"Offers in Excess of" in England

BettiePage

I'd still offer less than their oieo price

wanttomove

The house we have just has an offer accepted on was OIEO £225k but we started at £215k and got it for £218k even tho they said they wouldn't drop below 220k

Fergie73

I'm in Scotland and there was one up for sale at offers over £149k. It's been on the market for a couple of months. They've now got it at a fixed price of £165k!

The Scottish system is crazy, and very depressing for buyers in a rising market. It's been common in Edinburgh and Aberdeen for property to go 50% above asking price or even more, although the "expectation" is 20-30% over. Also, the bids are sealed, so you have no idea what the next person up or down is offering, so you can either completely over-pay or put in a hopeless bid.

In the boom years there were pretty much no fixed price properties on the market at all. It's interesting to see them come back, because you see what the vendor is really looking for "offers over £90K" seems to mean they're expecting about £120-125K, which seems a high margin to me.

It would be very interesting to see what happens in a falling market, whether people start offering below fixed price, or little more than the offers over one. I reckon it gets to a stage where the offers over system is bad for vendors too, because buyers simply give up and stop putting in offers after a while if they know an investor will come in vastly over them. So when investors pull out, no one offers.

IveSeenTheLight

Fergie73 wrote: »

The Scottish system is crazy, and very depressing for buyers in a rising market.

I love the Scottish system and would absolutely hate having to deal in the English system.
I certainly dont think it is depressing for buyers, although I guess maybe for those who have not done enough market research

Fergie73 wrote: »

It's been common in Edinburgh and Aberdeen for property to go 50% above asking price or even more, although the "expectation" is 20-30% over.

Agreed the properties have been going well over the asking price, this is primarily for two reasons.
1) The property is generally marketted below the valuation to attract interest
2) As the market has been rapidly rising, people have been willing to pay above valuation in order to secure the property maybe one or two years ahead of the valuation based on the rising market.

Option 2 will probably be a much lesser viable option if the markets stagnate or dip

Fergie73 wrote: »

Also, the bids are sealed, so you have no idea what the next person up or down is offering, so you can either completely over-pay or put in a hopeless bid.

Regarding the sealed bid. I cant think of a fairer system.
You bid what you believe to be a fair price to secure the property always bearing in mind affordability.
If you secure the property then you have succesfully bid for the property according to the market and your affordability, if you do not then you either have not valued the property succesfully or someone has valued it higher due to their circumstances or affordability.
At least you cannot be gazzumped in this situation

I have bid for 5 properties in Scotland and have won 4 out the 5 bids, 3 of them I won within £500 of the second bidder, 1 of which I was the only bidder and secured 3% under the asking price. The one I failed with had a couple of issues with the property and so I put in a bid that I thought it was worth giving the fact of the work required. I came 4th out of 5 bidders and marked it up to experience and that the property was not right for me and my circumstances

Fergie73 wrote: »

In the boom years there were pretty much no fixed price properties on the market at all. It's interesting to see them come back, because you see what the vendor is really looking for "offers over £90K" seems to mean they're expecting about £120-125K, which seems a high margin to me.

Agreed it will be intersting if a falling market occurs, however I would question whether the asking price is in alliance with the surveyed valuation. As stated above many times the asking price is below the valuation to generate interest

Fergie73 wrote: »

It would be very interesting to see what happens in a falling market, whether people start offering below fixed price, or little more than the offers over one.

For me, any property marked as fixed price is open to receiving offers below that price to test the waters. If the seller agrees will predominantly be linked to the market and how many interested viewers there are.

Same with the offers over, if the market is slow, then there will be much less interest and the property will be open to lower offers.

For both situations they really are linked to how much interest is out there for the property

Fergie73 wrote: »

I reckon it gets to a stage where the offers over system is bad for vendors too, because buyers simply give up and stop putting in offers after a while if they know an investor will come in vastly over them. So when investors pull out, no one offers.

It will never happen like that. Buyers will not pull out because the property might go to investors, they bid and see if they will win. If the market is really slow and there are more properties for sale than buyers then maybe you will see a return to no offers being made, not because of the offers over system though.