A major challenge involved with selling your property is understanding all the different terminology. When you are working with estate agents and conveyancers, you may hear them use acronyms or terms that you aren’t familiar with.
This is completely normal!
But if you are worried about feeling blindsided, We Buy Any Home can help. In the blog below, we have explained everything you need to know about a common acronym in the property field: ‘POA’.
What Does POA Stand for?
‘POA’ in property stands for ‘Price on Application’. This is an acronym which you will commonly see on property-selling websites, such as Zoopla, on more expensive houses.
This means that the price of a property is hidden from general view – and it will only be revealed to people who submit an application.
Why do people use a POA?
A POA is typically used on properties which are more expensive than the average home. The homeowner may want to keep the price of the property a secret, and therefore only reveal it to people who are interested in purchasing the house.
Using a ‘POA’ aims to make a property seem more exclusive (and illusive!). It is a way of attempting to tantalise prospective buyers and lure them into submitting an application – which, for estate agents, is half the battle.
A property may also be listed under POA if there is an ongoing dispute between an estate agent and a vendor on the price of the property. If a specific price cannot be agreed, setting a POA enables the estate agency to begin accepting applications, while they set about getting a final price agreed.
Can I work out the price of a POA property?
Although setting a ‘POA’ aims to deter people from finding out a property’s value, it is not always difficult to work out what the figure would be. On property selling sites, for example, whoever sets up the POA listing will have to register a ‘secret price’ with the website, even if that price is not shown to the general public.
This means that the property will show up within a similar price range to other properties of the same value. For example, if the house is valued at £1,500,000, it will typically appear with other properties with the same value. Therefore, you can look at the prices of the properties above and below it to get a good idea of the price.
Why is POA used in renting?
Estate agents do not only use POA when selling properties outright – you will sometimes see POA used in renting, too.
If a POA is used in renting, it means that the potential tenant must contact the letting agent, in order to find out how much the monthly rent will be.
Some landlords use POA in renting because they want to gauge how much the renter is willing to pay. For example, if the rent was going to be £1,000 per month, but they find out through conversation that the potential tenant’s budget is £1,200, they may increase the figure to get more money. This is widely agreed as unethical – and is a key reason why some prospective tenants do not enquire with POA renting opportunities.
Does POA work?
In the experience of many independent property experts, a POA is unlikely to work.
Firstly, it is often very straightforward to estimate what the property would be worth. On websites such as Zoopla, RightMove or OnTheMarket, a POA property will be listed with other houses of a similar value, and therefore the aim of hiding the house’s value becomes slightly pointless.
Secondly, while estate agents try to use a POA to increase a house’s ‘exclusivity’, it often does not have this affect. Many potential buyers simply cannot be bothered to pick up the phone and enquire about the price of a house – and therefore, to save time, they would rather focus on properties where the price is already known.
Furthermore, some prospective buyers decipher that if an estate agent is having difficulties agreeing with the vendor on the house’s value, then this may indicate that there will be further difficulties down the line. While it cannot often be determined if this is the true reason for the POA, it can still be a deterrent.
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