A fair offer on a house is one that reflects the property’s genuine market value — supported by recent comparable sales, adjusted for condition and features, and calibrated to current market conditions. Most buyers either offer too much (because they are emotionally attached) or too little (because they are afraid of overpaying). Both approaches cost money. This guide explains exactly how to work out what a fair offer looks like before you put pen to paper.

How to Calculate a Fair Offer Price

Step 1 — Find Genuine Comparable Sales

A comparable sale is a property that is genuinely similar to the one you are buying — similar size, similar land area, similar condition, similar location, sold within the last 90 days. The most common mistake buyers make is using comparables that are too old, too different in condition, or in a different micro-location (even a different street can matter in some suburbs).

Where to find comparables:

• Domain and REA sold listings (free, but delayed by 30 to 90 days)
• CoreLogic or PropTrack (more current, requires subscription or access through an advisor)
• Your Collings Property Advisor (direct access to current sales data with professional interpretation)

Step 2 — Adjust for Differences

No two properties are identical. Once you have found your comparables, adjust for the key differences:

• Land size: More land is worth more, particularly on development-potential blocks. In Melbourne’s inner-north, land premiums of $400 to $800 per square metre are common.
• Condition: A renovated property will command a premium over an unrenovated comparable. Quantify the renovation cost to understand how much of the premium is justified.
• Orientation and aspect: North-facing living areas and gardens consistently command premiums of 5 to 10% in Melbourne.
• Street position: Corner blocks, busy roads, and power line proximity all affect value.
• Views or outlook: Meaningful views add value; industrial or unattractive outlooks detract from it.

Step 3 — Factor in Market Conditions

In a rising market, recent comparables may understate what buyers are currently willing to pay. In a softening market, they may overstate it. Understanding whether the market has moved in the last 30 to 90 days is critical to calibrating your offer correctly.

Step 4 — Calculate Your Offer Range

A fair offer is typically within a range of plus or minus 5% of your assessed market value. Your opening offer might be at the lower end of that range (to create negotiation room), while your walk-away price should be at or just above your assessed value.

Common Mistakes When Making an Offer

• Anchoring to the asking price. The asking price reflects what the vendor wants — not what the market will pay. Always anchor to your own comparable sales analysis.
• Offering a round number that signals inexperience. An offer of $985,000 rather than $980,000 signals that you have done your analysis and this is a considered figure.
• Making an offer without a negotiation strategy. Your first offer should leave room to move without going above your walk-away price.
• Letting emotion override analysis. Overpaying for a property you love is one of the most expensive financial decisions you can make.

How a Property Advisor Helps You Make the Right Offer

A Collings Property Advisor will run the comparable sales analysis for you, adjust for property-specific factors, interpret current market conditions, and prepare a defensible offer strategy — before you engage with the agent. This removes the guesswork and the emotional bias that costs most buyers money.

For a fixed fee of $4,500 + GST, you get professional property analysis, a negotiation strategy, and expert representation in the agent negotiation.

Frequently Asked Questions

Should I offer below asking price?

That depends entirely on the comparable sales analysis. If the asking price is above market value, offering below it is correct. If the asking price is at or below market value, offering below it may lose you the property.

How much below asking price is too low?

An offer more than 10 to 15% below asking price is generally considered a low-ball offer and may be rejected without counter. Unless the property has been significantly overpriced or has material issues, a better approach is to anchor to your comparable sales analysis rather than to the asking price.

What happens if my offer is rejected?

A rejected offer is the start of a negotiation, not the end of it. Your property advisor can help you decide whether to increase your offer, hold your position, or walk away — based on the comparable sales evidence and market conditions.

Do I need a property advisor to make an offer on a house?

No — but having one significantly improves your outcome. Most buyers who engage a Collings Property Advisor at the offer stage recover the $4,500 advisory fee many times over through a better-negotiated price.

Get Expert Help With Your Offer Strategy

A Collings Property Advisor will run the comparable sales analysis, prepare your offer strategy, and handle the agent negotiation on your behalf — for a fixed fee of $4,500 + GST.

Book a free 15-minute consultation today. Visit collings.com.au/property-advisory or call us to speak with a property advisor today.