How To Negotiate House Price: A Guide for Buyers
Knowing how to negotiate a house’s price can help you land your dream home while staying within your dream budget. With some upfront preparation and research, you can avoid overpaying or, in a worst case scenario, offending the seller and losing out on the house altogether.
Nearly 80% of properties sold at or below their list price, according to the National Association of REALTORS®’ July 2025 Confidence Index — which means there’s a real opportunity for buyers who can approach negotiations strategically. We’ll share some essential negotiation tips and ways to strategize based on your specific homebuying situation.
- Know the market. Use recent comps Comps (comparable sales) are nearby properties that sold recently and share similar characteristics to the home you’d like to buy. Comps help determine a fair market value for the home you’re buying. to justify your offer price.
- Make your offer stand out. Assess how you can set yourself apart from the pack in your area’s market.
- Negotiate closing costs. Many sellers will cover a portion of closing costs to seal the deal.
- Leverage timing. Aim for homes that have sat on the market longer or have recently seen a price cut.
- Stay flexible. Offer a closing date that works for the seller.
- Use concessions wisely. Instead of lowering the sales price, ask for appliances, warranties or upgrades.
- Ask for repairs. Request fixes or credits after the home inspection comes back.
How much can you negotiate on a house?
Depending on your market and the specific home, expect to negotiate somewhere between 1% and 5% off list price, plus 2% to 6% of the home price in closing cost help or repair credits.
The majority of homebuyers do successfully negotiate. More than 6 in 10 (63%) respondents reported negotiating a price reduction, according to LendingTree survey data, and many also secured seller-contributed closing costs or repairs.
How much you can negotiate is, of course, likely to vary by market conditions:
- Hot markets: Sellers often hold firm, expect discounts closer to 1% to 2%.
- Slower markets: Buyers gain more leverage, expect discounts of 4% to 5% or higher.
- Closing costs: Nearly 40% of LendingTree users reported negotiating seller-paid costs. Typical closing costs run about 2% to 6% of the purchase price, so even partial seller contributions can save you several thousand dollars.
Tips to help you negotiate a house price
1. Know the local market
Having upfront knowledge about the market you’re buying in can help you set boundaries and understand the seller’s strategy. Here are key points to research:
- Details about nearby home sales. Ask your real estate agent to provide a comparative market analysis (CMA). A CMA details the sales price for similar homes in the area, how long it took for them to sell and how close the final sales price is to the listing price.
- Whether you’re in a buyer’s or seller’s market. In a seller’s market, there are more buyers than available homes. This typically means you have less negotiating power, as sellers get to entertain multiple offers. A buyer’s market is the reverse: There are more homes than available buyers, so sellers are more likely to offer closing cost credits or other incentives to make their homes more enticing.
- How much you can borrow. If you need a mortgage to buy a home, have your mortgage preapproval letter ready before you make an offer. This will tell you how much you can borrow and lets the seller know you’re a serious buyer.
2. Make your initial offer stand out
You only have one chance to make a first impression. While an offer far above asking price will certainly help you stand out, it’s not the only way you can make your mark:
- Offer a larger earnest deposit. Earnest money is a portion of the home price that you pay upfront, and you can think of it like the real estate version of putting your money where your mouth is. Sellers may take your offer more seriously if you’re willing to show that you have more skin in the game.
- Make a bigger down payment. A 20% down payment or higher can signal to the seller that you have additional financial resources. Sellers want to work with a buyer that won’t fall through, and they know that deep pockets can help facilitate that.
- Be flexible on your closing date. Some sellers want a quick closing, while others may need to line up the sale of their current home with the purchase of a new one. A little wiggle room on your part could make yours the winning offer.
- Add a personalized letter. Although there’s no guarantee it’ll make a difference, a letter explaining how much you appreciate the home and why they should consider your offer may tug at the seller’s heartstrings — especially if they have an emotional attachment to the home they’re selling.
- Add an escalation clause. If you’re in a bidding war, this type of clause allows you to automatically raise your offer (up to a maximum limit) if a competing offer comes in.
Negotiations 101: How to respond to counteroffers
If the seller doesn’t accept your initial offer, they may make a counteroffer. In other cases, the seller could accept your first offer, but problems down the line — like issues uncovered during a home inspection or appraisal — can send you back to the negotiation table.
