Let's say you've found a house you really like in Harrisonburg... listed at $495K.

We've checked the comparable sales and have concluded that the house is worth $490K to $495K... but you're hoping to buy it for closer to $485K, if possible.

So you offer... $420K.  (!?!)

The seller sees that number and doesn't respond. No a counteroffer... no response at all... your super low offer likely offended them.

You come back at $475K. Still nothing.

You try $485K. Still nothing.

Now -- because you really love the house -- you find yourself offering the full list price, $495K, to make sure you can buy the house after all.

I probably made this example extreme enough that you can anticipate what I am going to suggest next.

Might you have been able to negotiate down to $485K if you had started with a more reasonable offer?  Probably so.

The problem with an extremely low opening offer...

When a seller lists their home at $495K and genuinely believes it's worth that, an offer of $420K doesn't feel like a reasonable offer, or a serious buyer -- if often feels like an insult to the seller.  That can often shut down the conversation, and any potential negotiations, very quickly.  

Starting closer to market value opens is a better strategy...

If we had started at $480K or even $475K, the negotiations almost certainly would have looked very different. The seller counters at $493K. You come back at $483K. You land at $485K or $487K. You are pleased with your purchase price and the seller is reasonably pleased with their sale price.

So... if you're getting ready to make a below list price offer on a house because you hope to negotiate a little... maybe don't start with an offer price that is a LOT lower than the list price, the market value and where you hope to end up.

Let's know what the home is worth and make an offer that reflects that you're a serious buyer making a reasonable offer, even if you are trying to negotiate a bit.