The following comment is from Jessica Beganski, a buyer's agent in Connecticut, describing a methodology she uses with buyers when pricing an offer.
Steal/Deal/Real are the three stages of an offer or three price points to consider when putting together an offer.
Steal - is the amount you would love to pay and represents a price that is significantly under market value. You know, the price you would brag about to all your friends and relatives.
Deal - an amount you would pay for a house that still represents a savings, although not grossly under market value.
Real - This is real market value - not the list price. This is the highest price a buyer would be willing to pay.
Before I discuss an initial offer amount with clients, I tell them to think of these three prices up front. What price would represent a “steal”, then the price that would be a “deal” and then the amount that would be “real.” I have them write it down on a piece of paper and save it.
In this way, I have prepared my clients for the negotiation process in advance. Not all clients choose to go this route and go directly to a “real” offer or start with the “deal” offer first. Others only want to pay the “steal” price and if it’s not accepted, we move on.
It is up to the buyer to evaluate his/her comfort with the risk of losing out on a home to another buyer by offering lower than “real”. Although less commonplace in my area (Connecticut) than before, I am still running into multiple offer situations on well-priced houses.
Conversely, there is the risk of overpaying. Again, it’s up to the buyer to determine which and how much risk he/she is willing to take.
Hope this information is helpful to you in making an offer.