Making an offer in Qld and clarification of "offers over"

Hi all,

Had an interesting conversation with a REA in Kallangur this morning...

The REA claimed that if a property in Qld was advertised with "offers over" a certain price, then the maximum theoretical price should be no more than 10% of the advertised price (referred to some laws specific to Qld). E.g. if a property is listed at offers over 300k, the maximum theoretical price would be no longer than 330k. Is the REA pulling my leg?

He also had a polite chip at me for making offers below the listed price, and my reply was that I was trying to secure an investment that provides 6% rental return. Not unreasonable isn't it?

 

I see offers more than 10% over all the time, that doesn't make it unlawful.

It is if the agent is advertising it at less than the vendor's minimum price (on the form 6) then it can be bait pricing and bait pricing is unlawful. But if the vendor's minimum price is $500k and the agent lists offers over $500k then it is unlikely to be bait pricing even if contract goes for more than 10% above that.

 

HI RPI,

Thanks for the insight.

Cheers,

Ed

 

I see properties asking offers over selling for 'offers less' from time to time.
However the usual scenario plays out like this:
Usually agents/vendors price them so that 'offers over' price is the floor price and then it is the best offer over that they go with. That's the 'usual' protocol/intent.

 

Gone are the days where people would list the price that they are happy to sell the property for. It appears that the more properties I look at for sale, the more I see that are "offers over", "auction", "contact agent" or "submit all offers". Depending on the purpose of the property but if it's an IP, I'd still make an offer based on numbers that's for sure.

 

I bought my last IP in Margate for $410,500. It was listed as "offers over $419,000".

 

It's a free market, you can offer what you want! The stipulations are placed on the agent in relation to bait pricing (laws are generally the same but vary from state to state - usually more so in how much they're policed!) and to my knowledge, the 10% "rule" applies in Victoria, not Queensland.

If you want to offer $5 and the vendor accepts then good on you! Agents will notoriously try to quote anything whether it's true or not to try and pull the wool over a buyer's eyes and sell a property. It's great that you're not taking him on face value. Good luck!

 

Agree. Your focus should always be on assessing the fair market value. All the rest is fluff to be ignored and just part of the game.

 

Well according to my local REA(Wynnum/Manly/Gumdale Bayside brisbane, who has been in the business for over 30 years). Houses here list in a range of around 5% above the market value price.

So for example, if a house listed at offers over 840k for example(5% above market price), owners are hoping to get that or more. Of course depending on how keen vendors are to sell, if they don't get the offers over price in the first few weeks, they will accept offers less than their offers over price since those offers would still be above the market price and above their minimum sell price.

The advertising progression usually goes as such over here for nice houses.
1st month -> Starts off with annoying no price listings with All offers considered/By negotiation (gets those emotional buyers, if you ask for a price they will give you the offers over price)
3rd to 6th week -> offers over (for the general market)
last month -> fixed price (usually a small discount from offers over price.)
after which if no sale we will see a change of agent.

So when you see offers over 840k, an offer of 820k(2.5% less) but still 2.5% more than market price) will get the deal done pretty quickly. same if the house is offers over 600k, 585k will easily get the deal done most times.

 

Refreshing to hear this.