With mortgage rates soaring , the real estate market here in the Twin Cities metro area in Minnesota, has taken a dip(in comparison to when rates were in the 3”s), prompting sellers to get creative with their concessions. As tempting as it may be to give in to every buyer demand to make a sale, be careful because some concessions could put you at a disadvantage. But don’t panic ,there are certain concessions that can be a game-changer in closing a deal!
- Paying for Repairs – Making repairs can be difficult, but offering partial closing costs towards required repairs can be a great concession.
- Listing at a Lower Price – Sellers may have to accept a lower offer than they would have a year ago. Pricing it at a competitive price.
- Interest Rate Buydowns – Sellers could offer buyers a credit to reduce their interest rate and make their monthly payment lower.
- Assisting with Closing Costs – Offering to cover part or all of the buyer’s closing costs can make your home more affordable and increase the chances of a successful sale.
- Allowing for a Longer Closing – Providing a buyer with a longer closing may allow them to pull together additional funds or research alternative lending options.
- Offering a Home Warranty – Offering a home warranty can be seen as a sign of good faith and can cover buyers against costly repairs and upkeep.
But beware! There are concessions that sellers should NOT make:
- Carpet and Painting Allowance – Don’t make any cosmetic improvements for a buyer, it’s better to credit them towards their closing costs.
- Allowing a Buyer to Move in Before Closing – This can be risky as the seller may have a hard time evicting the buyer if the sale falls through.
- Home for Sale Contingency – Allowing a buyer to guarantee their own home sale before finalizing buying a new one can be risky.
- Accepting Lowball Offers – Don’t accept offers that are significantly lower than your asking price. It can result in getting far less.
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