When A Seller Counters Way Over Asking
A reader sent me a story that is frustrating but not rare. A home was listed at $650,000. The buyer made a full price offer on day one. By the end of the weekend there were 3 offers. The seller provided a counter offer to all three buyers at $850,000. That is $200,000 higher than the list price. The buyer was stunned and asked why a seller would do that.
Where This Behavior Comes From
During the frenzy from 2020 through 2022 many sellers priced slightly below market to spark a bidding war. Rock bottom rates and pandemic moves poured gasoline on demand. It was common to see homes sell far over list. I saw properties jump $100,000 to several hundred thousand over asking. In a few cases the gap was even larger.
Some sellers are still trying to replay that script. They set an attractive list price to lure traffic and hope competition will drag offers into the stratosphere. The problem is the market has cooled in many areas. Buyers are pickier. Payments are higher. Appraisals matter again. The old playbook does not always work.
What Likely Happened Here
My read is simple. The seller listed at a number they never intended to accept. They expected the crowd to push price to their real target around $850,000. When the offers did not reach that level they decided to counter offer all buyers at the wish price anyway. That move tends to backfire. Buyers feel played and walk. Momentum dies. Days on market rise. The home can end up selling for less than it would have with a realistic list.
Lessons For Buyers
- Treat a low list price as a marketing number not a promise.
- Before you bid, ask your agent to pull a tight set of comps to estimate true value.
- Decide your walkaway number in advance and stick to it.
- If a seller gives you a counter offer far above the comps you can counter back with data or move on. There will be another house.
Lessons For Sellers
- Price to the market you have today, not the market you remember.
- A well supported list price attracts serious buyers and reduces appraisal drama.
- The best offer is often the most reliable one, not always the highest. Shorter timelines, strong finances, and fewer contingencies can be worth real money.
- Greed creates churn. Gratitude and clarity create closings.
A Word On Agent Advice
Sometimes sellers receive poor guidance. Other times they hear good guidance and ignore it. Make sure your agent grounds recommendations in current comps, absorption rates, recent price reductions, and appraisal feedback. Ask them to show their work. Align on a pricing strategy and a decision plan before the first showing.
Bottom Line
This was a waste of time for everyone. Buyers felt misled. The listing lost momentum. The seller will likely need to reset expectations and strategy. If you are a buyer and run into this, let it go and keep looking. If you are a seller, remember that we are still in a good market compared with the very hard years many of us lived through. Choose ease and certainty over spectacle.
Need Help
If you want a second set of eyes on pricing or strategy, send me a note. I am happy to review comps, pressure test your plan, and connect you with a vetted real estate agent in your area who will help you reach the finish line with less drama.
