Buying a house is a difficult and stressful process, and estate agents have taken the saying ‘if you have to ask, you can’t afford it’ to the next level with use of acronyms such as POA, OIEO and guide price.
So, what does POA mean in property? How will it affect you when putting in an offer on a house?
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What does POA mean in property?
It’s a term that often appears on property listings, standing for Price on Application or Price on Asking. Instead of displaying a fixed price, POA requires prospective buyers to contact the estate agent for details. This approach, once popular for high-value or unique properties, has sparked debate over its effectiveness and transparency. Recent rulings by the National Trading Standards Estate and Letting Agency Team (NTSELAT) have deemed the use of POA unlawful for property listings in England, citing consumer protection concerns.
Statistics highlight the shift away from POA. According to NTSELAT, withholding price information can mislead buyers and hinder informed decision-making. In fact, 78% of buyers report frustration when encountering POA listings, as it complicates their ability to compare properties and assess affordability. This regulatory change aims to improve transparency in property transactions, ensuring that buyers have access to essential information upfront.
POA was traditionally used for bespoke or luxury properties where a fixed price might not reflect market demand. Sellers valued its ability to maintain privacy, particularly for celebrities or high-profile individuals who wished to avoid public scrutiny of their financial affairs. Estate agents also leveraged POA to gauge buyer interest before committing to an asking price or to create exclusivity around a listing.
However, the drawbacks of POA are significant. Buyers often perceive properties listed as POA to be overpriced, leading to reduced interest. The lack of transparency can deter genuine inquiries and create mistrust between agents and potential buyers. Additionally, online property portals require a hidden numeric price for sorting purposes, meaning savvy users can estimate the approximate value—rendering the secrecy ineffective.
The table below summarises the pros and cons of using POA in property listings:
| Pros | Cons |
|---|---|
| Maintains seller privacy | Can frustrate potential buyers |
| Useful for unique or luxury homes | Often perceived as overpriced |
| Allows flexibility in pricing | Contravenes consumer protection laws |
| Creates exclusivity | Reduces transparency in transactions |
For rental properties, POA has been used similarly—to gauge demand and encourage competition among tenants. Landlords might use this approach for new developments or highly sought-after locations. However, even in rentals, transparency is increasingly prioritised over exclusivity.
Why do estate agents put POA on properties?
Estate agents would argue that using POA gives the property a feel of exclusivity, and it is used for more expensive properties, as you can only find out their asking price by showing interest. The seller could be a celebrity who values privacy, or the owner wishes to keep the price private from family or neighbours.
POA can be used to allow the market to dictate what the property is worth if:
- an estate agent can’t decide on a price
- can’t agree a price with the vendor
The property can be put up for sale without a commitment to an agreed price, therefore allowing enquiries from prospective buyers to help determine the price.
Some estate agents believe the mystery of POA will create the buzz, and the interested buyers will want to get in touch to learn more about the property.
An estate agent can use POA to their advantage because any prospective buyers will have to get in touch with them to ask for the price. They will then have their details on a database to market other properties that come up for sale.
What does guide price mean?
Unlike POA, a guide price provides an approximate value rather than withholding pricing information entirely. It offers buyers a range within which they can expect the final sale price to fall. Guide prices are commonly used in auctions or competitive markets where bidding determines the final amount.
POA is quite an old-fashioned method and is deemed an unlawful practice by the Trading Standards.
What does POA mean when buying a house?
For buyers, encountering POA means they must contact the estate agent to learn the asking price. While this may seem straightforward, it often leads to frustration due to the lack of immediate clarity. Buyers may feel that properties listed as POA are intentionally vague or overpriced.
What’s the difference between the guide price and asking price?
Guide prices tend to be lower to encourage interest and offers from potential buyers. The asking price is the price that a seller is willing to sell for and may be willing to negotiate on it.
The asking price tends to be slightly higher than market value in the hope that a motivated buyer will pay for it, or it leaves movement for negotiations.
Most estate agents overvalue their properties by 5-15% to win the instructions.
For instance, if a seller wanted £200,000 for their property if their asking price is £220,000, the buyers are likely to haggle and end up paying £200,000 or more. Buyers tend to pay slightly below the asking price to feel they are getting a good deal.
In summary, a guide price is slightly below the true value of a property to encourage offers and create a bidding frenzy, whereas an asking price tends to be higher than the market value – leaving room for negotiation.
What does OIEO mean?
OIEO is abbreviated with offers in excess of.
OIRO is another acronym that stands for offers in the region of. OIEO is used when the seller wants more money for their property than what an estate agent believes it is worth.
Offers in excess of can often put off any potential buyers because they feel their offer will be rejected. Provided that your offer isn’t too low and isn’t considered to be a ‘cheeky offer’, then you can still put it forward because the seller may not have received any other offers.
If you are looking to put in an offer on a property with OIEO, but your offer is below their expectation, then it is best to make it clear what you are offering. Your offer could be a cash offer, meaning there are no delays and no chain. All these factors can make it attractive to the seller.
According to the Daily Mail, 85% of properties sell for less than the asking price.
Houses that are difficult to value because there are no sold comparables or not many on the market are listed as OIEO (offers in excess of).
What does offers invited mean?
Offers invited are used when the agent isn’t too sure about the true value of the property, so they are inviting views and buyers to make offers.
The seller has probably had enough with the property sitting on the market and, therefore is inviting offers. Don’t forget to remind the estate agent that you are a proceedable buyer with no property to sell, if that’s the case, and if you are a cash buyer make it clear as part of your offer.
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