POA in property is a way of disguising the asking price of a house when it's been sold through the open market. It can also function as a placeholder in the case that a price has yet being decided. For a house to be for sale POA, there's usually some form of reason prompting the seller to do so, but more on that later. However that's not to say pricing a property POA prevents buyers from detecting a ballpark figure.
You see, the majority of property portals (RightMove, Zoopla etc.) need an asking price in order to calculate where and to whom they should be marketing a POA property. Let's face it, no one hunting for a two-bed terrace wants to be shown details of a million pound mansion; without a rough guide, property portals risk being a hindrance to both buyers and sellers. Not the reputation they're after. Dodgy marketing that targets the wrong type of buyer isn't what you want, especially if you're after a fast house sale.
So despite the initial appeal behind a POA property sale, we'd urge you to read in-between the lines, because (reality check), there's a VERY good reason POA sales are a rare sight. And besides, before you advertise your home POA, you first need to understand why estate agents use it. It's also good to know whether it'll actually help you sell your house fast, or not... (spoiler) different houses require different methods of sale.
After something specific about POA in property, or just fed up of asking 'what does POA mean?' Use the menu below to find the answers you need, FAST...
- What does POA stand for? Here's its meaning in property
- What is POA in renting?
- Why do estate agents use POA?
- What's the alternatives to Price On Application?
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What does POA stand for? Here's its meaning in property?
POA in property stands for Price On Application, or Price On Asking, although both essentially mean the same thing. In short, marketing a property as POA means that any buyers will have to approach the estate agent for further detail on the price. A tactic which while effective in some instances, has proved itself to be controversial amongst buyers and agents alike.
A common use of POA is if a property is in some way individual, custom or bespoke. Reason? It allows you to play your cards close to your chest, and gauge how it'll be received by buyers before setting an asking price. Will buyers be fighting over it's individuality, or will it be a major put-off? Market a house as a POA property and you have a good chance of finding out, without over or underestimating its value. Hence why this same pricing strategy is often used in the sale of exotic cars and other luxuries like yachts too.
FYI: Don't confuse POA in property with its meaning in the business world: Power Of Attorney. Yes, if you're selling a house when your partner has been sectioned then this form of POA may crop up, however for the most part, POA in property will relate to your asking price.
What is POA in renting?
POA in renting is much the same as when selling, only instead of buyers it relates to tenants. So any rental that's labelled POA will require potential tenants to contact the letting agent to find out the size of the rent.
You'll usually find POA in renting being used to market new developments, which are being let for the first time, or those rentals which have proven to be particularly popular with tenants. The idea being that a landlord can use POA to almost gauge what renters are prepared to pay, and in doing so pit tenants against each other to get the best possible price.
However, unlike with sellers, POA is used by landlords across a vast range of properties, be they small or overly grand. Whereas in sales, it's likely you'll see POA as you stretch towards the more upper end of the market.
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Why do estate agents use POA?
Estate agents don't just use POA out of the blue; there's a whole variety of reasons behind its use. Some are focused on achieving a better price, while others are products of their own uncertainty. If an agent recommends you go down the POA route, we'd be cautious before nodding your head.
Besides, before you do so, you at least need to have a good idea as to why they'd suggest the selling a house POA. Otherwise you risk listing your property POA for all the wrong reasons - not ideal. So to help you assess estate agents and wrap your head around both sides of the POA debate, we've listed just a few pros and cons for you to consider...
The pros of advertising a house POA
POA prevents buyers spotting downward trends in price
It's worth remembering that not every market bottoms out at the same price, so while the media may state that property prices in Area Y have slumped by X, that's not to say there's been a price rise across the board. It's an average after all. So for instance, this could mean that smaller houses have become more popular (i.e. shot up in price), while larger properties in more affluent parts have suffered a price drop. Something that sellers of these larger homes can tactically disguise by advertising their property as POA.
Advertise POA and your asking price is on a 'need to know' basis
We all know how nosey the paps are. If an influential person so much as picks their nose, it's plastered across the front page of a red top tabloid. So when it comes to an influential person selling their house, privacy is key. In other words, POA could actually be a good deterrent when it comes to 'laying low' and keeping it discreet. Although that's not to say you have to have a seven figure net worth to sell POA. You could simply do so to avoid nosey neighbours if you do so wish.
