Buyer Incentives: Tips for Closing a Difficult Sale

What Incentives Should Home Sellers Offer Selling your home is not always easy. Real estate market volatility, local economic conditions, timing, and a number of other issues can have a negative effect on the level of buyer interest that sellers see, even when there are no notable flaws to be found in their home. On the other hand, a home that does exhibit some type of flaw in a good market can still take a good amount of effort to sell.

In both instances, buyer incentives can be an option for ramping up buyer interest. However, it is important for sellers to understand how these incentives work, and which situations they are typically used in. If you are not getting the level of buyer interest you need to get your Apple Valley home sold, consider using one of these currently popular buyer incentives to boost your home’s appeal. Before making any quick decisions, make sure to ask your real estate agent to see if offering incentives makes sense (or is allowed in your state) for your home’s specific situation.

Help Potential Buyers Get a Better Interest Rate

Even if current home mortgage interest rates are relatively low, helping buyers get a lower interest rate means an even lower monthly mortgage payment and better use of their monthly income. To do this, consider offering to buy down their mortgage interest rate as an incentive for purchasing your home.

As a seller, you may be able to buy down your buyer’s mortgage interest rate by paying an upfront fee, or points. This one-time payment on the seller’s part offers monthly savings to the buyer over the life of the loan, for as long as the loan terms remain the same. This type of incentive is particularly appealing for first-time homebuyers or those who are looking for the most economical way to own a home because of the month-after-month savings they will enjoy. 

Get Buyers Into the Home With Fewer Initial Costs

The process of purchasing a home and moving into it is often quite expensive for most buyers. Closing costs, moving expenses, utility hookups, replacing necessary furnishings or appliances, and other needs associated with the move add up quickly and can be financially draining for a potential home buyer.

If allowed in your state and by the lender, sellers who offer a cash incentive to their buyers at closing for non-recurring closing costs can help alleviate some of the buyer’s financial stress. For many home buyers, paying less cash at closing can be a very good reason to consider purchasing your home.

Sellers may also choose to add extra appeal for buyers by offering a cash credit at closing for specific performance. Examples include offering a credit to buyers who are willing and able to close by a certain date or within a specific time frame, or offering a credit at closing in return for a buyer’s willingness to allow the sellers to retain possession of the home for a fixed amount of time after the sale. Some sellers find this method to be helpful when trying to sell and move on a specific timeline.

Other popular credits sellers can offer buyers include those that can be used to purchase or upgrade something that will enhance the home, such as a credit for new carpeting, furniture, or appliances.

Offer to Include Valuable Items in the Sale

Another way to up the interest level in your home with potential buyers is to offer to include items that your buyers may want or need when purchasing the home. Items that work well for this include:

  • attractive furnishings, such as living room or dining room furnishings 
  • custom draperies, window coverings and decor items 
  • appliances not usually included, such washer and dryer sets or freezers 
  • specialty items, such as exercise equipment, above-ground pools, or outdoor furnishings 
  • lawn care equipment  
  • portable storage sheds 

Timing Buyer Incentives for Maximum Appeal

Offering buyer incentives successfully means using them when they will be most likely to help secure a sale. In a very slow market, buyer incentives offered during the marketing phase may attract a greater number of potential buyers to the home or condominium in Minnesota. In a competitive market, however, you may want to wait until you have an interested buyer and then offer an incentive to boost your home’s appeal to them over other homes they may be considering. 

When considering adding some type of buyer incentive to your home’s marketing plan, make sure to discuss the matter with your trusted real estate professional. They can help you decide which type of buyer incentive, if any, has the most potential for your particular home and market situation and how to time them effectively.

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