How To Determine How Much To Offer For A House

How To Determine How Much To Offer For A House

27 May 2019
 Categories: Real Estate, Blog

When the time comes to finally make an offer on a house, you will want to carefully think about how much money to offer for the house you want. The offer amount is critical for the seller to accept it and for the deal to go through but determining how much to offer is not always an easy task. As you make this decision, here are the main things to consider as you determine the right amount to offer to pay for the house you want to buy.

The asking price of the home

The first thing you should always consider is the asking price of the house. While the asking price is just a general guideline for the value of the house, it can be a good starting point for you as you think about this decision.

The current value of the home

While it is important to consider the price the seller is asking for the house, it is much more important for you to determine how much the house is really worth. There is a chance the asking price is spot on with the home's value, but there is also a chance the asking price is way off. If you offer to pay more than the house is really worth, you might not be getting a great deal on your purchase. Additionally, if the house does not appraise for the amount you are offering, you could have a lot of trouble trying to close the deal. Your real estate agent will help you take the right steps to find out the current value of this particular home before you make an offer.

The competitiveness in the market

A third factor to consider is the competitiveness that is currently present in the market. During a highly competitive market for buyers, you will have to keep the offer amount on the higher side. During a slow period, though, you could offer less and still find that the seller will accept it.

The other things you ask for

Your offer amount should also be based on whatever else you ask for. If you ask for money towards your closing costs, you could increase the offer amount a little to compensate for this. If you do not ask for anything, you could offer a slightly lower amount and still have a good offer to give to the seller.

These are the four main factors for you to think about and consider as you try to come up with the right amount to offer. For more information about selling and buying single family homes you should contact a real estate agency for assistance with the process.