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How to Make an Offer on a House: Step-by-Step Guide for Beginners (2026)

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How to Make an Offer on a House: Step-by-Step Guide for Beginners (2026)

You found it. After weeks of searching, touring dozens of homes, and dismissing properties that didn't quite fit—you finally found the one.

Now comes the part that makes your palms sweat: making an offer.

For first-time buyers, this moment is equal parts exciting and terrifying. You're about to commit hundreds of thousands of dollars to the biggest purchase of your life, and you have no idea if you're doing it right.

Should you offer asking price? Below? Above? What about contingencies? Earnest money? How long do you have to decide? What if they reject it? What if they accept and you panic?

This guide walks you through the entire offer process step-by-step, from the moment you decide "this is the one" to the moment you get a response from the seller. This is a critical step in your first-time home buying journey, and getting it right can save you tens of thousands of dollars.

Let's make you an offer they can't refuse (or at least one that's competitive and protects your interests).

Your Complete Offer Strategy Resource Hub

Making a winning offer requires understanding multiple components. Here's your roadmap:

Before You Make Your Offer

Determine what to offer - Don't guess on price. Our complete guide on how much to offer shows you how to use market data to determine the right offer price for any property.

Decide on asking price - Wondering if you should pay full price? Learn when to offer asking price and when to go below based on market conditions and property data.

Calculate fair market value - Master the art of calculating fair market value using comparable sales, adjustments, and market analysis.

Structuring Your Offer Terms

Earnest money strategy - Learn how much earnest money to offer to show you're serious without risking too much.

Competitive situations - In multiple offer scenarios, understand how escalation clauses work and when to use them strategically.

Run your own analysis - Discover why smart buyers run their own offer analysis even with a great agent, and how it gives you negotiating leverage.

Ready for Competition?

Once you master the basics here, move on to our Complete Guide to Winning Bidding Wars for advanced strategies in competitive markets.

Before You Make an Offer: Essential Prerequisites

Step 0: Get Pre-Approved (Not Pre-Qualified)

You cannot make a serious offer without a pre-approval letter. Period.

Pre-qualified: "Based on what you told us, you might be able to borrow $400k." (Worthless)

Pre-approved: "We've verified your income, credit, and assets. We will lend you $385,000 at 6.5% for 30 years." (Required)

Why sellers care:

In competitive markets, sellers won't even look at offers without pre-approval. It shows:

  • You're a serious buyer
  • You can actually get financing
  • The deal is likely to close

What you need for pre-approval:

  • Last 2 years tax returns
  • Last 2 months pay stubs
  • Last 2 months bank statements
  • Photo ID
  • Credit check authorization

Timeline: 2-3 days if you have documents ready

Do this before you start house hunting, not after you find a house you love.

Know Your True Budget

Your lender will approve you for the maximum they think you can technically afford. But that's often more than you should actually spend.

The bank's job: Lend as much as possible without you defaulting

Your job: Borrow only what keeps you comfortable

Use the 28/36 rule:

  • Housing costs (mortgage, taxes, insurance) should be max 28% of gross income
  • Total debt payments should be max 36% of gross income

Example:

You make $8,000/month gross.

  • 28% = $2,240 max housing payment
  • This includes: mortgage + property taxes + insurance + HOA

If property taxes are $400/month and insurance is $150/month, your mortgage payment should be max $1,690/month.

At 6.5% interest for 30 years, that's roughly a $270,000 loan.

With 10% down, you can afford around a $300,000 house.

Don't stretch beyond this just because the bank says you can.

Do Your Market Research

Before making any offer, you need to know:

What is this house actually worth?

Not what the seller is asking. Not what you're willing to pay emotionally. What the market data says.

How to find out:

  1. Look at comparable sales (comps)

    • Similar homes (size, age, condition, location)
    • Sold in last 3-6 months
    • Within 1 mile (closer is better)

  2. Check current listings

    • What are similar homes listed for?
    • How long have they been on market?
    • Any recent price reductions?

