How to Make a Counteroffer When Your Home Is Worth More

How to make a counteroffer as a seller

There’s no standard formula for making a counteroffer. The right response depends on what the home is worth, the strength of the buyer’s offer, your goals, and how much leverage you have in the current market.

McMartin says she looks at the offer as a whole rather than focusing on one number. “There’s really no cookie-cutter way of doing it,” she says. “You’ve got the market analysis of the property, but you also have the terms and the conditions.”

Here’s how to work through those factors before making your counter.

1. Review the entire offer before reacting to the price

Don’t judge an offer by the purchase price alone. A $510,000 offer isn’t necessarily stronger than a $500,000 offer if it comes with more contingencies, substantial seller concessions, or other terms that add cost or uncertainty.

Look at the full offer, including:

• Whether the buyer is paying cash or financing the purchase
• Any financing, appraisal, inspection, or other contingencies
• The earnest money deposit
• Seller concessions or closing costs the buyer wants you to cover
• The proposed closing and possession dates
• Any appliances or personal property the buyer wants included
• How flexible the buyer is on terms that matter to you

Think about what each term means for your bottom line and the likelihood of reaching closing. For example, if your home is vacant, a slightly lower offer with a quick closing could shorten the time you continue paying expenses such as mortgage interest, utilities, insurance, taxes, or HOA dues. Depending on your situation, that may make the lower-priced offer more attractive overall.

2. Recheck what your home is realistically worth

If you think the offer is too low, take another look at what similar homes are actually selling for. Your real estate agent can review recent comparable sales, along with pending sales and competing listings that may provide additional clues about where the market is headed.

Also, look at how buyers have responded to your home. Strong showing activity can be a positive sign, while a longer time on market or repeated comments about price may suggest buyers see the value differently.

Keep in mind that what you need to make from the sale, or what you spent on improvements, doesn’t automatically increase your home’s market value. Your counter should be grounded in what buyers are willing to pay in the current market.

3. Decide on your ideal outcome and your bottom line

Before you counter, know what you’re aiming for and where you’re willing to draw the line. It can help to think in three levels:

• Ideal: The price and terms you’d be happy to accept.
• Acceptable: An offer that still meets your main goals.
• Walk-away point: The point where you’d rather keep the home on the market than make another concession.

Your bottom line may involve more than price. Closing timing, repairs, seller concessions, or other terms could matter just as much depending on your situation.

4. Determine how much to counter

There’s no set percentage or formula for choosing a counteroffer amount. Instead, consider how far apart you and the buyer are, what recent comparable sales support, how long your home has been on the market, and how much interest you’ve received from other buyers.

Simply splitting the difference may not make sense if the market supports a higher or lower number.

If the buyer is financing the purchase, keep the appraisal in mind, too. A counteroffer that pushes well beyond what comparable sales support could become an issue if the home appraises for less than the agreed price. Depending on the contract and the buyer’s finances, that could lead to another round of negotiation.