Your Realtor will do the comps for you to show you how the home is priced compared to the market place. If the home is overpriced, a lower offer is reasonable (but keep in mind that in the seller's mind, the home is priced correctly), BUT, if the seller has already priced the home at or below market value and you come in with a lower price, it will show the seller that you haven't done your homework at all and you don't know value when you see it. If they are already below market rate, then they have already discounted the home for you. They may still lower it a bit, but don't expect them to lower it by a lot. Now there are a lot of factors involved in negotiating a price point - I've seen sellers take less, because the are relocating and their company will give them a bonus if they sell their home by XX date and the company doesn't have to buy them out, but not every seller has that kind of a relo package. I've seen others take a lower deal because they have 2 mortgages and the wife just gave birth to their 3rd child and they want it done, but not every seller is in that position. For most, they want the most they can get for their home, just as you want the least you can pay for it. BUT it has to be a win-win for both, or they won't accept your offer.
One of the most important things to consider in all of this is YOU - if you give a low offer and someone else comes in 1-2 thousand above you and trumps you and gets the house, how much will you kick yourself? Is this truly the right home for you and your family? Do you intend to be in it for several years? Is it a home that will continue to appreciate or where you will be able to go in and do a few things and get some sweat equity fairly quickly? All of those play a part in what the home is worth to you. In St Louis Hills the market is steady. I constantly see buyers who want THAT area and are willing to pay a premium to get it. And as Eva pointed out, in St Louis, our sellers are still getting close to their asking price in that part of the city and if it's a nice home how much longer is it going to be available .