Congratulations on getting an offer! Something you and your agent are doing must be right for a Buyer to find your home and think enough of it to make an offer to buy it. Now...what to do with it? Low offers often create emotion and frustration. Nothing will be accomplished if you get mad at the Buyer. Buyers are doing the best they can for themselves ... like you and your agent will do for you on your side of the negotiations.
The first thing to do is to assess the Buyer's motives. Is this a Buyer that is reaching, hoping to buy your home at a price he can really afford? Such a Buyer reaches beyond his means, but with a little luck, and your price acquiescence, he can enjoy such a home one "upgrade" sooner than he would otherwise be able to. This Buyer is maxed out at the low offer price.
Other Buyers are simply "bottom fishing", looking for the deal of a lifetime. They are going to offer low regardless of how well you are priced. This type of Buyer uses your list price as a starting point rather than looking at where you are priced relative to the market. A home priced right in this market is not a sign of weakness, in fact most often it is just the opposite - it is a sign of someone that is not upside down in their property, is realistic about what is going on, and is ready to get on with his life. It is amusing when a low ball operator makes a low offer on a well priced home- their tactics are pretty well exposed. If you are priced right - stay your course.
There seems to be yet another category of low-offer Buyers these days - those claiming that they are topped out at where they are offering. We've had this happen several times lately where we received a very, very low offer, made a counter, received a little adjustment from the Buyer and were told they were maxed out. In one case the Buyer later came back $40,000 higher when he had competition (he was too late and lost the house!). In another, the transaction didn't close, and the Buyer bought a home for $50,000 more than the "most they qualify for". Both of these homes were in the low $200k range so these amounts were significant relative to the total price. Your agent can help you decide what to do if your Buyer "can't pay more". Can't ... or won't?
Our Advice: Work with your agent to determine the Buyer's situation/motivation. If they are playing games and you quit you'll never close with them. If you play with them- stick to your goals, and if the transaction is meant to be it will go together. There's nothing wrong with a little "ping pong" negotiation if your objectives are ultimately met - it just takes a little longer. Don't blame them for making a low offer - many Buyers think they have to try it. What happens afterwards is what counts. If they are trying to steal something, and you won't let go, they will have to find another home. If they aren't realistic, you didn't lose anything by not working/playing with them - you never had them to begin with. Appreciate that your agent is doing a good marketing job to have your home be selected as the one they offered on.
Be honest with yourself - is the offer closer to the real value than your list price? Maybe the Buyer is checking your "expectations vs. reality" in hopes you will come to your senses and they can buy it at a fair price. It's a good time to go over your own goals and objectives.