How to negotiate a counter offer
Typically, a seller might counteroffer in one of five ways. The table below shows how you can respond to each:
| Type of counteroffer | How you can respond |
|---|---|
| Higher sales price |
|
| Change in closing date |
|
| Reduction or rejection of seller-paid closing costs |
|
| Rejection of other contingencies |
|
| Higher earnest money deposit |
|
What should you never say when negotiating?
- Don’t reveal your financial limits. Never say “This is the most I can afford” or mention your maximum budget. This immediately caps your negotiating power and tells the seller exactly where your ceiling is.
- Avoid showing desperation. Don’t say things like “I have to have this house” or “I’ll do whatever it takes.” Desperation weakens your position and can lead to overpaying.
- Don’t disparage the property. While you can point out legitimate concerns, avoid being overly critical. This can offend sellers and make them less willing to negotiate.
- Never mention other buyers. Don’t say “I know there are other offers” or acknowledge competing bidders. This only reinforces that the seller has leverage.
- Avoid timeline pressure. Don’t reveal urgent deadlines like “I need to close by next month” unless absolutely necessary, as sellers may use this against you. If you’re buying and selling a house at the same time, make sure you have a strategy that doesn’t depend on everything timing out perfectly.
Negotiating after a home inspection with issues
If the home comes back with home inspection issues, your negotiation options include:
- Requesting repairs. Decide if you want every inspection issue fixed, or if it makes more sense to focus on a few important items (like a leaky roof or exposed electrical wires).
- Adjusting your purchase price. This is essentially making a counteroffer to offset the cost of the needed repairs. Your real estate agent should give you guidance on how much of a reduction to request.
- Asking for a closing cost credit. Find out if the seller is willing to pay a percentage of your closing costs equal to the estimated cost of repairs, then make the fixes after buying the home.
- Walking away. If the seller refuses to negotiate after the inspection, you can usually walk away and get your earnest money back from escrow.
Negotiating after a low appraisal
Most mortgage lenders require a home appraisal, and if the value comes in below the agreed-upon purchase price, you have four options:
- Pay the difference out-of-pocket. Lenders won’t lend you more than a home is worth. But if you still want to move ahead with the purchase, this may be your only option — especially if you waived all contingencies when you made your initial offer.
- Ask the seller to meet you halfway. This request could just lead to some haggling back and forth, but it’ll tell you whether the seller is willing to compromise. They may be motivated to avoid losing you and restarting the selling process.
- Dispute the appraisal or get a new one. A home appraiser may have missed a recent sale or incorrectly calculated the square footage. You can always discuss disputing the value with your loan officer if something doesn’t look right. You also have the option to order a new appraisal.
- Cancel the contract. If your contract contained an appraisal contingency — great! You played it safe and came out on top, as you can now cancel without losing your earnest money.
Frequently asked questions
You can offer 20% below asking price, but it’s likely to be rejected unless the house is significantly overpriced, has been on the market for months or needs major repairs. Plus, such a low offer could offend the sellers and hurt your chances of future negotiations. A more strategic approach is typically 5% to 10% below asking price, then negotiate from there based on the seller’s response and market conditions.
Your real estate agent likely has a sense of just how low sellers in your area are willing to go. But don’t push it too far — if your offer is so low that it insults the seller, you’ve already lost. Instead of pushing for the maximum amount a seller might come down, try to find a zone of overlap between your interests and theirs. Ultimately, a seller wants to receive a fair and reasonable offer.
This will depend on your financial resources, your motivation to buy the home and the market you’re buying in. In a seller’s market, you can expect to offer over the asking price. If you’ve found your “forever home,” no matter the market conditions, the amount may only be limited by how much you’re willing to spend.
You should walk away if the price is outside of your budget, you feel the seller is being unreasonable or you simply aren’t getting what you need out of the deal. You should also watch out for title issues, deception on the part of the seller or catastrophic problems with the home’s condition.
Your real estate agent will coordinate your offer with the appropriate parties on the seller’s side. The agent typically drafts an offer in the standard purchase contract format for your area, have you sign it in person or electronically and then submit it to the listing agent representing the seller.
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