Negotiate Like a Pro: The Ultimate Guide to FSBO Counteroffers

Negotiate Like a Pro: The Ultimate Guide to FSBO Counteroffers

March 11, 2025

Congratulations! You found your dream home! But, you soon discover it’s a FSBO (for-sale-by-owner), which means the seller is handling negotiations without an agent. In the real estate world, FSBO is affectionately known as “fizz-bow.” About 7% of sellers choose the FSBO route, so it’s not uncommon.

If you’re working with an agent, they’ll help you navigate the process. If not, you’ll be negotiating directly with the seller.

Here’s how it typically plays out:

1. You or your agent make an offer.

2. The seller responds with a counter-offer.

3. You review the counter-offer, but it’s not quite what you’re looking for.

This is where countering the counter-offer comes in. It’s your chance to negotiate the terms that matter most to you.

“The struggle is the negotiating part,”

explains Grand Rapids-based agent Justin Glover. But, without an agent on the other side, things can get tricky. So, how do you successfully negotiate and land your dream home?

When negotiating with a FSBO seller, it’s crucial to understand that the sale price is often the most important factor to them. Since FSBO sellers don’t have an agent, they might not have done their due diligence on pricing, relying instead on:

1. Online valuations

2. Advice from friends

3. Personal expectations

As a buyer, it’s essential to:

1. Research the market value

2. Know the home’s worth

3. Use that number in your negotiations

Additionally, FSBO sellers might intentionally price their home below market value to avoid paying agent commissions. Keep this in mind when making your offer.

“To determine the sale price, a lot of for-sale-by-owners will look at some online valuation,” says Glover Home Group’s Jay Glover. “Or they’ll have a friend who says, ‘Hey, you should list for this’ — or maybe they just had a number in mind that they need to hit to make it worth their while to sell.”

Closing costs are another negotiable aspect of a home purchase. Typically, buyers ask sellers to cover part of these costs. Revisiting the terms of closing costs can be a strategic move, especially in a buyer’s market where you may have more leverage.

In a buyer’s market, you may be able to negotiate more concessions on closing costs. Even in a seller’s market, offering to make concessions on closing costs can help keep your mortgage payments manageable while still providing an incentive for the seller in a counter-offer.

The timing of a purchase contract can be crucial, especially if the seller needs extra time to move out. If negotiations are taking longer than expected, the original closing date might become unrealistic for the seller. Consider showing flexibility with the closing date to gain an advantage. If the seller is under time pressure, offering a rent-back provision could be a winning strategy. This allows the seller to stay in the home for weeks or months after closing, giving them the time they need. By accommodating the seller’s needs, you can strengthen your position in the negotiation.

Jay Glover explains:

“If it’s a family who’s moving across the country for a job and they need more time to get moved out, maybe you can say, ‘Hey, we’ll give them a little less money, but let’s give them 45 days after close instead’ and ensure that they’re going to have time to get moved.”

Consider the following contingencies when negotiating

Inspection contingencies:

If the inspection reveals needed repairs or updates, you can waive these contingencies or offer to cover the costs. This can help keep your mortgage payments lower while showing flexibility to the seller.

Appraisal contingencies:

If the appraisal value is lower than your offer, you can agree to pay the difference up to a certain point. Keep in mind that this means conceding on the price, which may impact your monthly payments.

Sales contingencies:

If the seller is buying a new home contingent on selling their current one, you may have room to negotiate. The seller is likely motivated to sell quickly, so understanding their situation can help you find a mutually beneficial agreement.

Earnest Money

One effective way to get the seller’s attention is to speak their language: money. Consider offering more earnest money to demonstrate your commitment and get the purchase process moving forward.

Will the Seller Counter Above the Asking Price?

It’s possible, especially in a seller’s market or if you made a full-price initial offer. If the seller listed the house at a discounted price, they may also counter with a higher number.

However, in a buyer’s market or balanced market with more inventory than buyer interest, this scenario is less likely.

The appraisal amount also plays a crucial role. If the seller counters with a higher number, the home must appraise for at least that amount for the buyer to secure the loan.

Countering the Counter-Offer

1. Gather necessary documents, including recent comparable sold homes (comps) that are similar in size, amenities, and location.

2. Write the counter-offer, ensuring compliance with state guidelines.

Consult with an agent or attorney if needed.

By being prepared and informed, you can navigate the counter-offer process and achieve your goal of purchasing your new home.

How to Leverage your Earnest Money

To expedite the closing process, consider submitting your earnest money check, typically in the form of a cashier’s check, to the title company in advance. This way, it’s already on file while you’re negotiating, saving valuable time later on.

If the transaction isn’t working out, you can withdraw your counter-counter offer as long as it hasn’t been formally accepted with a signed agreement. Keep in mind that the seller also has the right to withdraw from the transaction, especially if they have multiple offers. They can choose the most beneficial offer, as long as they haven’t put anything in writing.

Buying a house can be complex, and FSBO transactions can be particularly challenging when it comes to negotiations. However, by following our guide and being prepared, you’ll be well-equipped to navigate the process smoothly and achieve your goal of owning your dream home.

Negotiate Like a Pro: The Ultimate Guide to FSBO Counteroffers

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