As a buyer, you have to make the lowest price possible on a dream house to have a great deal. But having an initial offer that is lower than the asking price can discourage the seller from negotiating any further. In fact, this is pretty similar to making a good impression as you have to entice the seller to arrive at a compromise agreement that will be beneficial to both parties.
So if you’re asking yourself “how much lower should I offer on a house asking price?”, then you’ve come to the right place.
Though there is no exact science to this process, there are certain tricks you can follow to improve your chances of purchasing that house below the asking price. And we’ll talk more about this in today’s article.
How Low Should You Go?
As mentioned, there is no rule of thumb or a precise method of making an offer below the asking price. Because the fact of the matter is, it actually depends upon the present condition of the market you are in as well as the decision of the seller.
But just to give you an idea, if you are located in an area where the real estate market favors buyers, then you could go as low as 10% below the stated price of the property. However, if you’re located at a place where the market favors sellers, then it’s recommended not to go beyond the 10% less offer.
On the other hand, if there are many buyers interested in the house or the property is “in-demand”, then it will be more challenging to go lower than what the seller is asking since they are always looking for the best deal that they can get from the sale. So it’s more likely that they will immediately grab the highest offer (or with terms that are most beneficial to them, in some cases) that will be presented to them.
Moreover, real estate experts won’t recommend going as far as 25% less than the asking price as is this will put off the seller to even consider your offer knowing they can get more from other potential buyers.
But on the flip side, there are also certain instances when the seller will still consider your offer even if it’s 25% less than the original price. Hence, the decision rests upon the seller in this case.
Tips To Follow When Making An Offer Below The Home Seller’s Asking Price
Here are some things you need to remember when proposing a lower price below the seller’s asking price:
- Find Out What Matters To The Seller – Try to know the reason why the seller is selling his/her house. This way, you’ll be able to negotiate a term that will also be more beneficial to them aside from the dollar amount like offering take out stuff that they can’t haul away themselves or allowing the seller and his/her family to stay a few weeks more after buying the house.
It’s all about making your offer more enticing despite being less than what they are asking.
And once you are able to purchase the property, be sure to be flexible and give them enough time to pack and move to their new home.
- Limit Contingencies – Accepting to buy the house ‘as-is’ is like music to the ears of the seller. So it’s recommended to limit any contingencies as much as possible. Or if contingencies are not entirely excluded, then perhaps you can consider reducing the timeframe for this to be completed.
- Offer To Pay In Cash – Being able to pay in cash is more appealing since it shows how financially stable you are as a buyer. And of course, the seller will more likely accept your offer if you do this since they will always want to receive your payment in large bills.
- Consider Homes That Have Been Posted Longer – And lastly, you should choose to buy a house that has been posted longer as this will indicate that the seller is not having much success selling his/her property yet. And as a result, they’ll be more motivated to accept your offer even if it’s slightly lower than the asking price.