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Attract more Buyers without Lowering your Price

By Michael Hitchcock

Real Estate Agent with Coldwell Banker | Honig-Bell

August 07, 2007 10:19 AM

As the Joliet, Plainfield, and other markets slow down and shift to favor buyers, many homeowners are struggling to sell their house. While some sellers are utilizing home warranty programs to entice buyers and compete with the abundance of homes on the market, savvy sellers and realtors are offering special buy-down options to attract more buyers without lowering their price.

It's a win-win situation in which a seller can "buy-down" the interest rate for the buyer. This typically will cost the seller less money than lowering their price, yet it will save the buyer more money in interest than if they purchase the home at a lower price. Additionally, it can help more buyers qualify for financing. Call, email, or post comments for more details on this really great option! It can help you save $1000's!!

Best Wishes,

Mike

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Doug Aaserude

Inactive until May. 2009 - Beaverton, OR

Broker

i have heard much about this strategy. i must call my lender to learn more about this option. thanks for the reminder to do so.

Aug 07, 2007 10:40 AM

» Bill Burress Nationwide Mortgage Originator

» Bill Burress Nationwide Mortgage Originator - Fort Myers, FL

Michael:

Good idea. When offering incentives make sure the seller has wiggle room. What may appeal to one buyer, may not appeal to another. The bottom line is the bottom line. First define how much you have to work with, then uncover the hot button and then offer it.

While buying down the rate might seem like a good idea, most lenders have a maximum amount of financing concessions which they allow a seller to contribute.

Aug 07, 2007 11:12 AM

Linda Reynolds

Bradenton Real Estate - Linda Reynolds - Bradenton, FL

Bradenton Real Estate

That is a great idea I am going to pass that idea along to my sellers and see what they think of the idea.

Aug 07, 2007 11:46 AM

Michael Hitchcock

Coldwell Banker | Honig-Bell - Joliet, IL

Douglas & Linda - Thanks for the comments. Goodluck! Let me know how it works out for you.

Bill - You are correct. You must establish limitations with those involved. In a buyer's market, many lenders and realtors are counselling their buyers to ask for seller concessions. The way we work it in our office is to set a limit (usually 3%), and stipulate that the buyer must offer asking price to get 3% back or else all bets are off. Of course, we allow the buyer to decide how they use the money back... whether to buydown their rate or cover some of their closing costs. In the end, buying down their rate will usually save them the most moeny. It's just another form of seller concession that is less drastic and has the ability to save both sides tons of money. Great ideas and points Bill!

Aug 07, 2007 01:28 PM

Adam Waldman

Westcott Group Real Estate Company - Hauppauge, NY

Realtor - Long Island

Michael, I just started using this myself recently. After today's fallout with the Jumbo market, I have a feeling that this is going to become more of a necessity than just an underused marketing tool. I'm glad that I already understand the process, because it puts me a step up on the competition.

Aug 07, 2007 01:54 PM

Adam - You're so right! Another tool for the toolbox. The more options we give our sellers, the better outcome and the more satisfied. Even if they don't go for it, it conveys that you truly care about them keeping as much as they can and also that you know what you're doing.

Aug 07, 2007 02:01 PM

Attract more Buyers without Lowering your Price

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Michael Hitchcock

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