Should You Offer Over Asking Price On A Home?

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Apr 12, 2023

The home buying process is a game where sellers look to get the most from their home and buyers seek to pay as little as possible to purchase the property.

Homes are typically priced slightly higher than the fair market value, though there are times when the asking price is lower than the property’s true worth.

It is logical to think that your offer should be at or below what the seller is asking, but it may make sense to make an offer that is more than the listed price.

The market dictates the home’s fair value, but only you can decide what it is worth to you and your family.

To offset a seller’s market, compete in a bidding war, bid against all-cash buyers, or if you simply cannot stand the thought of losing the dream home you have been searching for, it may be necessary to put in an offer that is over asking price on a home.

When Should You Offer Over Asking Price?

When submitting an offer for a home that is over the asking price, this may be the best move to make sure you get the house you want. Offering over the asking price is a strategic move that can be used to increase the chances of getting the home and not losing out from other offers.

The following are examples of circumstances when it makes sense to present an offer for a home that is above the stated asking price.

Seller’s Market

A seller’s market occurs when there are more buyers than sellers, and the demand for homes for sale is greater than the supply available. In this situation, you will see increased competition that will force you to up your offer if you want to have a chance at buying the home. Sales prices can rise by 10 percent or more when it is a seller’s market.

Homes in a seller’s market sell quickly and often at higher prices than their assessed value. By evaluating and comparing what homes in the neighborhood are selling for, you and your realtor can determine the course of action for your specific circumstances.

Bidding War

When a bidding war breaks out for a home you covet, you will need to decide whether you want to jump into the fray or look at other houses.

Find out before you make an offer whether there are other offers on the table either through your broker or by asking the seller directly. Sellers may list their home below the fair market value to spark a bidding war. If a home is blatantly underpriced to get potential buyers to bid against each other, you will either need to act fast or get out of any negotiations.

Competing with Cash Offers

Sellers love all-cash offers. Paying in cash removes any uncertainty associated with financing. The seller knows the buyer has the money to close the deal and makes the process easier and quicker. If you are financing and going up against all-cash bids, you will have to sweeten the offer to get noticed.

All-cash offers have a distinct edge over potential buyers who will need a mortgage to purchase the home. If you know you are competing against an all-cash offer, putting in a higher bid over the asking price may be the only chance you have to have the seller accept your offer.

Seller is Unmotivated to Sell

Some homeowners are not nearly as urgent as others to sell and will list their homes simply to test the market and see what they could get if they sold. Your lender can contact the listing agent to understand their motivation. Making an offer that is above the listed price may get a passive seller excited and make them more motivated to complete the sale.

You Love the Home

The purpose of doing an exhaustive search before buying a house is to find your dream home. If you find a home that checks all of your boxes and seems perfect for your needs and preferences, you can put in an offer that will be hard for the seller to refuse. You need to decide how badly you want the home and how much over the asking price you are willing to pay to make sure you get it. Letting your emotions dictate financial decisions can also be risky, so it is essential to make sure you find out all you can about the house before even making an offer.

Long-Distance Purchase

If you are moving to a new area for career or personal reasons, you may not have the time or availability to tour and place bids on multiple listings. When you find a home you like, it may be worth it to make your offer slightly over the asking price to help increase the chances your bid will be accepted and avoid prolonging the process.

How Do You Avoid Overpaying for a Home?

As badly as you may want a certain home, getting into a bidding war or making an offer above the asking price could wind up being a regrettable mistake.

It is important to consult with your realtor and other industry professionals to make sure you are putting in a bid that is in your best financial interests.

Only you can decide if an offer or a deal is right for you, but you need to have all of the information and understand all the potential consequences before getting locked into a long-term commitment.

Work With A SimpleShowing Agent & Get $5,000 on average Towards Closing Costs

Making an offer on a home can be a stressful, confusing experience. You want to make sure the offer is substantial enough to be accepted without overpaying for the home.

At SimpleShowing, our team of talented real estate agents can help you navigate through the process of putting in a bid for a home and help you make the best decisions for your situation. Our agents do 3x more deals than the average agents, so we’re skilled in negotiating the best deals.

To make things even better, all clients who purchase a home with SimpleShowing qualify for our closing cost credit of $5,000 on average. If you’re offering over asking price, this can help reduce the out of pocket expenses for you when you close on your new home!

Contact SimpleShowing for complete information or book a showing to get started today!


In the competitive housing market, offering over the asking price can be a viable strategy to secure your dream home, but it should always be guided by sound advice from your trusted real estate agent and careful consideration of your home buying budget. Your agent’s knowledge of the market conditions, experience with multiple bids, and understanding of your unique financial situation can help you navigate whether going above the list price will serve your best interests. It’s essential to note that a higher offer may increase your monthly mortgage payment and could potentially require a larger down payment, depending on your mortgage lender’s terms.

Keep in mind that while paying over the listing price may increase the chances of acceptance, it also has potential drawbacks such as possibly facing an appraisal gap if the property does not appraise at your offered price. To mitigate such risks, having an appraisal contingency in place can be beneficial. Furthermore, it may also impact the earnest money deposit you’ll need to secure the home. In a buyer’s market, a significant over-asking offer may not be necessary, but in a competitive market, offering a few thousand dollars over the list price might make the difference.

To conclude, the decision to offer over the asking price on a home is not one-size-fits-all. It depends largely on the current market conditions, the buyer’s financial situation, the specifics of the mortgage loan, and the advice of your real estate agent. Remember, home buying is a significant investment, and every step, including deciding on your offer, should align with your financial goals and comfort level.

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