How Much Should You Offer on a Home? Finding Your Regret-Free Number
The Lighter Side of Real Estate • January 28, 2025
For many buyers, deciding what to offer on a home is one of the most nerve-wracking parts of the process. Buyers often find themselves wondering whether they should offer more or less than the asking price.
On one hand, buyers have always wanted to snag a home at the best possible price. Who wouldn’t love the satisfaction of getting a deal? On the other hand, in recent years, many buyers have grown accustomed to bidding wars and offering above asking price just to secure a property. It’s a tricky dance between those two instincts—saving money and winning the house—and it leaves many wondering: How much should I really offer?
Whichever camp you’re in, it’d be nice to have some cut and dry guidance on when you can come in lower, when you have to offer more than asking, and even some insight into how much above or below asking you should come in with your offer.
For instance, while this recent Realtor.com article about whether to offer below or above asking price might sound promising, unfortunately it isn’t the hard and fast answer you may be looking for. The advice basically boils down to:
- If it’s a buyer’s market or the house has been on the market a long time, you can offer less than the asking price.
- If it’s a seller’s market or a brand new listing, you’ll probably need to offer more than the asking price.
- Either way, there’s no absolute answer to what you should do because it depends upon a lot of factors.
- Ask your agent for help figuring out what to offer given your specific market, and the house you’re about to make an offer on.
All of that is true, but it doesn’t really provide the answer you may be looking for. That’s because there is no absolute answer.
While you should certainly listen to your agent’s insight and advice, it’s ultimately your decision how much to offer for a house. That’s why the best strategy is to find your “regret-free” number—the price that leaves you confident no matter what the outcome.
What Is a Regret-Free Number?
Your regret-free number is the amount you’re comfortable with in every possible scenario. It’s a price you won’t second-guess if the seller rejects your offer, and one you won’t regret if the seller accepts it. Achieving this balance requires careful thought and preparation.
Think of it this way: If the seller rejects your offer, will you wish you had offered more? If so, you haven’t hit your number yet. On the other hand, if the seller accepts your offer, will you feel uneasy about paying too much? That’s a sign you’ve gone too high. Your regret-free number sits in that sweet spot where you can confidently move forward, regardless of the seller’s response.
Tips for Determining Your Regret-Free Number
It’s easy to get swept up in the excitement (or frenzy) when you find a house you want to buy. Emotions can easily override logic, especially if you find yourself in a bidding war. But whether there is stiff competition or not, the amount you are willing to pay for the house should be determined by you, not by how many other buyers are making offers, or how much the seller wants.
Whether your final offer is above or below asking, determining your regret-free number for any particular house takes preparation, research, and a clear understanding of your financial limits. Here are some steps to guide you:
- Study the Market: Work with your agent to review comparable sales in the area. These comps give you an idea of what similar homes have sold for recently, helping you assess whether the asking price is fair. While many buyers wait until they are about to make an offer to review “comps” (and some never do!), you should begin reviewing sales data with your agent early on in your home search to get a feel for market values. This will help you make a much more informed decision than other buyers who are just reviewing sales data as they’re about to make an offer.
- Consider How Long You Plan to Stay In the Home. If this is your forever home, you might be willing to stretch your budget slightly for the perfect fit. However, if you think you’ll move again in a few years, it’s wise to stay within a more conservative range to ensure you don’t overpay relative to market trends.
- Know Your Limits: A mortgage pre-approval may say that you can technically afford the payments, but only you can determine if you can do so comfortably each month. Calculate how much you can comfortably afford, not just in terms of the purchase price but also monthly payments, closing costs, and future expenses.
Deciding how much to offer on a home doesn’t have to be overwhelming. By focusing on your regret-free number—the amount you can commit to without second-guessing—you can approach the process with clarity and confidence. Do your homework, rely on your agent’s expertise, and stay grounded in both your financial and emotional priorities. At the end of the day, the right number isn’t just one that secures the house—it’s one that leaves you feeling at peace with your decision.
Partner with an agent who truly understands the local market. From the earliest stages of your search, they can educate you on property values and market trends, giving you the knowledge you need to make informed decisions. By preparing ahead of time, you’ll be able to approach offers with confidence—whether it means going above, below, or right at the asking price. The more you know upfront, the easier it becomes to navigate the process and find your regret-free number.
The Takeaway:
Deciding how much to offer on a home can feel daunting, but it doesn’t have to be. By understanding the market, doing your research, and setting a regret-free number, you can approach the process with confidence. Work closely with your agent, stay focused on your priorities, and remember that the goal isn’t to get the “perfect” deal—it’s to find a home you love at a price you’re comfortable with. When you do that, you’ll know you made the right decision.
