Should You Offer Less Than Asking Price on a Home?
When you’re buying a home, the asking price is just that: The price the seller is asking. It doesn’t mean that’s exactly what you have to pay. In some cases, it's okay to offer less than what the seller is asking. This guide explains.
Should You Offer Less Than Asking Price on a Home?
First things first: You should always follow your real estate agent's guidance on whether to offer less than asking price, the exact asking price, or more than the seller's asking price. Your agent is familiar with the market (and knows what will work), so it's best to discuss your offer with your agent before you settle on a dollar amount.
With that said, there are times that it's okay to offer below asking price, such as:
- When a home has been on the market for a significant amount of time
- When a home is overpriced, and you and your agent know it
- When a home needs serious repairs
- The sellers are in a rush to sell
Here's a closer look at each.
Situation #1 for Offering Below Asking Price: When a Home Has Been on the Market for a Long Time
If a home has been on the market for longer than a month or two, you might have some room to negotiate. The logic here is that if a home hasn't sold in that time, there may be something wrong with it that's preventing buyers from making an offer.
Related: Which of these five mortgages is right for you?
Situation #2 for Offering Below Asking Price: When a Home Is Overpriced
If you know (through your agent or your own research) that a home is overpriced, you may be able to get it for less than the asking price. This doesn't mean you should lowball the seller, but if you can make a reasonable offer that's below the asking price, the seller may be more inclined to accept.
Situation #3 for Offering Below Asking Price: When a Home Needs Major Repairs
If a home needs significant repairs, you may be able to get it for less than the asking price. This is because the seller will likely need to spend money on repairs, so they may be more willing to accept a lower offer.
Related: Should you buy a fixer-upper to flip it?
Situation #4 for Offering Below Asking Price: When the Sellers Need to Sell Quickly
If the sellers are motivated to sell quickly (for example, they're relocating for a job), they may be more likely to accept an offer that's below the asking price.
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