You could have written back, "I'm looking for something closer to $700".
But now you have a problem. Whatever you write back to this person, they know that they are your best offer so far, and that you are very keen to deal with them. That puts them at an advantage.
You could write back and say "I'm willing to negotiate. How does $625 sound?"
PS: Don't say, "Can we deal at $700?" That's already been rejected out of hand by the lack of reply.