5 Home Buyer Incentives

In any market there are sellers who are driven to get it over with, and just want to move. Often times these deals are driven by incentives, which inspire sellers to make their homes more attractive. Some sellers even have to put a little more effort during the slower months when homes don’t move as quickly.

If you are wanting to sell your home, but are concerned it could be a difficult one to sell, try offering buyers something that will be difficult to walk away from. Below are several ideas you might not have thought of, which can be offered from the start, or thrown in along the way to keep the buyer close.

Buying the interest rate down

Very rarely does a home buyer not need a mortgage to buy their house, but for the rest of us that do this one’s for you. Banks look into several factors before loaning money, such as the condition of the market, and when you apply. When you want to get a low rate, you usually will be forced to pay an upfront fee, called a point. Paying this upfront is called “buying down the rate,” and sellers have the power to do this for the buyer too.

Let’s say the bank offers the buyer three percent on a30-year fixed mortgage, the buyer or seller can then pay one percent of the loan amount to receive an interest rate in the ballpark of 2.75 percent. This is lower payments for the buyer, which could save him tremendously in the long run. The savings could be even greater if you have a higher rate on y our 30-year note.

Include window coverings and furniture

Buying furniture if you have none can be quite an expensive ordeal. Some homeowners will renovate their homes, and then pick furniture that best fits their new look. It’s also not uncommon for buyers to offer to buy the furniture inside.

If your home has specific furniture that might not fit well in your new home, try offering the furniture along with the sale of the home. It could also save you a bit on moving, depending if you hire a moving company.

Credit for non-recurring closing costs

After a home’s inspection, most buyers reach out to the owner and ask them to make some repairs to the home, sometimes including tiny holes, to patching areas on the roof, to repairing dry rot, and even to replace windows. Most sellers don’t want to do anything more than what they’ve already offered, and if not done completely can hold up the entire closing.

If you want to incentivize buyers, try offering them a credit for non-recurring closing costs, as this credit goes to the buyer as cash in their pockets after closing. Most buyers ask for credits and don’t do the repairs themselves for months. Best to give them cash and let them handle it.

Offer buyer’s brokers a bigger commission

Listing agents typically market their homes to the agents who have buyers. Good buying agents should push for all homes that meet their needs despite the commission. Given this, it isn’t unusual for the seller to offer up to an entire percentage point bonus commission to the buyer’s agent for a property that won’t move. These deals usually happen between offices and word of mouth in the community. Good agents are well connected, and keep tabs on what’s happening in the market.

Credit for “close by” date

Motivated sellers could have numerous reasons why they want a quick closing. No matter the reason, the consequences of the sale date justify offering a small bonus or credit for potential buyers if they close by a certain date.

 If a seller has landed a new job in another state, and needs to get rid of his home, they’re looking at a large property tax bill at the end of the year if they don’t get it sold. The tax liability could be a bigger problem outside of the real estate transaction.

In this case, the seller can offer a credit to the buyer, and if they’re extra hurried, offer a bonus commission to the buyer’s agent.

Selling and offering incentives can be promoted in several ways – some have more built-in strategy, others not so much. Your incentives will surely get buyers interested and in the door, so if you are having a difficult time selling your home, consider these strategies. If you have a buyer who is on the fence, float some of these his way and see what happens. 

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