Imagine this: You’ve spent weeks preparing your home for sale—staging every room, hiring a professional photographer, and pricing it based on the market. Then, the first offer comes in, and it’s insultingly low.
Your gut reaction? Frustration. Maybe even outrage. But before you dismiss the buyer outright, take a deep breath. Lowball offers are common in real estate, and how you respond can make the difference between salvaging a deal or watching a potential buyer walk away.
This guide will equip you with smart, strategic ways to handle lowball offers, turn them into meaningful negotiations, and ultimately get the best possible price for your home.
Why Do Buyers Make Lowball Offers?
1. Testing the Waters
Some buyers submit low offers just to see if you’re desperate. They may assume you’re in a rush to sell, financially struggling, or unaware of your home’s market value. These buyers often leave room to negotiate, so your response matters.
2. Misinformed or Bargain Hunters
Other buyers may genuinely believe their offer is fair, possibly because they’re looking at outdated or inaccurate comparable sales (comps). Some are simply bargain hunters hoping to score a deal—especially in a buyer’s market.
3. Market Conditions Favor Buyers
If the market is slow, buyers may feel empowered to negotiate aggressively. High inventory, economic downturns, or seasonal slowdowns can encourage buyers to lowball sellers in hopes of getting a discount.
Understanding a buyer’s motivation is key to crafting a smart, strategic response rather than reacting emotionally.
Step 1: Stay Calm and Assess the Offer Objectively
Your first instinct might be to reject the offer outright, but that could be a mistake. Every offer—even a low one—represents a potential buyer. Instead of reacting emotionally, look at the numbers strategically.
1. Compare the Offer to Market Value
Ask yourself:
- Is the offer way below market value, or just slightly under?
- Have other homes in your neighborhood sold for a price close to this offer?
- Is your home priced competitively, or is it slightly above market rates?
If your home is overpriced, even a lowball offer could be a buyer’s attempt to bring it down to fair market value.
2. Consider the Buyer’s Terms
Sometimes, a lower offer might come with better conditions. For example:
- A cash offer with no contingencies might be worth considering even at a lower price.
- A buyer who is willing to close quickly could save you time and carrying costs.
- Fewer conditions, like waiving a home inspection, can reduce future risks.
If the terms are favorable, it may be worth negotiating rather than rejecting outright.
Step 2: Respond with a Counteroffer, Not Emotion
1. Counteroffer with a Reasonable Price
A well-thought-out counteroffer shows buyers that you’re serious but willing to negotiate. Avoid making a counteroffer too close to your original price—instead, bring it down slightly to keep the conversation going.
For example, if your home is listed at $500,000 and the buyer offers $450,000, instead of rejecting it outright, counter with $490,000. This shows you’re open to negotiating but still expect a fair deal.
2. Justify Your Price with Facts
Buyers need to see why your home is worth what you’re asking. In your counteroffer, include:
- Recent comparable sales (comps) of similar homes in the area.
- A list of recent upgrades and renovations that add value.
- The unique features of your home, such as a larger lot, updated kitchen, or premium location.
This shifts the conversation from an emotional standoff to a data-driven negotiation.
Step 3: Create a Sense of Urgency
1. Let Them Know There’s Other Interest
Even if you don’t have multiple offers, hinting at strong interest can push buyers to act faster. Phrases like:
“We’ve had significant interest in the property, and we’re reviewing offers this weekend.”
This puts pressure on the buyer and signals that you won’t accept just any offer.
2. Set a Deadline for Negotiation
Instead of letting negotiations drag on, put a time limit on your counteroffer. Something like:
“We appreciate your offer. We’re willing to accept $490,000, but this counteroffer expires in 24 hours.”
This prevents buyers from shopping around or delaying a decision, increasing your chances of closing the deal quickly.
Step 4: Know When to Walk Away
1. If the Buyer Won’t Budge
Some buyers will refuse to negotiate, insisting their low offer is the best they’ll do. If their price is well below market value and they won’t meet you halfway, don’t waste time—move on to more serious buyers.
2. If You’re in a Strong Seller’s Market
In a hot market, where homes are selling quickly, you don’t need to entertain unreasonable offers. Instead of negotiating endlessly, focus on marketing your home to attract better offers.
3. If You Have Room to Wait
If you’re not in a rush to sell, waiting for the right buyer may be the best strategy. Sometimes, rejecting a lowball offer sends a message that you’re confident in your home’s value, and serious buyers will step up.
Final Thoughts: Turn Lowball Offers into Opportunities
Lowball offers are frustrating, but they’re not deal-breakers. By staying calm, countering strategically, and justifying your price with market data, you can turn a weak offer into a strong negotiation.
Remember: Every offer is an opportunity. Even if it starts low, with the right response, you can still land a deal that works in your favor.
Thinking of selling your home? The Tar Team specializes in smart negotiation strategies that get sellers top dollar. Contact us today to get started!