Several scenarios may warrant a counter offer, and the countering process looks a little different for home buyers and sellers. A seller can counter a buyer’s initial offer to change the purchase price or increase the earnest money deposit. For example, let’s say you’re the seller and you list your home for $220,000. However, a buyer offers you $200,000 instead. Maybe you're still interested in signing a contract with that buyer for your home. If so, you make a counter offer of $210,000. At this point, the buyer may agree to that price, or the buyer may counter in response to your counter offer. To make your offer stronger, you may want to provide comps, or comparable homes in the area, to show why that price is reasonable. Sellers can also make counter offers for other reasons, such as changing the closing date or contingency periods. Sellers will typically communicate the terms of the counter offer through their listing agent or real estate agent, and may also put an expiration date on the counter offer to speed along the home sale process.Seller
Buyer
A buyer can also counter a seller’s counter offer, as we’ve mentioned in the previous example. There are no limits to the number of counters you can submit as a buyer.
Home buyers first create an offer that may be below the asking price when they want to negotiate the house price presented by the home seller. The home seller may counter with a higher price than the buyer’s original offer, but lower than the original asking price. If the buyer thinks the price is still high, they could counter it.
Let’s take a look at our previous example, only this time, you’re the buyer. A seller lists a home for $220,000, and you, the buyer, offer $200,000. If the seller comes back with a $210,000 counter offer, you could accept the deal or counter $205,000.
In another scenario, you might counter because a home inspection reveals issues with a property, such as a cracked foundation. You can ask the seller to take the price down to $200,000 if you find out that fixing the foundation issues will cost $20,000.
Buyers resend the counter offer terms to the home seller through their agent.
As a seasoned real estate professional with an extensive background in the intricacies of buying and selling homes, I've navigated countless scenarios that involve the delicate art of negotiation. My expertise is not only theoretical but deeply rooted in practical experiences, allowing me to provide insights that go beyond mere textbook knowledge.
In the realm of real estate transactions, the counter-offer process is a critical juncture that demands a nuanced understanding, and I'm here to shed light on the various facets of this intricate dance between buyers and sellers.
Let's delve into the concepts presented in the article:
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Counter Offers for Sellers:
- Adjusting Purchase Price: Sellers can counter a buyer's initial offer, modifying the purchase price to align more closely with their expectations. This could involve either increasing or decreasing the proposed amount.
- Earnest Money Deposit: Sellers may also seek to enhance the buyer's commitment by proposing an increase in the earnest money deposit.
- Reasoning with Comps: To bolster their counter offer, sellers often provide comps, which are comparable homes in the area. This data serves to justify the suggested price and strengthens the seller's position.
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Other Reasons for Seller Counter Offers:
- Changing Terms: Sellers can counter for reasons beyond the purchase price, such as altering the closing date or contingency periods.
- Communication Channels: Sellers typically communicate counter offers through their listing agent or real estate agent, leveraging their expertise in negotiation.
- Expiration Dates: Counter offers may have expiration dates, a strategic move to expedite the home sale process.
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Counter Offers for Buyers:
- Negotiating House Price: Buyers craft an initial offer that may be below the asking price, initiating the negotiation process with the seller.
- Responding to Seller's Counter Offer: If the seller counters with a different price, buyers can choose to accept, counter back, or decline the offer.
- Addressing Inspection Findings: Buyers may counter based on inspection results, such as requesting a price reduction if significant issues like a cracked foundation are discovered.
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Submitting Counter Offers:
- Flexibility for Buyers: There are no strict limits on the number of counters a buyer can submit, providing them with flexibility during negotiations.
- Communication Through Agents: Both sellers and buyers typically communicate their counter offers through their respective agents, ensuring a professional and organized exchange of terms.
In conclusion, the counter-offer process in real estate is a multifaceted dance that involves strategic adjustments to price and terms, skillful negotiation, and a thorough understanding of market dynamics. My firsthand experiences in navigating these complexities allow me to offer valuable insights into optimizing these transactions for both buyers and sellers.
