How Much Should I Offer on a House?

One of the most useful places to begin is with recently sold homes that are similar to the property you're considering.

Relevant comparisons may include:

• Location
• Size and layout
• Number of bedrooms and bathrooms
• Lot size
• Age and condition
• Updates and improvements
• Features such as garages, views, pools, or other amenities
• How recently the comparable property sold

The goal isn't simply to find the cheapest comparable home. The goal is to understand how the market has valued properties that are reasonably similar.

Market conditions can affect how much negotiating room a buyer may have. If there are relatively few homes available and multiple buyers are competing for the same property, an offer below asking price may be less likely to succeed.

If a property has been on the market for an extended period, has already had price reductions, orhas other factors limiting buyer interest, there may be more room for negotiation.

These circumstances can change quickly, which is why the same offer strategy doesn't makesense for every property.

The purchase price is only one part of an offer.

The seller may also consider:

• Financing terms
• Earnest money
• Inspection terms
• Appraisal provisions
• Closing date
• Possession or occupancy terms
• Seller-paid closing costs
• Other contingencies

A buyer may have a strong reason to offer less than asking price while still presenting an attractive overall offer.

A common mistake is deciding to offer a certain percentage below asking price without first looking at the property and market.

For example, "I'll offer 5% below asking" doesn't tell you whether the resulting price issupported by comparable sales or whether it makes sense in the current market.

A better approach is to determine what the property appears to be worth, decide how much youare comfortable paying, and then structure the offer accordingly.

The right offer isn't necessarily the lowest possible price or the highest possible price. It is the price and terms that make sense for you and the property you're buying.

If you've already found the home, the next step is turning the information you've gathered into an offer that reflects both your goals and the circumstances of the transaction.

Whether you're deciding where to start, reviewing comparable sales, or trying to determine how much negotiating room you have, professional offer guidance can help you evaluate the numbers before you commit to a contract.