When looking at property in Scotland you will very quickly notice that most have an asking price starting ‘Offers Over’. What does this actually mean?
Asking prices are simply a marketing tool. It is very important to note when a property is advertised as ‘offers over’ but there is a lot more to consider when deciding what to offer. Continue reading for other factors that play a huge part.
When buying a house, what does offers over in Scotland REALLY mean?
Is ‘offers over’ the most common way to market a property?
When sellers take their home to the market their goal is to achieve the best price possible. This is completely understandable, as we all need to fill the money pot for the next house.
‘Offers over’ is the most common way of marketing a property in Scotland.
How do they decide what the offers over asking price will be
Most commonly a property will be marketed at Offers Over the home report value. So if a property has a home report value of £200,000, the asking price would be Offers Over £200,000.
Equally some selling agents recommend to their clients that they market a little lower than home report. For example if the home report was £200,000, the asking price would be Offers Over £195,000. This is purely to ensure the asking price looks attractive and enticing.
Never do selling agent recommend the asking price is in excess of the home report value. This would have a negative marketing impact and deter buyers. If you do see it, it’s likely driven by the seller and hopefully the selling agent would have highlighted the pitfalls to their client.
You may see the asking price to be higher than the home report value in the sale of some rural countryside properties. An example of this may be when a house has land and the value of the land is not included within the home report. They then account for the value of the land in the asking price.
Does it mean you can only offer over the asking price
No. As a buyer you can offer any level you wish. As a buyer you will of course be looking to achieve as high an offer as possible.
As a buyer you need to give many things consideration before deciding whether to offer over, under or at the asking price.
- How long has the property been on the market.
- How many other interested buyers are there.
- What is the home report value.
- Is there a closing date.
- What for and when did the property last sell
The most important thing to do is discuss the property with your solicitor. They will be able to provide you with their professional advice and asses the level of interest. Your solicitor will also have access to recent sales of similar properties to understand how much they sold for.
When do buyers offer under the asking price?
If a property has been on the market for many months and there is currently no other interest, its highly likely you could secure the property for below asking price.
I would certainly be recommending you dip your toe into the water at a lower level to gauge the sellers expectations.
When do buyers offer over the asking price?
If the property is new to the market, or has only been on the market for a few weeks or a couple of months then the seller has a stronger chance of achieving an offer at, or above, asking price.
If you are competing with other buyers at a closing date then buyers will highly likely offer above asking price.
Do sellers have to accept my offer?
Absolutely not! Remember the seller is in control and will make the decision on any offer submitted.
You do hope the seller has realistic expectations and understand the present market conditions. If the market is slow, you would hope the seller would consider a serious offer, even if it is below asking price. Equally, if the market is strong the seller will likely achieve a good offer over asking price and consider a good serious offer.
Just a marketing tool!
So what does offers over mean in Scotland? Well, as an agent myself we simply decide to market most homes at offers over their home report value. What the property actually sells for is decided by the market conditions and what a buyer is prepared to pay.
An asking price is simply a marketing tool!