Asides

Selling a home in a Buyer’s Market

Even though the market has been slowing this year (get stats here) , sellers find incentives that appeal to a buyer’s wallet can be effective in creating more interest and in getting close to the full asking price. Below are some incentives that may help set your home apart from the rest:

Buying down the mortgage – The sub-prime mortgage crisis has tightened available credit as well as lenders expectations. Sellers who offer to pay mortgage points for the buyer (sometimes referred to as “buying down the mortgage”) are more likely to attract buyers who are nervous about their monthly payments or interest rate. Each point you pay equals 1 percent of the loan amount, so mortgage buy downs lower both the interest rate and the monthly payment.

Offer to pay off a buyer’s bills – According to Realty Times, some loan programs allow sellers to pay off the credit card debt or auto loans of the buyer which will help him or her qualify for a better mortgage and prevent the need to buy a smaller, less expensive house.

Closing Costs – Although many buyers will request this in their offer to purchase you may attract more offers if you make it available up front. Legal fees, title insurance, filing fees - closing costs can add up in a hurry for buyers, typically totaling somewhere between 2 and 7 percent of the total loan amount. Sellers who offer to assist with the closing costs will appeal to cash buyers short on cash

Home Warranty - Including a year (or two) of home warranty coverage serves as a peace of mind for the buyer that they won’t have to foot the bill for unexpected repairs in the first year or two of ownership. Most policies include service to the home’s HVAC, interior plumbing, appliances and major fixtures. The low cost of home warranties (typically a few hundred dollars) makes them a low risk-high reward incentive to offer.

Maintenance Fees - Some features of a home that you may consider “selling points” (pool, hot tub, sauna, gas fireplace, AC system, etc) can actually seem like detractions to buyers due to their related maintenance costs. You can assuage a buyer’s concerns by offering to pay for the first year’s worth of maintenance.

Landscaping - Offering to spring for a few additional landscape features can be a nice way to let buyers add personal touches to the property without taking on personal expense. Keep in mind that adding such touches on before putting the home on the market may have a greater impact (provided, of course that your landscaping choices aren’t woefully misguided).

Condo/Homeowner’s Association Fees - Paying the first year’s fees could be a big incentive to a buyer nearing the limit of his or her liquid assets.

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