In the world of real estate, buyers usually make a formal offer on a property they wish to buy. The offer may be the sellers’ listed asking price for the property, or whatever their Realtor would suggest is the fair market value.
Typically the buyers’ realtor puts the buyers’ offer in writing and then forwards it to the seller’s agent. The seller can later accept the offer from the seller, in which case they will start closing the sale of the property. If the seller does not accept the offer, they can make a counter offer as part of the negotiations on the property’s price. This process could be an up and down negotiation between the buyers’ realtor and sellers’ realtor until a common ground is reached.
Before making an offer on a house or property, a buyer should consider the following: How many days has the property been on the market? How much have similar properties sold for in the area? What is the physical condition of the property in question, and does it need any repairs or renovations?
If the property has been on the market for a long period of time, requires repairs or is above similar properties pricing, there may be room for negotiation. This could potentially save buyers quite a bit of money, depending on the temperament of the local real estate market. If the local market is cold, a low offer has a higher chance of being accepted. On the other hand, in hot conditions, buyers should be prepared to make offers above the asking price in order to secure the property.