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Every year, on the third Saturday of July, millions of people celebrate National Toss Away the “Could Haves” and “Should Haves” Day. OK… maybe not millions. But somebody probably does! While it’s not exactly the kind of holiday most people mark on their calendars, it’s built around an idea that’s surprisingly relatable. We all have moments we wish we could do over. Maybe you could have invested in a company before its stock took off. Maybe you should have kept that classic car instead of selling it years ago. Maybe you could have taken that job, started that business, or simply made a different decision somewhere along the way. Real estate has no shortage of “could haves” and “should haves,” either. In fact, one that’s been floating around quite a bit lately sounds something like this: “Maybe I should have sold my house a few years ago.” “Maybe I’ll just wait until the market gets better…” If you’ve been paying attention to the housing market lately, you may have noticed that some homeowners are putting their houses up for sale… and then deciding to take them back off the market. According to recent data , delistings have been on the rise as more sellers decide they’d rather wait than accept a market that isn’t quite living up to their expectations. In fact, they’re delisting at the highest rate since 2020, right around the time the pandemic began. When you think about it, it’s not hard to understand why. For several years, many sellers got used to homes selling almost immediately, multiple offers arriving within days, buyers waiving contingencies, and offers coming in above asking price. But, as real estate markets tend to do, they’ve changed in many areas. Depending on where you live, and the price range your home is in, buyers may have more choices than they’ve had in years. They may take longer to make a decision. They’re more likely to ask for inspections, repairs, seller concessions, or simply negotiate harder than they would have a few years ago. For some homeowners, that shift is frustrating enough to make them think… “Maybe I’ll just wait until the market gets better.” And for some people, that may absolutely be the right decision. Two Thoughts That Are Closer Than They Appear What’s interesting is that the two thoughts we’ve been talking about are actually pretty close cousins. “Maybe I should have sold my house a few years ago.” “Maybe I’ll just wait until the market gets better.” One is based on wishing you could go back and capitalize on yesterday’s market. The other is based on hoping you’ll recognize the right time to capitalize on tomorrow’s. They’re both completely understandable. In fact, they’re probably thoughts just about everyone has had at one point or another—not just in real estate, but in life. The catch is that neither one is particularly helpful when you’re trying to decide what to do today. After all, you can’t sell your house three years ago. And no one—not even the smartest economists—knows exactly what the housing market is going to look like three years from now. Or any other number of years for that matter. You can only make decisions based on what the market is currently doing. The Problem With Using Extraordinary as Your Baseline It’s also worth remembering that today’s market isn’t necessarily a bad market for sellers. In many parts of the country, home prices are still historically strong. In fact, if you ask many buyers how they feel about today’s market, there’s a good chance they’ll tell you homes are still too expensive and affordability remains one of their biggest challenges. What’s changed isn’t necessarily that sellers have lost all of their leverage. It’s that many of them have lost the extraordinary leverage they enjoyed just a few years ago. But now your home may take a little longer to sell. You might not have quite as many showings. Your buyer may ask for repairs or seller concessions that would have been laughed off during the frenzy of the pandemic market. None of those things necessarily mean it’s a bad time to sell. They may simply mean the market has become a little more… normal. And normal can feel disappointing when you’re comparing it to one of the strongest seller’s markets in modern history. Every Market Creates a Few “Should Haves” One of the interesting things about real estate is that every market eventually becomes the one somebody wishes they’d taken advantage of. Looking back, it’s easy to find a market where you wish you had bought, sold, or invested. The challenge, of course, is that nobody knows which market people will be saying that about until years later. Will some homeowners who decide to wait ultimately be glad they did? Absolutely. Every seller’s situation is different, and for some, waiting may prove to be exactly the right decision. But chances are, this market will also become one that at least some homeowners eventually look back on and say, “I probably should have sold then.” The only problem is that none of us knows which market that will be until we’re looking at it in the rearview mirror. That’s why “could haves” and “should haves” usually aren’t the best guide when making real estate decisions. They only show up after the fact. If you’re debating whether to sell now, wait a while, or even relist a home you recently took off the market, one of the smartest things you can do is have a conversation with a knowledgeable real estate agent. They can help you evaluate your local market, your personal situation, and your long-term goals so your decision is based on today’s realities—not yesterday’s regrets or tomorrow’s unknowns. And if nothing else, perhaps National Toss Away the “Could Haves” and “Should Haves” Day is a good reminder that yesterday’s market is gone, tomorrow’s market hasn’t arrived, and today’s market is the only one any of us actually gets to make decisions in.