FYI: While selling POA is a good deterrent, it won't stop any prying eyes from finding your sale price once its published on Zoopla. That is unless you approach Zoopla direct and request for it to be removed.
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POA properties feed a buyer's ego
While POA doesn't have this effect on everyone, there are a select group of buyers (usually those with a BIG ego), who relish in the fact that they're bidding on a property labelled POA. You know the type - the ones who order home delivery just so the neighbours can see the Waitrose delivery van. And that's because bidding on a POA property comes with an heir of exclusivity, which you don't get with the everyday property sale. If anything, you could say it lulls a buyer into thinking they're part of some extravagant secret. One which could in some instances, deter a buyer from negotiating too heavily on the price, in fear of losing their bragging rights.
Market a house POA and you don't expose any price reductions
Opt for the POA approach to selling your property and you could have a significant advantage over other sellers. As with POA you don't display a price in the public eye, the vast majority will not be able to tell when your house has been reduced. So in a sense, by advertising POA you're weakening a buyer's hand in negotiations, as they're unable to gauge how motivated you actually are. Yes, they can still make a vague guess based on your time on the market, but providing you act cool and collected in person, they're virtually clueless. Therefore, if they've taken a real shine to your house, they're less confident when it comes to challenging you on price. POA really hammers home the fact that information is power.
Quirky properties gain a more honest price when sold POA
For those selling an individual property, perhaps a character home, pricing even for the estate agent can actually be quite a task. So by advertising a property POA you can keep it vague and almost get a feel for its true value to buyers in the market. Remember, just because you're selling POA, it doesn't mean you have to specify a figure. At first you could instruct your agent to simply say "at the moment, the sellers are open to offers" - i.e. basically throw the "what's it worth?" question back in the buyer's face and ask for their own opinion. Do this a couple of times and pretty soon you'll have a more accurate idea of where best to market a quirky property like yours.
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The cons of advertising a property Price On Application
POA properties gets you as a seller some rather shady looks
Marketing your property POA isn't exactly following the crowd - not a bad thing, but it can certainly cause a buyer's eyebrows to raise. To understand why, you have to look at it from their perspective. As a buyer, if 99% of sellers on the market are disclosing their price, then why aren't you? What makes you or your property different? Immediately you've got questions flying at you left, right and centre, before a viewing has even been arranged. Remember: a good chunk of buyers aren't even aware of what POA means, so for all you know, they could think POA is another form of caveat emptor (AKA you trying to 'pull a fast one').
FYI: When selling through the open market, trust is vital. If trust breaks down between buyer and seller then there's a high chance of buyers not offering or worse, breaking the chain later on in the sale.
Selling a house POA creates an extra barrier
While it's often argued that selling POA takes focus off the price, the opposite is also true. In fact, by disguising the price, you can argue that in the buyer's eyes, it becomes more of a focal point. And that's only natural - as humans we're nosey creatures, so anything we don't know, we instinctively try to find out. Hence why it's often argued that POA acts as an unnecessary barrier between the buyer and seller, rather than the 'hype builder' it's meant to be. In the case of buyers today, this is often a barrier they can't bothered to break, unless of course it's their dream house.
NOTE: In our time in the industry we've come across a good few cases where buyers have misinterpreted the meaning of POA. If a buyer thinks POA means 'Price not Officially Announced', or something similar, then they're hardly going to be inclined to enquire.
POA can deter buyers with a strict budget
For the majority of homeowners, budgeting is essential, especially for those who'll be relying on a house repayments. Exactly why on more or less every property portal you'll find a tool that allows buyers to get a rough house repayments calculation, directly underneath your property. Label your property POA however and you'll lose access to this feature. All of which could quite easily cause any budget-minded buyers to take their search elsewhere. Not what you want.
Creates unnecessary work for the agent
There's a good reason why the majority of agents are against Price On Application, and it's not just because it's a risky strategy. To an agent, time is money - literally. So as you'd imagine, no agent wants to be having the same recycled conversation with multiple buyers, only to find that the price puts 99% of them off. Something that marketing a property with the price would avoid, meaning that any buyers who do reach out are likely to be at least the tiniest bit motivated - i.e. are a somewhat useful lead that's worth their time.
