The Term Counteroffer Explained

The Term Counteroffer Explained

Picture this:

You’re getting ready to buy a home. You’ve got all of your ducks in a row. You’re prequalified. You hired a Realtor®. You’ve done your research on neighborhoods. You’ve discussed the terms of the offer in advance and you’ve brainstormed ways to get your offer accepted. We all know you have to be prepared to act fast in this market.  Then, BOOM the perfect house hits the MLS. Your agent schedules the showing. You implement your plan and your offer is submitted to the seller.

The seller and listing agent likely receive multiple offers. They’ve reviewed them all and perhaps they pick yours! However, instead of simply accepting your offer they make what is known as a counteroffer. Um, what?

Counteroffers are a fairly common occurrence in the real estate market. You may assume you have done all of the research and made an offer they can’t refuse but that’s why we don’t make assumptions.

Truthfully, you need to be prepared for a counteroffer. Everyone has different ideas of what the perfect deal may be, so you’ve got to do a little bit of negotiating to get to the common goal.

Let’s say that the home you want to purchase is on the market for $250,000.
Your offer is:
$250,000 + washer/dryer & refrigerator + closing in 45 days
(This does not reflect a formal offer, rather just to give you an idea of the contents)
The seller comes in with a counteroffer of:
$255,000 + no washer/dryer + yes refrigerator + closing in 30 days
$245,000 + no washer/dryer or refrigerator + closing in 60 days

The counteroffer you receive does not mean it’s the end of the deal, but perhaps just the beginning. The sole fact that the sellers are making you a counteroffer is (typically) a good sign, and as long as both parties can come to an agreement, you’ll be on track to buying a home!

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