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Real Estate Counteroffers: A Buyer’s Guide

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Buying a home is hardly ever a simple real estate transaction. The process can be intimidating and sometimes involves lengthy negotiations before a buyer and seller reach an agreement. The path to an agreement is often paved with offers and counteroffers. 

As a buyer, you get to make the first offer. But you must be prepared if the seller makes a counteroffer. We’re here to help ease any anxiety about making an offer, responding to counteroffers and using them as part of your strategy to get the house you want. 

What Is a Counteroffer?

In real estate, a counteroffer is an offer in response to an offer already on the table.

A seller, in collaboration with their real estate agent, will set a listing price for their home. They may not even expect to sell the property for the listed price. It could be a marketing tactic to draw interest and encourage offers.

When you make a purchase offer on a home, the seller can accept the offer, reject it or make a counteroffer that jump-starts negotiations. The seller’s counteroffer rejects and voids your original offer but opens the door to negotiations. 

How Do You Counteroffer on a House?

During a home sale, the offer and counteroffer process usually involves distinct steps:

  1. The seller sets the asking price.
  2. The prospective buyer makes an initial offer that includes a purchase price and any contingencies (aka conditions to purchase the home). 
  3. The seller can accept or reject the buyer’s offer or make a counteroffer. The counteroffer will likely be a figure between the asking price and the buyer’s offer. The seller may also accept or reject the buyer’s contingencies in the counteroffer. 
  4. The buyer can accept or reject the counteroffer or make a new counteroffer.
  5. This back-and-forth will continue until both parties agree or the buyer or seller rejects the last counteroffer. (In the case of the seller, they may decide to go with a better offer from another buyer.) 

Have your agent review or draw up your counteroffer(s). And make sure they always have an expiration date. In case you’re wondering, verbal offers aren’t legally binding. Anything you discuss with a seller or listing agent doesn’t matter until it’s written down.

You should also know that a seller can ignore your counteroffer if they aren’t interested in what you’re offering or asking. In that situation, you can make another offer or walk away. However, a seller will usually respond unless they have multiple offers or feel you haven’t made a credible offer.

What is typically negotiated in a counteroffer?

Most counteroffers center on the price of the home. However, there are other factors a counteroffer can address, including:

Earnest money

Earnest money is a signal to the seller that a buyer really wants to buy their home. If the buyer makes a bigger deposit at the seller’s request, that reinforces to the seller that the buyer is serious about closing the deal. 

Closing costs

A buyer may counter and ask the seller to pay a portion of the closing costs. By the way, this request is more likely to succeed in a buyer’s market.

Closing date

If a buyer or seller needs more time to close or wants to close sooner, they can add a closing date to the counteroffer.


A buyer’s offer usually contains contingencies, like a professional home inspection or appraisal. Sometimes – typically in a seller’s market – a buyer will decrease the number of contingencies to increase the seller’s interest in their counteroffer. 

Tips for Buyers To Negotiate Counteroffers

  • Use your real estate agent to gather intel on the seller: If you know the seller wants to sell while the real estate market is hot but isn’t ready to move, that’s an opportunity to negotiate. Maybe you can get the house for a lower price if you agree to let the seller rent the house back from you.
  • Make your counteroffer stand out by increasing the earnest money deposit: An earnest money deposit usually equals 1% – 3% of a home’s purchase price. A larger-than-average deposit will likely increase a seller’s confidence in your determination to buy their home. 
  • Ask for repairs that are important to you: Buyers can request repairs in their counteroffers, like fixing a crack in the pool or securing a wobbly toilet. 
  • Request concessions: Seller concessions are specific costs sellers can cover, including appraisal and inspection fees.
  • Use data to support your offer: Your agent should have data on the sale price of comparable homes in the area. Use the information to support your offer. 
  • Make an open-ended offer: This can be a successful tactic in highly competitive markets. For example, let’s say the seller lists the home for $500,000 and receives several offers at and over the asking price. You may want to offer $515,000 with a stipulation that you will beat the best offer received within 3 days, up to $525,000. 

Common counteroffer mistakes buyers should avoid

  • Countering with a lowball offer: If the seller is sticking to their asking price or expects higher offers because it’s a seller’s market, it doesn’t make much sense to counter with a lower offer unless you are sweetening the deal some other way.
  • Making a larger counter than you can afford: Don’t get caught up in the spirit of competition and offer more than you can pay for the home. If you have a home buying budget (and you should, by the way), don’t blow past your max purchase price to beat your fellow bidders. You may not qualify for a mortgage at that price or end up overpaying for the home. 
  • Disregarding the appraisal value of the property: This advice cuts both ways. Don’t overbid on a home that won’t appraise for as much as you are offering. And don’t stubbornly underbid and expect your offer to be accepted. 
  • Asking for repairs without support for the cost of the repair: If you are countering with a repair request or asking to lower the purchase price because you plan on covering the repair, make sure you have an estimate for the cost of the repair. If you ask for too much, it may seem like a backhanded effort to decrease the sales price. 

When Should You Accept a Seller’s Counteroffer?

There is no right or wrong answer to when you should accept a counteroffer. Remember, buyers and sellers have different interests and goals. Typically, the seller wants to sell their home for as much as possible, and the buyer wants to buy the house for the lowest price they can negotiate. 

The buyer and the seller likely have a professional guiding them to achieve their respective goals. If your agent believes you are getting the best deal for a home and the price fits your budget, it’s probably wise to follow your agent’s advice. 

When should a buyer walk away from a real estate negotiation?

If you have fallen in love with a home – or you’re tired of being outbid – we can understand the temptation to quickly agree to a seller’s demands. 

But if the home’s price is higher than you are comfortable paying or you feel like the seller is rushing you, follow your instincts and negotiate until you’re satisfied or walk away. 

Frequently Asked Questions

What is a reasonable counteroffer on a house?

The counteroffer will depend on several factors, including the home’s original asking price, contingencies and whether it’s a buyer’s market or seller’s market. The goal of negotiating is to narrow the gap between the seller and buyer so they meet somewhere in the middle.

How many counteroffers should I expect? 

If the primary concern is the purchase price, counteroffers may end after one or two rounds. If there is contention around occupancy dates or inspection results, the process might go on for several rounds.

Can I withdraw my counteroffer? 

Unless a purchase agreement has been signed, a buyer or seller can withdraw and end negotiations at any time. Note that once the purchase agreement is signed, the only way to legally terminate the purchase is through the failure of the buyer or seller to fulfill any contingency clauses, a problem with the title, or if one of the parties doesn’t fulfill another aspect of the contract.

Can sellers receive multiple counteroffers at the same time?

It makes sense for a seller to consider multiple buyers – at least initially. The seller may let potential buyers know there are multiple offers in the mix and suggest each buyer make their best offer. Using this strategy, a seller might receive higher offers or lose a few buyers.

If at First You Don’t Succeed …

You know the rest: try, try again. Buying a house can be challenging. And if the thought of negotiating fills you with dread, it can feel even more challenging. But the back-and-forth between offers and counteroffers plays an important role in the purchase process. 

During negotiations, the buyer can identify what’s important to the seller and vice versa. Understanding what’s important to the seller should help you hone in on areas of agreement.

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The Short Version

  • When you make a purchase offer on a home, the seller can accept the offer, reject it or make a counteroffer that jump-starts negotiations
  • With most offers and counteroffers, the buyer or seller must respond within 48 hours
  • The counteroffer will depend on several factors, including the home’s original asking price, contingencies and whether it’s a buyer’s market or seller’s market
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