what does this all mean?  

Offers in excess of suggests to buyers that they need to offer above the asking price, in the hope that it will discourage buyers from bidding below.

A guide price will typically offer buyers a range to offer between or a number to target (presumably  the sellers are hoping they are indicating to offer above this). For example the guide price could be between £275,000 and £300,000. The hope here is that by widening the net, you might attract a wider pool of sellers. 

Quite why people decide to put a guide price that has no range instead of a simple asking price is probably a question best put to the agents advising them. 

POA, which means price on application, requires prospective buyers to contact the estate agent to find out the price.

It is typically when the property itself is unique or bespoke and it is hoped that the secrecy surrounding the asking price might attract greater interest..

‘The asking price should be like good quality lingerie,’ says Henry Pryor, ‘it should attract your attention but not reveal too much.’

It can also be because the seller does not want it to be publicly know how much their property may be worth. However, as most people search through property portals such as Rightmove these days and POA properties tend to be listed with those adjacently priced, it doesn’t take Sherlock Holmes to work out a rough price.

Before being able to decide whether any of these sales tactics might work, you first need to decide which agent to go with. 

This is likely to be a far more important decision that how you mess about with semantics in pricing.

When inviting estate agents to value your property it’s worth remembering that they are also often very keen to win the instruction.

This is even more the case in today’s market, where there are typically only 23 available homes per estate agent branch for every 590 registered house hunters.

Beyond selling their service, some agents will try and tip the balance in their favour by suggesting your property is worth more than other agents are quoting.  

It’s worth bearing that in mind as the last thing you want is a property that is overpriced and attracting no interest from prospective buyers.

To help in answering our reader’s questions we spoke to Ewen Bunting, property expert at independent estate agents James Pendleton and Henry Pryor, a professional buying agent.

Rightmove’s monthly asking price report shows averages for different types of home

Should you consider asking for offers in excess of?

Henry Pryor replies: Offers in excess of just looks stupid. Who doesn’t want as much as possible for their home. It tells me that the seller wants more than the agent thinks is sensible to quote.  

The asking price should be like good quality lingerie, it should attract your attention but not reveal too much.

Ewen Bunting replies: The call for offers in excess of is equivalent to an auction’s guide price.

It is rolling the dice and relying on competition to drive the price higher but it could have the effect of lowering the ultimate sale price.

Should you consider a guide price?

Henry Pryor replies: Back when I started in the business we used to say ‘Price – freehold £x’.

Today agents quote a flexible guide saying ‘offers around’ or ‘offers in the region of’ to ensure that they attract interested buyers.

My advice is keep it realistic, don’t be too ambitious, listen to your agent and if in doubt ask them why they are suggesting that particular figure.

They should be able to show you comparable properties that have sold and that are currently for sale so you can understand.

Should you consider POA?

Ewen Bunting replies: When it comes to listings I am not a fan of using vague prices and POA is a particular bugbear.

It is a very old-fashioned way of an agent saying ‘this home is very special’, but even for a prime property it is extremely unhelpful to sellers, as it guarantees that for every 20 enquiries you receive, 19 will be from buyers who cannot afford it.

You wouldn’t go into a garage and be expected to make a speculative offer on a Tesla, so you shouldn’t have to do so for a house.

Also the POA intrigue factor has been undermined by buyers’ access to portals like Rightmove, which can show the pricing range the property falls within, if not the specific figure.

Henry Pryor replies: ‘Offers invited’ or POA is someone trying to be clever. They want your details so make you call up to ask what the price is.

You can usually find out by adjusting the high and low price on the website to find out what they really want.

By putting a home on the market at the lower end of the scale the first agent is looking to encourage more interest and — importantly — more competition for your property.

How to choose an estate agent 

Ewen Bunting replies: For your property, both agents you’ve consulted have probably the same sale figure in mind but are trying out different routes to reach their destination.

By putting a home on the market at the lower end of the scale the first agent is looking to encourage more interest and — importantly — more competition for your property.

When there are other potential buyers in the fray, house hunters’ focus can shift from how much they think the property is worth to how much they need to pay to ‘win’, which can lead to rival bids pushing the price higher.

While this approach could be right for you, listing in this way is a gamble to try and reach the desired figure quickly – there is a risk that in cooler markets, when stock is more plentiful, such bidding wars just won’t take place.

You may feel the second agent is more on your wavelength with their higher valuation, but this asking price could attract fewer buyers and there is a good chance that they will be negotiating downwards. 

Ultimately I would go with whoever you trust more.

Final tips to get your home sold

Henry Pryor replies: Estate agents don’t come round and ‘value’ your property, they provide ‘advice prior to a possible sale’.

You’d know if they were valuing it because you would pay for it and if it was wrong you could sue them.

Estate agents are giving an indication of the best price to quote to attract the largest number of potential buyers to come and see the property, to fall in love with it and to then compete for it.

They are NOT suggesting what they think it will sell for but they do allow homeowners to think that this is the case. Many even have instant valuation widgets on their websites.

We are all susceptible to flattery and agents will often inflate the ‘valuation’ in order to get the business. 

If I tell you that I think I can get more for your property than someone else then you are more likely to give me the instruction.

For buyers the asking price is a combination of the greed of the owner and the enthusiasm of the agent to get the business. 

Remember, even in today’s red hot housing market only a minority of homes sell for more than the asking price.