5 Incentives to Give to Potential Homebuyers
Are you struggling to sell your home? You may have to think harder and get creative to market your house fast. One of the common issues that deters potential homebuyers is having repairs necessary before they can move in. Fortunately, there are reliable insurance providers and home appliance warranties to help them cover these costs. But it’s still best to prepare a move-in ready home for your clients. Additionally, there are incentives you can offer to sweeten the deal, including:
- Seller-paid Interest Rate Buy-downs. One powerful incentive to attract a potential homebuyer is to offer to award them a specific number of percentage points of the purchase price. These points will be paid to their lender as discount points, which can reduce the mortgage interest rate.
For many buyers, this is a big deal. Not only will this help ease the stress over guessing the best time to lock in the interest rate, but it also sends the message that if they close the deal with you and make the purchase, they’ll automatically upend the market rate.
Additionally, an interest rate buy-down helps the buyer save money on their monthly mortgage payment during their loan term. The points are also typically tax-deductible the next time the buyer files their taxes.
- Closing Cost Credit. Closing on a house can be very expensive, leaving homebuyers with nothing left over after they’ve become homeowners. Additional expenses that generally come after buying a new home include new furniture as well as restoration and renovation costs. The mere thought of these extra obligations being on the horizon can keep potential buyers from entering the market.
As a seller, offering credits to cover closing costs may seem like you’re footing the bill for the fees that the buyer is supposed to cover. But what you’re really doing is giving them the chance to buy your home in the first place. This incentive becomes a game-changer, especially if your house needs some repairs and upgrades to make it desirable. Your potential buyer will need some breathing room to bring your house up to standard. You can help them achieve this by offering closing cost credit.
- Home Warranty. When selling a home, you’ll notice how tough the market can be. Many homebuyers also seem to expect more for their money. But one way to appeal to your client is to offer a home warranty. A home warranty will cover repair costs for major home systems and appliances for a set amount of time after the home purchase. Many people who intend to buy an older home will choose to get a warranty, if you haven’t already offered. So, this incentive can be a great sales feature. Just ensure that you research the provider and what their home warranty covers before signing the contract.
- Homeowners’ Association (HOA) Dues Credit. Are you selling a home that belongs to an HOA? If so, then you’re probably paying monthly or annual dues. You know how these charges can be overwhelming, especially when you’re already dealing with a laundry list of routine expenses like your mortgage. To help your home stand out from all the other nearby listings, try offering an HOA dues credit at closing. You may offer to cover the potential homebuyer’s HOA dues for six months, a year or two, or maybe even longer. Just consult your real estate agent on how to go about this strategically.
- Broker Incentives. At least 90 percent of today’s homebuyers who are willing and capable of purchasing a new home are represented by an agent or broker. If you can’t afford to offer your client an interest rate buy-down, closing cost credit, or HOA dues credit, offer bonus percentage points (on top of the commission) to their eventual agent or broker instead. By offering broker incentives, you have a better chance of setting your home apart from close competition. While this is not exactly considered a buyer incentive, it still can help boost your odds of getting an offer more quickly.
You can get more homebuyers in the door by putting incentives out there as part of your marketing. So, if you think your home may be a tough sell, start considering these incentives. If you’ve come close to negotiating a deal with a buyer but are stuck, pulling out one or more of these incentives at the eleventh hour can go a long way in moving the sale over the finish line.
Having Trouble Selling Your House?
For a quick and easy transaction, you can always reach out to us to sell your Austin home. After evaluating your property, our team will give a fair offer with little work to be done on your end.
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