How to Negotiate the Price on a House

A man and a woman negotiating the price on a house.

Written byShawnna Stiver|June 17, 2025

Negotiating the price of a house can feel like stepping into uncharted territory, especially for first-time homebuyers. But here’s the good news: with the right strategies and preparation, this process doesn’t have to be stressful or intimidating. Think of it as an opportunity to secure a home that fits your dreams AND your budget.

This guide will take you step-by-step through the house negotiation process. Whether you’re securing your first home or upgrading to a new one, these actionable tips will help you master the art of negotiation.

Understand the market

Before making any offers, gain a clear understanding of the real estate market you’re dealing with. Are you in a buyer’s market or a seller’s market? This distinction impacts your leverage in the negotiation process. For example:

A buyer’s market gives you the advantage. Home inventory outweighs demand, so sellers are more likely to accept negotiations or incentives to close the deal.
A seller’s market, however, means more competition. Fewer homes and a surplus of interested buyers give sellers the upper hand, leaving less room for negotiation.

Do your homework

Thorough research on the home and local neighborhood can provide negotiation insights. Here’s how to dig deeper:

Local comparables: Review recent sales of similar properties. Were they sold at, below, or above asking price?
Seller’s motivation: Why is the seller moving? Sellers eager to make a deal (e.g., due to job relocation) might be more flexible on price.
Days on market: Homes sitting unsold for longer periods may signal more negotiation potential.

Know your budget

Negotiation begins with a clear understanding of your financial parameters. How much are you willing and able to spend? What’s your upper limit? Without this clarity, negotiating can lead to costly decisions or overspending.

Get pre-approved for a mortgage: A mortgage pre-approval gives you a clear idea of what lenders are willing to loan you, plus it shows sellers that you’re serious and credible as a buyer.
Account for extras: Remember that the sale price isn’t everything. Consider down payments, closing costs, and ongoing expenses related to owning the property (like taxes and maintenance).
Set your limits: Decide in advance how much wiggle-room you have but under no circumstances exceed your maximum budget.

Key negotiation tip: Avoid making the first offer without a sale price listed. When the seller sets the starting point, it gives you insights into their expectations and provides room for response and counteroffers.

Be prepared to walk away

There’s no easy way to say this, but sometimes walking away is the smartest move. While it’s normal to feel emotionally attached to a potential home, don’t lose sight of the bigger picture. Paying more than you’re comfortable with or ignoring red flags can create financial stress down the line.

If you’re trying to assess whether it’s time to walk away, ask yourself these questions:

Is the seller unwilling to meet your price range?
Are there major issues uncovered in the home inspection?
Does your budget align with this purchase, given other priorities or future plans?

Remember, there are always more homes on the market. A better deal is likely waiting just around the corner.

Key negotiation tip: Mistakes are valuable learning experiences. Use them to refine your approach during future negotiations. Always have a backup plan in case your current deal falls through.

Control your emotions

Negotiating can invoke all kinds of feelings — excitement, anxiety, frustration. Allowing emotions to guide your decisions, however, can hinder the negotiation process.

Take time to think: Avoid responding impulsively to an offer. Review the terms carefully and consult your agent or trusted advisors before making decisions.
Focus on facts: Stick to discussing numbers, comparables, and property specifics.
Keep a poker face: Show interest in the property, but avoid appearing too eager. Sellers may leverage perceived desperation to their advantage.

Key negotiation tip: Be direct. If there’s something you want, communicate it clearly during negotiations. Transparency speeds up the process and helps achieve mutually beneficial agreements.

Consult your agent

An experienced real estate agent is invaluable during negotiations. They’re not just there to show you properties; they are your advocate, your strategist, and your voice of reason when negotiating price.

Here are a few of the main areas a real estate agent’s skills will come in handy:

Market expertise: Agents understand local market trends, pricing, and what influences a seller’s decision.
Negotiation skills: They know how to structure offers that secure the best terms without alienating the seller.
Objective advice: Agents can separate emotional decisions from logical ones, ensuring your best interests come first.

Key negotiation tip: Make sure your real estate agent is aware of all your wants and needs in a home. That way when they're advocating for you, they can make the strongest case toward what is going to make you most happy while winning over the seller.

Leverage contingencies

Real estate contingencies offer the flexibility to negotiate while protecting your purchase. These clauses outline specific conditions that must be met for the sale to proceed, such as inspection results or appraisals.

Include these common contingencies in your offer letter to help negotiate your must-haves:

Home inspection contingency: Protect yourself by including an inspection contingency to ensure the property has no expensive hidden flaws.
Appraisal contingency: If you’re financing the home purchase, most lenders will require a home appraisal. Having an appraisal contingency protects you from overpaying by tying the purchase price to the home’s fair market value.
Financing contingency: If your loan doesn’t get approved, a financing contingency allows you to back out of the transaction without penalty.

Key negotiation tip: Carefully review contingencies with your agent to decide which to include and when it’s appropriate to waive them.

Consider incentives

Sometimes meeting halfway isn’t about the purchase price but the extras you can negotiate for with the seller. Closing costs, repairs, or even the closing date itself can be bargaining chips in creating a deal that benefits both parties.

Examples of seller incentives

Closing costs: Ask the seller to pay for closing costs or roll some fees into the agreement.
Buyer credits for repairs: If there are issues with the home, the seller may offer credits instead of completing the repairs themselves.
Flexible closing date: Accommodate the seller’s preferences to make your offer more appealing.

Key negotiation tip: Make sure to discuss who will cover closing costs during negotiations. Offering to pay slightly more for the home in exchange for seller concessions can often create a win-win situation.

Empower your home-buying journey

Negotiating the price of a house might seem daunting, but with the right preparation and mindset, it becomes a manageable — even empowering — experience. By understanding the market, knowing your budget, consulting experts, and controlling emotions, you can set yourself up for success.

Looking for expert guidance on finding your dream home? Our Zillow partner agents are ready to help! Connect with local market experts who can guide you through every stage of the process.