Why the percentage rule does not exist
"Offer 5% under" assumes every home is listed at the same relationship to its value. They are not. Some homes are priced under market deliberately to generate competition. Some are priced at market by an agent who did the work. Some are priced 15% over because the seller insisted.
Offering 5% under on the first is an insult that loses you the house. Offering 5% under on the third is still overpaying by a wide margin. The number is meaningless without the context.
What actually determines your room
- How the list price relates to comparable sales. The only real anchor. Everything else is secondary.
- Days on market, read properly. Two weeks in a busy segment means something different from two weeks in a quiet one. A home relisted at a new number resets the visible count but not the history.
- Competition right now. How many similar homes are available to the same buyer, and how many buyers are looking.
- Seller motivation. An empty home, a possession date already committed, a previous collapsed deal, or a listing that has been through two price reductions all tell you something.
- Condition findings. A defect with a real number attached is the most defensible basis for a lower offer, because it is arithmetic rather than opinion.
Price is not the only lever
In a competitive situation the winning offer is frequently not the highest. Possession date flexibility, a cleaner condition structure, a larger deposit, or simply being straightforward to deal with can all carry weight — particularly with a seller who has already had one deal collapse.
Conversely, stripping every condition to win is how buyers end up owning problems they never inspected. There is a version of a competitive offer that is still sensible, and it is worth constructing deliberately.