2020 brought us *lots* of things – and one of those being the rise of Expression of Interest campaigns within the real estate arena. With new REA data showing an 110% increase in Victorian EOI campaigns from the previous year, you may be wondering how and why this is becoming many vendors preferred method of sale.
We’re here to give you the run down on what they are, how they work and why this option may be the best option to target buyers for your home.
What is an EOI campaign?
Expression of Interest campaigns combine features of private treaty and auction inviting prospective buyers to submit their highest and best offers in writing. Like a private treaty, EOI campaigns allow for negotiations around sales price and conditions and a more confidential sales process, with buyers not knowing who or what their competition is putting forward. But just like an auction there is an end date, creating more of a competitive environment as buyers may only have one chance to secure the property with their offer.
Submitting an EOI
Submitting an Expression of Interest is done using the agent’s provided form by the nominated closing date and time. Forms are submitted to the selling agent and include the prospective buyer’s suggested purchase price, deposit, settlement date and any other special conditions.
Although there may not be a price advertised with the listing, having an EOI campaign doesn’t mean there isn’t a price guide – this can be found in the Statement of Information. Along with 3 comparable sales for reference where possible, the Statement of Information includes the indicative price as either a single figure or price range to give prospective buyers a gauge of price expectations to consider when making their offer.
How EOI’s work.
After the campaign’s end date, the selling agent will present the vendor with all the submitted Expressions of Interest. Submitting an Expression of Interest is not an offer or a legal contract – they are the start of the negotiations between vendor and buyer. The property is not sold until a formal contract is signed by the property owner and buyer and exchanged between the two of them. The vendor (with the assistance of their agent) will determine which Expressions of Interest they will choose to continue negotiations with. This is why it’s important to put your best offer forward to stand out among the other prospective buyers.
Why do they work?
Not every seller wants the publicity of an auction campaign and not every buyer wants or has the ability to bid at auction. Your method of sale needs to compliment your home to get the best result – if your likely buyers are families they may be subject to finance and other conditions as opposed to investors who can move quickly through the sales process.
Considering which method will capture the largest pool of buyers for your property is critical in getting the most money at the end of the campaign. EOI campaigns give buyers the chance to put their best offer forward without the pressure and spotlight of bidding at an auction. With the greater flexibility of EOI campaigns, it allows for vendors to take into consideration other factors beyond just the money and allows the vendor to take the best offer based on what matters most to them.
Combining some of the best features of both private treaty and auction, an Expression of Interest campaign creates a competitive environment without compromising on privacy, and leaves space for negotiations.
If you’re thinking of selling, talk with your agent to see if Expression of Interest campaign is right for your property and have buyers eager to secure your home at your dream price.