During slower times of the year (like winter) or for homes in less than desirable locations, a seller may have to look for ways to attract home buyers, especially if their home isn’t moving very quickly. Besides lowering your home’s asking price, you may want to consider offering an incentive or perk to make the transaction more enticing to buyers.
While some sellers may resort to gimmicky incentives like a new car or a vacation, you don’t have to offer anything so extravagant. You can peak a potential buyer’s interest by filling a specific need they may have related to the home’s purchase.
Here are 4 common incentives that sellers have used to persuade potential buyers into purchasing their home.
- Buy down the interest rate. To purchase a home, most home buyers have to get a mortgage loan, which means the lender will charge them an annual interest rate. This interest rate is based on the market at the time the borrower applies for the loan. For borrowers who want to lock in an even lower rate, they can buy down the rate by paying additional points or upfront fees. As the seller, you can offer to pay points for the buyer – helping them to save money, which may sway them to purchase your home.
- Including personal goods in the sale. When you sell a home, anything that is attached to the property and can’t be easily removed must be included in the sale. However, other items like furniture, appliances, window coverings or exercise equipment are your personal items that you can take with you when you move – or not. Sometimes, buyers may want to purchase some of these items from you, too. Or, you may wish to include them in the home sale. For example, you don’t want to move bulky appliances. Or, your current furniture doesn’t match your new home’s look.
- Pay for closing costs. Closing costs are fees charged by the lender or escrow company to process the paperwork needed to complete the real estate transaction. Common closing costs include title insurance and title search fees, escrow fees and inspection fees. You may want to offer to pay “up to” a certain predetermined amount toward the buyer’s closing costs.
- Offer an allowance for needed home repairs. Following a home inspection, a buyer may come back and ask you to make repairs, such as replacing the roof or repairing electrical wiring. Since most sellers don’t want to hassle with making the repairs themselves, they may offer a credit to the buyer. A credit provides the buyer with cash at closing to make the repairs when they see fit.
Talk to your real estate agent for advice on offering incentives. And weight your options carefully against your budget. With the right incentive, your home may be sporting a “pending sale” sign in no time.
If you’re selling your home in order to purchase a new one, chances are good you’ll need a new mortgage. The mortgage specialists at Grandview Lending in Indianapolis can help you find the right mortgage option based on your needs. Call us today at 866.690.4920 for more information and to start the application process.
Photo credit: 123RF / Khanong Wilboolkul