How to Make an Offer on a House: A Complete Walkthrough

Making an offer on a house is a moment that combines financial strategy, legal documentation, and emotional pressure into a single decision. Most buyers have one chance to get it right — or at least right enough to start a productive negotiation. Understanding every component of a purchase offer before you submit it dramatically improves your odds of success.

This guide walks through the complete offer process, from determining your price to what happens after the seller responds.

What’s Included in a Purchase Offer

A residential purchase offer is a legally binding contract — not an expression of interest. Once both parties sign, you’re in contract with real obligations and real consequences for failing to meet them. Understanding what you’re agreeing to is essential.

A standard purchase offer includes:

The parties: Full legal names of all buyers and all sellers, exactly as they appear on government ID (which must match the deed).

Property description: The legal address and, in many cases, the full legal description from the public record.

Purchase price: The dollar amount you’re offering to pay.

Earnest money: The deposit you’ll place in escrow within a specified number of days of acceptance, demonstrating your commitment.

Financing terms: The loan amount, loan type (conventional, FHA, VA, USDA), and whether the offer is contingent on financing.

Contingencies: Conditions that must be met for the sale to proceed — inspection, appraisal, financing, and sometimes sale of a current home.

Included and excluded items: Appliances, fixtures, and personal property that are part of the deal (or explicitly excluded).

Closing date: The date by which all funds are transferred and ownership changes hands.

Offer expiration: How long the seller has to respond before your offer expires.

Disclosures acknowledgment: That you’ve received and reviewed required disclosures.

The National Association of Realtors provides guidance on standard contract terms by state — because while the general framework is consistent, state-specific forms and conventions vary considerably.

How to Determine Your Offer Price

Your offer price should be grounded in market data, not the listing price. The listing price is the seller’s opening position; comparable sales tell you what the market actually supports.

Analyzing Comparable Sales

Work with your buyer’s agent to pull a comparative market analysis (CMA). Look for homes similar in:

• Square footage (within 15–20%)
• Bedroom and bathroom count
• Location (same neighborhood or immediate surrounding area)
• Age and condition
• Lot size and features

Focus on sales from the past 60–90 days. In fast-moving markets, 30 days is even better. Calculate the price per square foot for comparable sales and apply that range to your target property, adjusting for meaningful differences.

Zillow Research publishes market data at the neighborhood level that can supplement your agent’s MLS analysis, though MLS data is typically more granular and accurate.

Adjusting for Market Conditions and Seller Motivation

Once you have a range supported by comps, adjust based on:

Days on market: A home that’s been sitting for 60+ days with no price reduction likely has an overpriced or unrealistic seller. A home that listed three days ago may see multiple offers.

Price reduction history: A seller who has already reduced twice is signaling flexibility. A home at its original price after 90 days is a seller who hasn’t accepted reality yet.

Seller situation: Vacant homes (carrying costs) and homes with disclosed timelines (relocation, divorce, estate sale) typically have more motivated sellers.

Market conditions: In a clear buyer’s market, you have room to offer below fair value and negotiate up. In a competitive seller’s market, your first offer may need to be your strongest. For guidance on reading your specific market, Redfin’s research publishes monthly supply and demand data at the city level.

Contingencies: Your Safety Net

Contingencies are conditions written into the contract that allow you to exit the transaction — usually with your earnest money refunded — if specific circumstances arise. They are your primary protection as a buyer.

Inspection Contingency

Gives you the right to have the home professionally inspected within a specified period (typically 5–10 days) and to negotiate repairs, credits, or exit the contract based on findings.

In competitive markets, buyers sometimes waive this contingency to make offers more attractive. This carries real risk and should only be considered when you have significant cash reserves and a high tolerance for condition uncertainty.

Financing Contingency

Protects you if your loan is not approved. If your lender denies your application before closing, this contingency allows you to exit without forfeiting your earnest money. Sellers dislike financing contingencies because they introduce uncertainty; pre-approval with a strong lender helps reassure them.

Appraisal Contingency

Protects you if the home appraises below the purchase price. If the appraisal comes in low, you can negotiate the price, cover the gap in cash, or exit the contract. Bankrate’s resources on appraisals explain how appraisals work and what your options are when they come in low.

Home Sale Contingency

If you need to sell your current home to finance the purchase, this contingency protects you. Sellers tend to dislike these heavily — in competitive markets, you’ll rarely get them accepted unless your current home is already under contract.

For a comprehensive look at how to use contingencies strategically, see our guide on making a strong offer on a house.

Earnest Money: Signaling Serious Intent

Earnest money is a deposit you make within a few days of the seller accepting your offer. It goes into an escrow account managed by a neutral third party — not directly to the seller.

Typical amounts range from 1–3% of the purchase price, though in competitive markets, 3–5% or even more is common. The earnest money:

• Demonstrates your commitment to the seller
• Is applied toward your down payment or closing costs at closing
• Is at risk of forfeiture if you back out without a contractual contingency to protect you

For a complete explanation of how earnest money works, when it’s refundable, and how to protect it, see our dedicated guide on earnest money deposit explained.

Timeline and Deadlines

Purchase contracts are date-driven. Missing a deadline can cost you your contingency protections or put you in default. Key dates to track:

• Earnest money due date — typically 1–3 business days after acceptance
• Inspection period expiration — the deadline to complete your inspection and submit any requests
• Appraisal deadline — when the lender must complete the appraisal
• Loan commitment date — when your lender must provide formal loan approval
• Final walk-through — typically 24–48 hours before closing
• Closing date — when funds transfer and ownership changes

Create a calendar the moment your offer is accepted and set reminders for each date. Missing your loan commitment date, for example, can put you in technical default even if the loan was eventually approved.

The Consumer Financial Protection Bureau maintains a home buying timeline resource that helps buyers understand what happens in each phase of escrow.

Submitting Through Your Agent

Your buyer’s agent handles the mechanics of submitting your offer. Digitally signed contracts via platforms like DocuSign or Authentisign are standard across most markets. Your agent will:

1. Prepare the purchase agreement on the appropriate state form
2. Add any addenda (financing addendum, inspection addendum, escalation clause if applicable)
3. Attach your pre-approval letter and proof of funds
4. Communicate the offer to the listing agent, often with a personal call to build rapport
5. Set a deadline for the seller’s response (typically 24–48 hours)

The accompanying communication your agent sends with the offer can matter: listing agents often relay buyer stories and motivation to their clients, and a seller may feel better about accepting an offer from someone who genuinely loves the home.

What Happens After You Submit

Once your offer is submitted, one of four things happens:

Acceptance: The seller signs the contract as presented. You’re now in contract and the clock starts on all your contingency deadlines.

Counter-offer: The seller changes one or more terms — typically price, closing date, or contingency terms — and returns it for your consideration. You can accept, counter again, or reject.

Multiple counter-offers: In some states, sellers can counter multiple buyers simultaneously, creating a de facto auction. Your agent should alert you to this situation.

Rejection or no response: The seller declines or lets your offer expire. Your earnest money is not at risk at this stage (since you haven’t deposited it yet), and you can move on to other properties.

Most transactions involve at least one round of back-and-forth. Investopedia’s home buying resources recommend that buyers establish their walk-away price before they receive a counter-offer — the excitement of being in negotiation can push buyers to accept terms they wouldn’t have agreed to with a clear head.

When your offer is accepted, the real work begins: inspections, appraisal, loan processing, and title review. But the offer is the foundation everything else is built on — and a well-constructed offer sets the right tone for the entire transaction.