  3. Understand market conditions

    • Seller's market (low inventory, multiple offers)?
    • Buyer's market (high inventory, homes sitting)?
    • Balanced market?

  4. Use data tools

    • Zillow, Redfin, Realtor.com for recent sales
    • offer.guide for AI-powered analysis
    • Your agent's MLS access

Never make an offer without doing this research first.

Step 1: Decide Your Offer Price

This is the most important decision. Get it wrong and you either:

  • Lose the house to a higher offer
  • Overpay by tens of thousands
  • Insult the seller and kill negotiations

Our complete guide on how much to offer on a house provides detailed strategies, but here are the key factors:

Factors to consider:

Comparable Sales

What have similar homes actually sold for (not listed for)?

Example:

  • 3 bed/2 bath, 1,800 sq ft homes in this neighborhood
  • Sold in last 90 days for: $465k, $472k, $468k
  • Average: $468k

Your target home is similar condition → Fair value is around $465k-470k.

Learn the complete process of calculating fair market value to determine what any property is truly worth.

List Price vs. Market Value

Scenario 1: Listed at market value

House listed at $470k, comps support $465k-475k.

Strategy: Offer $460k-465k and negotiate up if needed.

Scenario 2: Listed below market (rare)

House listed at $450k, comps show $475k-485k.

Strategy: This will get multiple offers. Consider offering at or slightly above asking to compete.

Read our guide on when to offer asking price to understand these scenarios better.

Scenario 3: Listed above market

House listed at $495k, comps show $465k-475k.

Strategy: Offer what it's worth ($465k-470k), not what they're asking. Let them come back to reality.

Market Competition

Hot market / Multiple offers expected:

  • Offer at or above asking
  • Include escalation clause
  • Minimize contingencies
  • Be prepared to move fast

Normal market:

  • Offer 3-5% below asking as starting point
  • Standard contingencies
  • Room to negotiate

Buyer's market:

  • Offer 5-10% below asking
  • Keep all contingencies
  • Take your time

Property Condition

Move-in ready / Updated:

  • Pay closer to asking price
  • Less room to negotiate

Needs work:

  • Estimate repair costs
  • Subtract from fair market value
  • Offer accordingly

Example:

  • Fair value: $380k
  • Needs new roof: -$12k
  • Needs HVAC: -$8k
  • Dated kitchen: -$5k
  • Your offer: $355k

Days on Market (DOM)

0-14 days: Hot property, offer competitively

15-30 days: Normal, some room to negotiate

31-60 days: Sitting longer, offer below asking

60+ days: Significant negotiating power, start low

Seller Motivation

Ask your agent to find out:

  • Why are they selling?
  • Do they have a timeline?
  • Have they bought their next home?
  • Any other offers?

Motivated sellers (job relocation, divorce, foreclosure) → More negotiating power

Patient sellers (no rush, testing market) → Less negotiating power

Your Strategy

Three common approaches:

Conservative:

  • Offer 3-7% below asking
  • Expect counteroffer
  • Negotiate up if needed
  • Risk: Might lose to higher offer

Market Value:

  • Offer what comps indicate
  • Fair to both parties
  • Good starting point
  • Most common strategy

Aggressive:

  • Offer at or above asking
  • Win competitive situations
  • Pay for certainty
  • Risk: Might overpay

Your offer price should be:

  1. Based on data (comps)
  2. Adjusted for condition and market
  3. Within your budget
  4. Something you can defend rationally

If you can't explain WHY you're offering $X, you're guessing.

Calculate your offer price with data →

Step 2: Structure Your Offer Terms

Price is only part of the offer. Terms matter just as much.

Earnest Money Deposit

What it is: Good faith deposit showing you're serious

How much:

  • Standard: 1-2% of purchase price
  • Competitive: 3-5%

Example:

  • $400k house
  • 2% earnest money = $8,000

When you pay it: Within 24-48 hours of accepted offer

What happens to it:

  • Deal closes → Applied to down payment
  • You back out with valid contingency → Refunded
  • You back out without valid reason → Seller keeps it

Strategy: In multiple offers, higher earnest money shows commitment.

