Dear Olivia,
I think I’m ready to buy a house. My question is this: when I find the right one, how much should I offer relative to the asking price?
Sincerely,
Want to Buy
This is one of the most common questions buyers ask (especially first-time homebuyers), and for good reason. Nobody wants to overpay for a home, but you also don’t want to lose the right house because your offer missed the mark. The truth is, there isn’t one magic percentage you should offer below, at, or above the asking price. A strong offer depends on the home, the market, and your own goals.
Start With the Market, Not Just the Asking Price
The asking price is important, but it doesn’t automatically tell you what a home is worth or what it will ultimately sell for.
Before deciding what to offer, I look at comparable recent sales, current competition, how long the property has been on the market, and whether there have been recent price changes. A home that was just listed in a competitive price range may call for a very different strategy than one that has been sitting on the market for several months.
This is where local market knowledge matters. Two homes with the same asking price can have completely different circumstances behind that number.
Look at the Whole Offer
Price is only one piece of an offer.
Sellers may also consider your financing, requested closing date, inspection terms, earnest money, seller concessions, and other contingencies. In some situations, a clean, well-structured offer can be more appealing than a slightly higher offer with a long list of conditions.
That doesn’t mean you should waive important protections just to make your offer more attractive. It means we should look at the entire package and decide where you can be competitive without taking on unnecessary risk.
Your offer should also reflect how much you want the property. If you would be disappointed to lose the home over a relatively small difference in price, that should factor into the conversation.
Decide What the House Is Worth to You
Ultimately, the right offer has to make sense both financially and personally.
Before writing an offer, I like buyers to think about their comfortable monthly payment, available cash, potential repairs, and how the home compares with other choices on the market. Just because you can offer a certain amount doesn’t mean you necessarily should. Knowing what you’re qualified to spend before you start making offers can help you set realistic boundaries.
At the same time, trying to “win” every negotiation by getting the lowest possible price can backfire. Sometimes a fair offer on the right home is a much better outcome than saving a few thousand dollars on a house you don’t like nearly as much.
My job is to give you the information you need to make that decision confidently and help you put together an offer that fits both the market and your priorities.
If you’re thinking about buying a home and aren’t sure where to start, get in touch with me at 307-856-3999. I’m always happy to answer your questions and help you understand your options.
~Olivia