Avalon’s Money Thread: What’s all this BBO & BEO nonsence on house adverts?
Do agents always list that the price as BBO or BEO in the ads next to the price (if it applies) or do you only find this out when you make enquiries. From reading this thread and the suggested links it seems that most houses have the BBO or BEO and yet we are not seeing it in the net ads, are we looking in the wrong place?
Many properties don’t have any prices on them. In that case all you really have to go on is the GV/RV (Government or rating values). That’s the value on which the rates are worked out.
The Prices are set as:
Auction
A public sale of property in which prospective purchasers bid until the highest price is reached (or not as often happens).
BBO / BEO
Buyer Budget Over or Buyer Enquiry Over (sort of a guide but as with a lot of this – often nothing like what the seller actually wants). You are supposed to make an offer above this – but theres no law that says you have to.
MWP
Marketed Without Price. Utterly pointless, and I have little respect for agents that use this term.
PBN
Price by Negotiation. Often in my experience the seller then refuses to negotiate.
POA
Price on Application (always says to me “overpriced” but that’s just me!)
Tender
Make a formal written offer for a property by a set date. You often get a “Tender Document” to fill in, but you dont have to use that. This is like a “Dutch Auction” in the UK.
GV / RV
well yeah, but how does that help? It may have been from 2-3 years ago, and still doesn’t tell you how much people want for the place.
A Set Price
My preferred option. It tells you just what you need to know and I’ve noticed you often get this with lower priced properties.
If the ad says tender or auction your only way of getting a guide price of what the seller wants is to phone the agent and try and get a number out of them. I found that this was in no way helpful, even if they did tell you a number. Often they are trying to just get your interest with a silly low number which the seller would never accept and is often nothing like what the agent told the seller the house was worth.
That’s why we got a valuation before we made an offer. This place was advertised with a price (I stopped going to see houses without prices). They wanted $650K, but the valuation came in at $606. So we knew ahead of time that if we could get it at that price, we would not be overpaying.
Also, something that has come up recently regarding investors bringing potential tenants round when you SELL a house here. It’s actually quite common and often investors will put a clause in their offer to the effect that they can bring round potential clients during the settlement period. If you are in this position, bear in mind that if it is in the S+P agreement you need to abide by that, but if it isn’t, you don’t. This is another of those things where I think the advice of a solicitor is worth every cent. They should guide you through every item in the S+P agreement whether you are buying or selling.
Avalon’s Money Thread is a series of posts which were originally written in 2007 for an Immigration Forum. They came about by answering questions that forum members asked, about how to cope with the often difficult financial situation they face in New Zealand. They formed the basis of what was eventually to become the book Avalon’s Guide: after another year or so of drinking way too much coffee and finding out way more about taxes, money and investing that any sane person should.
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Related posts:
- Avalon’s Money Thread: Buying Houses in New Zealand.
- Avalon’s Money Thread – Negotiating Wages.
- Avalon’s Money Thread: Can I Invest In new Zealand?
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