For complete details on how much earnest money to offer and why it matters, including protection strategies, see our full guide.

Down Payment

How much you're putting down upfront

Common amounts:

  • 20%: Best rates, no PMI, strongest offer
  • 10-15%: Acceptable, need PMI
  • 5%: Minimum for conventional
  • 3.5%: FHA minimum
  • 0%: VA or USDA loans only

Example:

  • $400k house
  • 20% down = $80,000 cash
  • Loan = $320,000

Strategy: Larger down payment makes offer stronger (shows financial stability).

Contingencies

Conditions that let you back out without penalty

Essential contingencies:

1. Financing Contingency

  • Can back out if you can't get a loan
  • NEVER waive this unless paying cash
  • Standard: 21-30 days

2. Inspection Contingency

  • Can back out if inspection reveals major issues
  • Or negotiate repairs/credits
  • Standard: 7-10 days
  • Risk if waived: You're stuck with any problems

3. Appraisal Contingency

  • Can back out if home appraises below offer price
  • Protects you from overpaying
  • Standard: included in financing contingency
  • Risk if waived: Must cover gap in cash

Optional contingencies:

4. Home Sale Contingency

  • Can back out if you can't sell current home
  • Makes your offer much weaker
  • Avoid if possible

5. Title Contingency

  • Can back out if title issues found
  • Usually standard, keep it

If you're confused by terms like contingencies, earnest money, or appraisal, check our Real Estate & Mortgage Terms Glossary for clear definitions.

Contingency strategy in competitive markets:

Keep:

  • Financing contingency (always)
  • Inspection contingency (if possible)

Consider waiving:

  • Appraisal contingency (if you have cash reserves)
  • Home sale contingency (sell first or get bridge loan)

Never waive without understanding the risk.

Closing Timeline

When do you want to close?

Standard: 30-45 days

Fast: 21 days (need strong financing lined up)

Slow: 60 days (seller needs time)

Strategy: Match the seller's preferred timeline if possible. Flexibility wins offers.

Additional Terms to Consider

Rent-back to seller

  • Let seller stay after closing and pay you rent
  • Solves their timing problem
  • Makes your offer more attractive
  • Example: "Seller can rent back for 30 days at $150/day"

Include/exclude items

  • Appliances staying or going?
  • Window treatments?
  • Outdoor furniture, shed, play set?
  • Clarify everything to avoid disputes

Closing cost credits

  • Ask seller to contribute to your closing costs
  • Example: "Seller to pay $5,000 toward buyer's closing costs"
  • Reduces your upfront cash needed

Appraisal gap coverage

  • Promise to cover X dollars over appraisal
  • Example: "Buyer will pay up to $15,000 over appraised value"
  • Very strong signal in competitive markets

Step 3: Write and Submit the Offer

Your Agent Does the Heavy Lifting

Your real estate agent will:

  1. Draft the purchase agreement
  2. Include all terms you've discussed
  3. Attach your pre-approval letter
  4. Submit to seller's agent
  5. Follow up

You don't write the offer yourself. Your agent uses standard forms and knows the legal requirements.

What's Included in a Purchase Agreement

The official offer document includes:

1. Purchase price

2. Earnest money amount

3. Down payment amount and financing terms

4. Contingencies with deadlines

  • Inspection: 10 days from acceptance
  • Financing: 21 days from acceptance
  • Appraisal: 21 days from acceptance

5. Closing date

6. Property address and legal description

7. Included/excluded items

8. Seller disclosures acknowledgment

9. Buyer and seller information

10. Signatures

Required Attachments

1. Pre-approval letter from lender

2. Earnest money check or wire info

3. Proof of down payment funds (sometimes)

  • Recent bank statements
  • Gift letter if funds are from family

4. Personal letter to seller (optional)

  • Can help in competitive situations
  • Keep it brief and genuine
  • No protected class information

Submission Timing

How long do you have to submit an offer?

