How to Deal With Lowball Offers From Buyers
You will receive lowball offers on nearly every deal. Some are from inexperienced buyers testing the waters. Some are from sophisticated buyers trying to get a steal. And some are from buyers whose analysis genuinely differs from yours. How you respond determines whether the lowball becomes a deal or a dead end.
Evaluating the lowball
Before responding emotionally, ask: why is this offer low? Possible reasons: the buyer has different (possibly more accurate) comps, the buyer estimates higher repairs than you, the buyer has a lower risk tolerance and wants more margin, or the buyer is simply testing your floor.
When to counter
Counter when: the offer is within 10-15% of your asking price, the buyer has verified proof of funds, the buyer is responsive and engaged (not just blasting offers on every deal), and you believe there is room for both parties to reach agreement.
When to hold firm
Hold firm when: your pricing is supported by solid comps, you have other interested buyers, the lowball is more than 20% below asking with no justification, or accepting the offer would result in a trivial or negative assignment fee.
Response to a lowball
"Thanks for the offer. I appreciate your interest in the property. Based on recent comparable sales at [addresses and prices] and the estimated repairs of [amount], the deal supports my asking price of [price]. I'd like to work with you on this — is there specific data that is driving your lower offer? I'm happy to share my full comp analysis."
The walk-away counter
Sometimes the best counter is a polite rejection with an open door: "I can't accept [lowball amount], but I understand where you're coming from. If the deal doesn't move in the next few days, I may be able to revisit. In the meantime, I'll keep you posted."
Related guides
- Handling Buyer Objections
- Negotiating With End Buyers
- Pricing Your Assignment Fee
- Managing Multiple Offers
- Re-Marketing Stale Deals