In my last post, I mentioned that you won’t be able to get EVERYTHING you want at the same time. No matter your budget, concessions will need to be made. This is true for both buyers AND sellers in the current market.
In the spring of 2022, when interest rates were low and it was considered a seller’s market, buyers who were making offers on properties knew they were likely up against a number of other interested parties.
Here are some examples of concessions they made in order to sweeten their deal and make their offer stand out:
- They waved inspections
- Paid appraisal gaps (this means the difference between the appraised value and the previously agreed upon purchase price)
- Offered tens of thousands (or more) over listing price
- Submitted offers immediately when the listing would go active (without even seeing the property!)
Reach out if you have questions about how to start the buying or selling (or investing, or building) process!
More recently, with interest rates on the rise, buyers are needing to shop in a lower price range than previously and pay a bit more per month for the same house.
While this can be looked at as a negative, buyers have gained a bit of leverage with the shift in market conditions. Today, buyers will probably get the luxury of a second showing. They won’t need to make such a rushed decision (such as offering on properties sight unseen), and they’ll have the opportunity for a home inspection and some negotiations, not to mention further concessions from the seller.
Here are some examples of more common concessions sellers are making:
- Repairs that are completed prior to closing
- Seller paid closing costs
- Seller paid rate buy downs
- Home warranty plans
- Closing and possession dates on buyer’s timeline
- Garage move-ins
- Lower purchase price
- Willingness to take or remove (or even leave) certain items or personal property. For some reason, I always find freezers to be a point of contention in negotiations.
Brick & Banister agent Jamie Abraham has several examples of instances where the closing and possession dates were part of the seller’s concessions during a deal. “I’ve had buyers do quicker closings and rent back to the seller, either for free or an agreed upon price per month, until the sellers actually wanted or needed to close (if they needed a long closing). I had one client who needed time to find a new house, one who was building and couldn’t move out until their new house was complete, and another client was buying a duplex and the seller needed to find another house to move into, so they rented from the new buyer until they had a new place.”
There’s a reason why we call the act of helping our buyers create an offer (or a counter offer for our sellers) “sculpting a deal.”
Price is almost always the biggest consideration in a purchase, but other factors like closing timeline, inspections, repairs, cash concessions, financing, personal property, and etiquette can play a big role in how a purchase or sale comes together and how well it STAYS together until closing. Our agents are always working through how to best put these elements together to create a win for our clients and get everyone through to a successful closing.
If you are thinking about buying a new house (and/or selling the one you have), reach out to us!
Our agents are as versed in the art of real estate negotiation as Michelangelo was in sculpting marble.