Big Investors Are Backing Off and That’s Your Opening For years, a lot of would-be homebuyers have worried about the same thing. How do you compete with big investors who can swoop in, pay cash, and snap up the houses you want? Well, worry a little less. Because right now, those big investors aren't buying up the market. They're backing out of it. Investors Are Buying Fewer Homes Than They Have in Years According to Redfin, investor home purchases just fell to their lowest level since 2020 – when the start of the pandemic temporarily caused pretty much all homebuying to pull way back. Before that, you'd have to go all the way back to 2016 to find a time when investors bought this few homes (see graph below): Why the step back? Two big reasons. First, Washington passed a housing law that takes aim at large institutional investors. To be clear, these mega investors were never as big a part of the market as the headlines made it sound. They’ve always made up a relatively small slice of housing pie. But the law still targeted the largest ones, and it worked fast. According to Thom Malone, Principal Economist at Cotality: “When Washington announced its intention to curb institutional investors’ homebuying, the market reacted. . . Cotality data shows that investment by mega investors who own 1,000 or more properties retracted almost instantly. ” Second, the housing market has cooled. Price growth has slowed in much of the country, and in some markets, prices are dipping. That makes the math a lot less appealing for investors betting on quick gains. Lance Lambert, CEO of ResiClub, explains : “Ever since rates spiked and the Pandemic Housing Boom fizzled out in spring 2022, institutional single-family rental (SFR) operators have pulled way back from buying up homes on the resale market—the math just isn't as appealing right now. Home prices and rents are no longer ripping, holding costs (property taxes and insurance) have jumped, capital markets have shifted their attention elsewhere, and elevated materials prices make renovations expensive.” They’re Not Just Buying Less – They’re Selling More This is the part most people miss. Big investors aren't just slowing down their purchases. Data from Parcl Labs and ResiClub shows the largest institutional investors are now selling more homes than they're buying – and that gap is growing these past 4 quarters (see graph below): Every one of those homes goes right back into the market for buyers like you. And since big investors tend to own homes at the lower end of the price range, a lot of what they're selling is exactly the kind of home first-time buyers are looking for. As Malone puts it : ". . . this sudden dropoff in institutional investment is a signal to first-time homebuyers that there's an opening." Less competition from deep-pocketed buyers. More homes hitting the market. And many of them at prices that work for a first purchase . That's a shift that works in your favor. Bottom Line Big investors are stepping back, and they're adding homes to the market as they go. If you've been waiting for a better shot at buying, this could be it. Let’s connect so you can see what's popping up in our area. You may have more options than you think.
Home Price Growth Slowed Down. That May Be Changing. After more than a year of headlines talking about how home prices are going to crash , the latest data shows that price growth may be starting to pick back up again. And depending on whether you’re buying or selling, that shift means something different for you. The Numbers May Be Starting To Turn For the past couple of years, home price growth has been moderating – cooling from around 7% in mid-2024, according to Redfin (see graph below). But look at the right side of that graph. The pace of that growth appears to have hit its low point and started to turn. While a couple months of data doesn’t necessarily mean this will be a lasting trend, there are some other signs that this could continue. For example, fewer markets are seeing prices decline. According to ResiClub and Zillow, about 36% of the 300 largest housing markets had falling prices as of the middle of last year. Since the start of this year, that share has been shrinking. Now? Only 23% are experiencing those mild dips (see graph below): When fewer markets see prices falling, that means more markets are seeing prices rise again. And forecasts suggest this shift has room to run. On average, experts project home prices will rise about 2.3% nationally this year. And for that to happen, price growth would have to pick up a bit in the second half of 2026. But Remember, Real Estate Is Local While it looks like national prices may be starting to pick back up a tiny bit, that doesn’t mean that’s what’s happening in your neighborhood. National home prices are really just an average of hundreds of local markets. Some are climbing faster. Others are still cooling. But one reason the national average may be looking up is because a growing number of metros may actually be net positive for prices this year. Not long ago, the major metros were split about 50/50 – half seeing prices rise and half seeing them fall. Now, that balance looks like it’s starting to tip in a more positive direction. Just last month, more than half of the major metros saw prices go up, according to Redfin (see graph below): As Selma Hepp, Chief Economist at Cotality, explains : “. . . local markets continue to tell very different stories. Annual home price growth has changed little since the start of the year, but some markets, especially those supported by strong job and income growth in the West and more affordable Midwest markets, have seen notable acceleration in price gains.” What This Means for You Home price headlines can be confusing because they don’t always tell the full picture. Lean on an agent to understand what’s happening in your local market and what the early signs say for where prices may go from here. That’s the best way to stay one step ahead of the market. If you're buying: slower price growth has worked in your favor. You've had more room to negotiate and a budget you could plan around. If price growth is picking up in your area, buying now may mean paying less than you would later this year. If you own a home: you've been gaining equity all along, even while growth moderated. If growth keeps picking up, those gains could speed up, too. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), projects the typical homeowner will gain roughly $16,000 in housing wealth this year. And if you're thinking about selling, this shift is a good early sign for you. Just remember, the market is still pretty balanced and buyer-friendly in a lot of areas right now. Home price growth slowed way down, and now it's showing early signs of picking back up. Whether you're buying or selling, let's connect so you can see exactly what prices are doing in our local market and what that means for your plans. Bottom Line Home price growth slowed way down, and now it's showing early signs of picking back up. Whether you're buying or selling, let's connect so you can see exactly what prices are doing in our local market and what that means for your plans.