There's no universal rule, but:

Hot market / Multiple offers expected:

  • Submit within 24-48 hours of seeing the property
  • Seller might set deadline ("highest and best by Tuesday 5pm")
  • First strong offer often wins

Normal market:

  • Take 2-5 days to think it through
  • Do your research
  • Don't rush, but don't wait too long

Buyer's market:

  • Take your time
  • Property will likely still be there
  • Do thorough due diligence

General rule: Once you decide you want the house, move quickly. Hesitation can cost you the home.

Step 4: Wait for Response (The Hardest Part)

Seller Has Three Options

Option 1: Accept

They sign the agreement as-is. Congratulations, you're under contract!

What happens next:

  • Executed contract sent to you
  • You wire earnest money within 24-48 hours
  • Clock starts on contingency periods
  • Inspection scheduled
  • Lender begins underwriting

Option 2: Reject

They decline your offer outright. Rare, but happens if:

  • Your offer is insultingly low
  • They already accepted another offer
  • They decided not to sell

What happens next:

  • You move on to the next house
  • Or you can try again with better terms (if they're open to it)

Option 3: Counteroffer (Most Common)

They respond with different terms.

Common counteroffers:

Higher price:

  • You offered $385k
  • They counter at $395k

Different contingencies:

  • You included home sale contingency
  • They counter: "Remove home sale contingency"

Different timeline:

  • You proposed 45-day close
  • They counter: "30-day close required"

Seller credits:

  • You asked for $5k closing cost credit
  • They counter: "$2,500 credit"

How Long Until You Hear Back?

Typical response time:

  • 24-48 hours in normal markets
  • 12-24 hours in hot markets
  • Sometimes same day

If you don't hear back:

  • Your agent follows up with listing agent
  • Be patient but proactive
  • Radio silence beyond 48 hours is unusual

Multiple Offers Scenario

If seller receives multiple offers, they'll usually:

  1. Review all offers
  2. Request "highest and best" from top candidates
  3. Choose one (or counter with multiple buyers, rare)

What is "highest and best"?

Seller says: "We have multiple offers. Submit your best and final offer by 5pm tomorrow."

This is your one shot. Decide:

  • Can you increase price?
  • Can you improve terms?
  • Is this your maximum?

If you're not willing to go higher, stick with original offer. Don't get into a bidding war you can't win.

For complete strategies on competing in multiple offer situations, see our guide to winning bidding wars.

Step 5: Negotiate the Counteroffer

Don't Panic, Counteroffers Are Normal

A counteroffer doesn't mean they hate your offer. It means they're interested but want better terms.

This is negotiation. It's expected.

How to Respond to a Counteroffer

You have three options:

Option 1: Accept the counteroffer

If their terms are acceptable, sign and move forward.

Example:

  • You offered $385k
  • They countered $395k
  • That's within your budget
  • You accept

Done. You're under contract.

Option 2: Reject the counteroffer

If their terms are unreasonable or outside your budget, walk away.

Example:

  • You offered $385k
  • They countered $425k
  • That's $40k more and way over your max
  • You reject and move on

Option 3: Counter the counteroffer (most common)

You respond with terms somewhere in the middle.

Example:

  • You offered $385k
  • They countered $395k
  • You counter at $390k
  • They accept

This can go back and forth 2-3 times. Eventually someone accepts or you reach an impasse.

Negotiation Strategies

Strategy 1: Meet in the middle

Classic compromise.

  • You: $385k
  • Them: $400k
  • Middle: $392,500

Strategy 2: Give on price, get on terms

  • Them: $400k with 45-day close
  • You: "$400k, but 30-day close and $3k closing cost credit"

Strategy 3: Stand firm

  • Them: $400k
  • You: "I appreciate the counter, but $385k is my maximum based on comps. If that works, I'm ready to move forward. If not, I understand."

Sometimes firmness works. Sometimes you lose the house.

What to Negotiate

Don't just focus on price. Negotiate the whole package:

Price (obviously)

Closing date (flexibility is valuable)

Contingencies (which ones, how long)

Included items (appliances, fixtures)

Repairs (if inspection already done)

Closing cost credits (seller contribution)

Rent-back (if seller needs time)

Sometimes giving on one thing gets you another.

