In a buyer's market, it can be reasonable to offer as much as 20% under the asking price if the home requires extensive repairs, such as replacing the roof or if there are foundation issues. Offers of 5 – 19% under price are also acceptable depending on the need for remodeling or upgraded appliances.
What is a competitive offer on a house?
In a seller's market, a competitive offer could include a large earnest-money deposit, a preapproval letter from a lender, extra time for the sellers to move out, or waived contingencies.
What is too low of a bid on a house?
“The rule I've always followed is to never go more than 25% below the listed price,” he says. “Chances are, after fees, commission, and sentimental value, the sellers are already hurting. If you dip below that point, they may disregard your offer entirely.”
How much less should you offer on a house when paying cash?
Offering 1% to 4% below asking may not seem like a lot of savings when you're spending hundreds of thousands of dollars, but the reduced price will make your mortgage payments less every month. You may want to offer below 5% when you're paying with cash or when the market is more balanced.
How do you calculate a good offer on a house?
- What have similar homes sold for? That's right!
- How long has the home been on the market?
- What's the condition of the home?
- How flexible are you on price?
How do you judge how much to offer for a house?
- Figure out how much you can afford.
- Understand how the market looks.
- Research how much comparable homes have sold for.
- Get a sense of the property's condition.
- Check how long the listing has been up.
- Decide where your offer should fall.