Start with the likely market value.
Homebuyers often review recent comparable sales in the local area, adjusting for size, location, property type and condition. Automated valuation tools can be useful references, but rarely show every repair need or property-specific issue.
Account for repairs and transaction risks.
A buyer may need to budget for roof, mechanical, foundation or cosmetic issues, as well as the time, permits and costs involved in making the house market-ready. A vacant house, rental situation, title issue or slow resale market can add risk.
Estimate carrying and closing expenses.
Taxes, insurance, utilities, financing or capital costs, title and closing costs, and potential selling costs can reduce what a buyer can afford to pay.
Leave a margin for the buyer.
Professional buyers generally need a potential return for taking ownership and risk. This is why offers can fall below retail market price. The difference isn't necessarily an undisclosed fee, but you should request a clear explanation of your own offer's terms.
Example: the logic, not an actual appraisal.
Illustration only: Suppose a home's expected resale value is $300,000. A buyer might budget $35,000 for repairs, $20,000 for resale and holding costs, plus a margin for risk and profit. An offer would reflect those assumptions and property-specific details. The numbers are hypothetical and are not a promise or valuation of your property.
What should you ask for?
- The actual price in writing, and any price-adjustment contingencies.
- Who pays title, transfer, attorney and other closing costs.
- Who the buyer will be and whether assignment is permitted.
- Your estimated net proceeds after liens and other deductions.
- The closing timeline and what could delay or cancel it.
It's reasonable to get another offer or consult a real estate professional before accepting. A trustworthy buyer should welcome informed questions.