Example: "I'll go to $395k (your number) if you include the washer/dryer and cover $4k of my closing costs."

Net result: You're getting $5k+ in value back, making $395k effectively $390k.

When to Walk Away

Walk away if:

Your budget is exceeded

If you're negotiating beyond your comfortable maximum, stop.

Seller is unreasonable

If they're playing games, constantly changing terms, or not negotiating in good faith, walk.

You discover red flags

If something about the property or seller concerns you, trust your gut.

Another house interests you more

If you've found something better while negotiating this one, pivot.

You're no longer confident

Cold feet are real. If you're not excited about this house at these terms, don't buy it.

Step 6: Offer Accepted - Now What?

You're Under Contract (But Don't Celebrate Yet)

Under contract means:

  • Seller accepted your offer
  • Both parties signed
  • Earnest money will be deposited
  • Contingency clocks are ticking

It does NOT mean:

  • You own the house
  • The deal will definitely close
  • You can't back out

You still have contingency periods to complete due diligence.

Immediate Next Steps

Within 24-48 hours:

  1. Wire earnest money to escrow

    • Your agent gives you instructions
    • Use wire transfer, not check
    • Verify wire instructions by phone (wire fraud is real)

  2. Get homeowners insurance quotes

    • Required by lender
    • Shop around for best rate
    • Need coverage by closing

  3. Schedule home inspection

    • ASAP (usually within 7-10 days)
    • Cost: $300-600
    • Takes 2-4 hours
    • You should attend

  4. Lender begins underwriting

    • They'll request more documents
    • Verify employment
    • Order appraisal
    • Don't make any major financial changes

During the Contingency Period

Inspection contingency (7-10 days):

  • Get home inspected
  • Review inspection report
  • Decide: proceed as-is, request repairs, or back out
  • Negotiate if needed

Financing contingency (21-30 days):

  • Lender processes your loan
  • Underwriting completed
  • Appraisal ordered
  • Loan approved (or denied)

During this time:

  • Don't quit your job
  • Don't buy a car
  • Don't open new credit cards
  • Don't make large purchases
  • Don't transfer money around

Anything that changes your financial picture can kill your loan approval.

If Inspection Reveals Issues

Minor issues (normal wear and tear):

  • Accept and move forward
  • Budget for repairs after closing

Moderate issues ($2k-10k repairs):

  • Request seller credit at closing
  • Or ask seller to make specific repairs
  • Or renegotiate price

Major issues (foundation, structural, $20k+):

  • Renegotiate significantly
  • Back out using inspection contingency
  • Proceed only if you're comfortable

If Appraisal Comes In Low

See our complete guide on handling low appraisals

Quick version:

  • Negotiate with seller to lower price
  • Pay the gap in cash
  • Challenge the appraisal
  • Walk away using appraisal contingency

Common Mistakes When Making Offers

Mistake 1: Offering Without Pre-Approval

Don't do it. Sellers won't take you seriously, and you might not even qualify for what you're offering.

Mistake 2: Letting Emotions Override Data

"I love this house, I'll pay anything!"

Bad idea. Love the house, but offer based on data.

Understand why smart buyers run their own analysis to avoid emotional overpaying.

Mistake 3: Offering Asking Price Without Research

Just because they're asking $450k doesn't mean it's worth $450k.

Research first. Offer based on comps. Learn when to offer asking price and when to go below.

Mistake 4: Waiving Contingencies You Need

Don't waive inspection to win unless:

  • You've done pre-inspection
  • House is brand new
  • You have significant cash reserves for repairs

Mistake 5: Making a Lowball Offer in a Hot Market

Offering $350k on a $400k house with 5 other offers? You just wasted everyone's time and insulted the seller.

Read the room. Offer competitively when appropriate.

Mistake 6: Including Too Many Demands

"I'll offer $385k if you replace the roof, repaint everything, include all appliances, pay my closing costs, and give me a 60-day rent-back."

