Ask a Wahi REALTOR®: What Negotiation Tactics Work Best When Faced With a Seller’s Counteroffer?

Don’t dread real estate negotiations — come to the bargaining table prepared with the following tips for homebuyers facing a seller’s counteroffer.

By Josh Sherman | 2 minute read

When submitting an offer on a home for sale, it’s common for the seller to counter with one of their own.

Often, buyers and sellers don’t totally see eye to eye on any number of items included in the initial offer. A few issues in particular tend to be common stumbling blocks towards an accepted offer. “It could be the price that they disagree about, it could be the closing date, or it could be certain conditions that the seller is not happy with that they want removed from the offer,” explains Wahi Broker of Record Anne Alkok.

When this occurs, the seller will typically draft a counter offer and send it back to the buyer for consideration. “At that point you have a choice. You can either accept the offer, or you can counter it again,” says Alkok.

If you’ve put in an offer on the home, chances are you are at least motivated to consider the counter offer. In this case, Alkok has some tips for what negotiation tactics work best when faced with a seller’s counteroffer. 

1. Start early. 

You don’t wait for a counter offer. With your realtor, try to confirm what’s important to the seller right off the bat so that you can draft your initial offer accordingly. “It minimizes the amount of back-and-forth in the negotiations if you already know what some of the key elements that should be in that offer are,” Alkok explains. “Then there will be fewer things that need to be changed — and possibly you’ll be in a position to accept the counter offer.”

2. Put everything in writing.

Negotiation may be all about clear communication, but when it comes to counteroffers (and responses to them), put down in writing everything that’s been discussed. “A lot of people think you can just negotiate orally,” says Alkok. “But nothing in real estate binding unless it’s written. It has to be a document, in writing,” she emphasizes.

3. Negotiate for today’s market.  

Market conditions play a part in negotiations. In a seller’s market, the seller has more of an edge and may be more likely to insist the buyer forgo certain conditions, such as the deal being contingent upon a home inspection. In a buyer’s market, you may be able to negotiate more concessions from the seller. Keep the current market dynamics in mind when responding to a counteroffer. If you’re a homebuyer in the Greater Toronto Area, Wahi’s Market Pulse tool can help you gauge how competitive the market is down to the neighbourhood level. Wahi listings also recently got smarter with built-in market data, including the average days on market for the area, as well as the median sold price and more.

4. Don’t compromise outside your comfort level.

The terms of your response to a counteroffer — and whether you continue negotiations at all — boils down to your level of comfort with what’s in the contract. From the start, identify what you are comfortable compromising on — and what you are not. Unless your situation suddenly changes materially (say you had an unexpected windfall that boosts your budget), don’t succumb to pressure to agree to any contract items that you’ve established are outside of your comfort zone.