Whether buying a first home, a vacation home, or a forever home, everyone wants a good deal. In a seller’s market, buyers may find themselves in a bidding war for a property. Lowball offers are not going to win a seller’s favor. And asking for too many concessions may place your offer at the bottom of the pile. Even so, home buyers can still ask for some concessions when a seller is stuck on their list price.
Concessions Home Buyers Might Still Want to Ask For
Smart home buyers know about the importance of a home inspection. Even newly constructed homes can have their own issues. If an inspector finds problems with the property during their inspection, you may want to ask the seller for concessions like repair/replacement of the issue or a discount to help offset the cost to fix it. This then becomes a condition of the sale and protects your investment.
In a seller’s market, it is always good to be flexible whenever possible. Keep in mind that both you and the seller have to deal with a move of some kind once this deal closes. Therefore, if you remain flexible with the closing time, it may be enough to reach “winning bid” status. Ask your real estate agent to find out how quickly the seller needs the sale completed and how much time they need after close to find a new property. Then, present terms that fit their time frame and offer a short-term rent back option to ease any stress they feel over moving on to their next property.
Closing Cost Credit
Closing costs make up between 2% and 7% of the home’s purchase price. Buyers must pay this at the close of escrow. On a $500,000 home, that translates to between $10,000 and $35,000 dollars in addition to the downpayment. That can be rough for some buyers to swallow. So, if a seller decides to stick with their list price, you might consider asking them to help cover some of the closing costs instead. At least that helps ease some of the financial burden of the sale.
A Home Warranty
Finally, one of the last concessions I suggest buyers consider is to ask that the seller pay for a home warranty for at least the first 12 months. This covers any costs incurred if any major systems (HVAC, electrical, plumbing) or major appliance go “kaput” after the buyer takes ownership.
While home buyers may ask for any of these concessions, keep in mind that sellers do not like them. In a multiple-buyer situation, sellers may consider only offers with the fewest amount of restrictions. So, tread lightly. Consult with your REALTOR® before setting these limitations to paper. As always, when you are ready to start looking at properties for sale here at the Jersey Shore, contact me.