If you’re an avid Facebook Marketplacer like us, you may have already encountered a lowball offer while trying to sell your old couch or finding the perfect credenza for your new home. But before we can start decorating, we need to talk about buying a home first.
We understand buying a home, submitting an offer, and navigating the whole home-buying process can be overwhelming, whether you’re a first-time or seasoned homebuyer – but don’t worry, we’re here to help. In this Redfin article, we’ll be covering everything you need to know about a lowball offer, so there’s one less piece of jargon to be confused about.
Table of Contents
What is a lowball offer?
A lowball offer is when a buyer makes an offer on a house that is significantly below the asking price. Typically, this offer is 10-30% below the asking price, but this depends on several factors like market conditions, the market value, the home’s condition, and how long the home’s been on the market. For instance, in a seller’s market where demand is high and inventory is low, an offer with a small discount may seem like a lowball offer.
Pros of a lowball offer
For the homebuyer, the biggest pro is that they could buy a home for well below the market price, saving them a decent amount of money.
For the seller, a lowball offer can signal interest, which can be encouraging in a slow market or create a sense of buzz, which may attract other buyers. For sellers under pressure to sell, this kind of offer may be beneficial for a quicker close since it’s better than no sale or waiting longer.
For both parties, even if the buyer doesn’t accept the lowball offer, just offering can start the negotiation process, so both can agree upon a price.
Cons of a lowball offer
For the homebuyer, there are, unfortunately, several cons to making a lowball offer. You may offend the seller and damage your credibility with this kind of offer, which could lead them to refuse to negotiate,…