How to Make an Offer on a House
Buying a home is one of the most exciting—and sometimes nerve-wracking—milestones in life. Once you’ve found a house that checks all your boxes, the next step is making an offer. This process can feel daunting, especially if you’re a first-time homebuyer, but with the right approach, you can craft a compelling offer that stands out to the seller. Here’s a step-by-step guide to help you navigate the process with confidence.
1. Do Your Homework
Before you even think about putting pen to paper, research is key. Start by understanding the local real estate market. Are you in a buyer’s market (more homes than buyers) or a seller’s market (high demand, low inventory)? Look at comparable sales—known as “comps”—in the area to get a sense of what similar homes have sold for recently. Websites like Zillow, Redfin, or working with a real estate agent can provide this data.
Also, consider the house itself. How long has it been on the market? A home sitting for weeks might signal the seller is more open to negotiation, while a hot new listing could spark a bidding war. Knowing these details helps you gauge how aggressive or flexible your offer can be.
2. Get Pre-Approved for a Mortgage
Sellers want assurance that you can actually buy their home. A mortgage pre-approval letter from a lender shows you’re serious and financially capable. It also helps you determine your budget, so you don’t waste time chasing a house you can’t afford. In competitive markets, pre-approval can give you an edge over other buyers who haven’t taken this step.
3. Decide on Your Offer Price
Your offer price is the heart of the deal, and it should reflect both the home’s value and your budget. Start with the comps you researched, then factor in the home’s condition, any repairs needed, and market trends. If the house is priced fairly and in high demand, you might offer at or above asking price. If it’s overpriced or needs work, a lower offer could make sense—just be ready to justify it.
Work with your real estate agent to strike the right balance. They can provide insight into what’s worked for other buyers in the area and help you avoid overpaying or lowballing so much that your offer gets ignored.
4. Consider Contingencies
Contingencies are conditions that must be met for the sale to go through. Common ones include:
Financing contingency: Protects you if your mortgage falls through.
Inspection contingency: Lets you back out or renegotiate if major issues are found.
Appraisal contingency: Ensures the home’s value matches the loan amount.
In a hot market, some buyers waive contingencies to make their offer more appealing, but this comes with risks. Discuss with your agent what’s standard in your area and how much risk you’re comfortable taking.
5. Write the Offer Letter
Your offer isn’t just a number—it’s a formal proposal. Typically, your real estate agent will draft the purchase offer, which includes:
The offer price.
Your down payment amount.
Contingencies (if any).
Proposed closing date.
Any concessions you’re requesting (e.g., seller pays closing costs).
An expiration date for your offer (usually 24-48 hours).
You might also include a personal letter to the seller, especially if the home has sentimental value to them. Share why you love the house and how you envision your life there—it can tug at their heartstrings and set you apart.
6. Submit and Negotiate
Once your offer is ready, your agent submits it to the seller’s agent. Then, the waiting game begins. The seller might accept your offer as-is, reject it, or counter with different terms. If they counter, you can accept, decline, or counter back. This back-and-forth can take a few rounds, so stay patient and flexible—but know your limits.
7. Seal the Deal
If your offer is accepted, congratulations! You’ll sign a purchase agreement, and the process moves to escrow. This is when your contingencies (like the inspection or appraisal) come into play. Your agent and lender will guide you through these steps, ensuring everything aligns before closing day.
Tips for Success
Act quickly: In competitive markets, hesitation can cost you the house.
Stay within budget: Don’t let emotions push you into a financial stretch.
Lean on your agent: Their expertise is invaluable for strategy and negotiation.
Be respectful: A polite, professional approach can win over sellers.
Making an offer on a house is part art, part science. By researching the market, preparing financially, and crafting a thoughtful proposal, you’ll boost your chances of landing your dream home. Take a deep breath, trust the process, and soon enough, you could be turning the key to your new front door. Happy house hunting!