Offering Buyer Incentives to sell a home, what do you think?

By
Real Estate Agent with Keller Williams Tampa Properties

Earlier today I was reading a blog post on Trulia written by their resident blogger Tara titled 4 Buyer Incentives that Sell Homes.  I like her blog and can generally pickup useful ideas to help my business, just as I do here on AR. 

The 4 buyer Incentives that she mentions are:

1. Offering an interest rate buy down

2. Kicking in a closing cost credit

3. Paying HOA dues for up to a year or more

4. Providing a Broker Incentive

All of these are good ideas and certainly may entice some buyers to choose a particular home over another and obviously the last incentive will probably encourage some/many agents to put a particular home on a showing list. But are any of them individually or collectively enough to make one home seem to provide more value than another in the eyes of a buyer.

In my experience, buyers today are looking at value.  Which home provides the most bang for the buck.  They get an approval from a lender for a certain maximum price and start looking in that range for whatever they have determined to be their "wants and needs".  They first determine which particular area or neighborhood they want to live in, then search for criteria such as number of bedrooms, baths, garage(s), pool...etc.  Obviously many other criteria enter into the picture, but rarely if ever do any of these 4 incentives, at least in the searching/viewing stage of the home purchase.

My thoughts on selling a home are simple; if it needs fixing, fix it!  If it needs painting, paint it!  If it needs replacing, replace it.  If it needs decluttering or staging, do it.  Then price the home at or slightly below "true" market price and let the home sell itself. "If" in the contract stage you are asked to provide any of these incentives, negotiate them, but offering them up front would make me believe that the home is over priced from the beginning.

Just my 2 cents!

 

Posted by

Real Estate Vet - Curing Tampa Bay's Mortgage Meltdown One Home At A Time.  Will your Home Be next?

Comments (3)

Roseanne Campagna
John L. Scott RE Maple Valley, WA - Maple Valley, WA
Kent/DesMoines/Blk Diamond/Renton/Maple Valley, WA

I think for the most part you are correct in your point of view. I share this view as well, except when there are similar homes to compare - then a buyer bonus could tip the scale...

Sep 03, 2011 04:44 PM
Jordon Wheeler
The Jordon Wheeler Group - Fairburn, GA
J W Group Real Estate Sales and Service

Hi Steven,

I read the same post on Trulia and was surprised by some of the comments left.  Especially the few angry sellers who lumped all real estate agents and brokers together.  Anyways, my experience has been that the incentives do work for certain buyers.

For example, an interest rate buy down can make a tremendous difference in the buyer's ability to afford the payment and have the home they dreamed about.  I had that happen last year on a new construction single family.  The buy down took the monthly payment from $1700 per month to about $1000 per month.  No way the buyer could have afford the home without the buy down and the builder might still have the home in his inventory.

The sale also had a positive impact on the values in the neighborhood which leads in the direction of recovery for that real estate market.

Best of success to you and thanks for your post!

Sep 03, 2011 04:51 PM
Daniel H. Fisher
www.FisherHermanRealty.com (704) 617-3544 - Charlotte, NC
MCRP - Charlotte Real Estate, NC or SC

We offer a bonus to the agent who brings an acceptable contract which closes by a certain date. Anything else seems like a tip that we have room to negotiate.

Sep 04, 2011 01:35 AM