Pick your battles. Don't overload the offer with demands.

Mistake 7: Waiting Too Long

"Let me think about it for a week."

Someone else will offer in the next 24 hours.

Decide quickly or lose the house.

Mistake 8: Not Having Maximum Price Decided

If you don't know your walk-away price before negotiations start, you'll overpay in the moment.

Decide your max before making an offer.

Mistake 9: Negotiating Directly with Seller

Let your agent handle it. Direct buyer-to-seller negotiation gets emotional and messy.

Mistake 10: Giving Up After One Rejection

If your offer gets rejected or countered unfavorably, you can:

  • Try again with better terms
  • Come back in a few weeks if house is still available
  • Find out what they really want

Don't assume one rejection means game over.

Sample Offer Scenarios

Scenario 1: First-Time Buyer, Competitive Market

Property: $425,000 list price, 6 offers expected

Buyer situation:

  • Pre-approved for $450k
  • 10% down saved ($45k)
  • First-time buyer
  • Loves the house

Offer strategy:

  • Price: $435,000 (2.4% over asking)
  • Earnest money: 3% ($13,050)
  • Down payment: 10%
  • Contingencies: Financing and inspection only (waive appraisal, will cover $10k gap if needed)
  • Close: 30 days (seller's preference)
  • Include: Personal letter

Result: Accepted. Seller liked the clean offer, higher price, and commitment (appraisal gap coverage).

Learn more about escalation clauses for competitive situations.

Scenario 2: Budget-Conscious Buyer, Normal Market

Property: $380,000 list price, been on market 35 days

Buyer situation:

  • Pre-approved for $400k
  • 15% down saved
  • Not in a rush
  • House needs minor updates

Offer strategy:

  • Price: $360,000 (5.3% below asking)
  • Earnest money: 2% ($7,200)
  • Down payment: 15%
  • Contingencies: All standard (financing, inspection, appraisal)
  • Close: Flexible, seller's choice
  • Request: $3,000 closing cost credit

Result: Seller countered at $370k with $1,500 credit. Buyer accepted. Closed at $370k with $1,500 credit.

Scenario 3: Cash Buyer, Investment Property

Property: $275,000 list price, needs work, been on market 60+ days

Buyer situation:

  • Paying cash
  • Experienced investor
  • Will renovate and rent
  • Property needs $30k in updates

Offer strategy:

  • Price: $240,000 (12.7% below asking)
  • Earnest money: 5% ($12,000 - shows serious cash buyer)
  • All cash, no financing contingency
  • Inspection for information only
  • Close: 14 days (fast)
  • As-is purchase

Result: Seller countered at $255k. Buyer countered at $248k. Seller accepted $250k. Closed in 12 days.

The Bottom Line: Be Strategic, Not Emotional

Making an offer is both art and science.

The science: Data, comps, market analysis, budgets

The art: Reading the seller, timing, negotiation, intuition

The best offers combine both:

  • Based on solid research
  • Structured strategically
  • Presented professionally
  • Negotiated intelligently

Before you make any offer, ask yourself:

  1. Do I know what this house is actually worth?
  2. Is my offer based on data or emotion?
  3. Can I comfortably afford this price?
  4. Do I understand the risks I'm taking?
  5. Am I protected by appropriate contingencies?
  6. What's my walk-away price?

If you can answer all six confidently, you're ready to make an offer.

If not, do more homework first.

Make Data-Driven Offers with Confidence

The difference between a good offer and a bad one often comes down to one thing: knowing what the house is actually worth before you make your offer.

Don't guess. Use data.

Analyze Your Property with offer.guide →

Get your personalized offer strategy in 5 minutes:

  • Fair market value based on real comparable sales
  • Two offer strategies (conservative vs. competitive)
  • Risk assessment for over/under offering
  • Monthly payment projections
  • Walk-away price to protect yourself

Your first analysis is free. No credit card required.

Because making an offer is stressful enough. At least make it with confidence that your numbers are right.

Related Articles

Getting Started:

Making Offers:

Competitive Situations:

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