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Does POA actually work? Will you sell your house faster & for a higher price?
POA isn't perfect, but that's not to say it doesn't work. Well, in certain instances.
So, in the case that you're an influential person - the Fern Cottons and Jamie Redknapps of this world - then advertising your property POA would be a superb way to obscure your finances from the prying eyes of the public. Equally, it's also a great option for anyone who's just straight-up wealthy and wishes to remain 'under the radar' too. Hence why if you ask us, Price On Application has more or less become a universal sign that an asking price is set at seven figures.
Ideal if you're in the mid-900s and pushing for a million, or you have a quirky property that could be worth that sort of money to the right buyer. But for the average homeowner, POA's pretty much useless. Yes, of course there's always that argument that POA is great for weeding out those serious buyers with the cash to splash from a crowd of nosey onlookers. Which is indeed true - if we were selling a mega mansion, POA is definitely a strategy that we'd consider. However, for the average homeowner selling a 3-bed semi, it's not going to be all that effective. Why? They're chasing a different type of buyer.
And this is the thing - sell a property that's under a million and there's a very low chance that you'll find someone who's cash ready and willing to splurge it. So as you'd imagine, to this penny-pinching price-conscious breed of buyer, the figures are just as important as the home itself. Usually because they have a strict amount of cash or a limit on how much they can borrow. Hence why for the everyday property sale, POA is more an inconvenience than a tactic.
Not only does it deter buyers from enquiring, but it also confuses them if there's not much in the way of comparables on the market. All of which erodes a buyer's trust and reflects badly on you as a a seller. Trigger this from the start and it could be the cause of chain break later down the line.
What's more, it bogs your agent down with petty questions, so they have less time to spend on actually finding you a buyer. And even if you are price-sensitive, your sale price will be broadcast to the nation anyway via platforms like Zoopla, so is there really any point?
We'd say there's not, unless of course you're selling an above average house. Doesn't sound like you? Avoid a POA property sale at all costs. Being a cash buyer of property ourselves, we've seen first-hand the frustration that comes with wrongly marketing a property as POA, and often have had to step in to pick up the pieces.
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What's the alternatives to Price On Application?
It'd be daft to tell you that POA isn't the way to sell your property, without providing you with some valid alternatives. If that was the case, we couldn't really call this advice, more regurgitated information. So what with POA not exactly being the express route to a fast property sale, here's some other sales options for you to consider....
- Sell through an agent (without POA) - While we wouldn't advise it, you could remain on the open market with an agent and sell your property using the 'traditional' method of sitting on an asking price with crossed fingers. Because it's the route that most people take, you'll have a LOT of competition. Your sale will likely be slow too, as you're dependant on the demand of the open market, which let's face it, is never constant. On top of this, they'll be more on you (viewings/ negotiations etc.) and then when you do get an offer, it'll likely be a cut under your asking price. Yes, if you've sold before the process will be familiar, but apart from appeasing your comfort zones, we find it hard to fathom many other benefits.
- Take a trip to auction - Another alternative to a POA property sale would be to sell it through your local auction. And while doing so usually proves to be quicker than the open market, the marketing process will still be pretty lengthy - a couple of months on average. Go to auction and you'll be subject to a whole raft of fees including: marketing fees, registration fees, sales fees too. Not exactly the cheapest way to sell your house. Then again, just like through an agent, if you go to auction there's no guarantee that you'll sell it.
- Approach a cash buying company - If neither of the above peak your interest, then selling your house direct to a cash buying company (like us), may be something to look into. Do so and you'll avoid the HUGE wait times that come with selling on the open market. While at the same time avoiding all the sorts of fees that come with auctions too. In fact, we pride ourselves on being fee-free and muscling you through to completion in as little as 7 days - no POA needed!
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What's more, our team have over 50 years' experience in purchasing property direct from vendors across England and Wales, all for CASH! So as you can imagine, anyone who chooses to sell their house to TPBC, will be guided through the process step-by-step, as well as offered assistance with negotiating their onward purchase, providing of course, they ask nicely.
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