If you're currently selling your home or just thinking about it, consider a few ways to sweeten the pot for your potential buyers. Whether selling or buying, here are some ideas you should be aware of, and often your agent will not tell you these.

Wise home sellers know that incentives can be the things that tip the deal to their favor. By giving buyers something a little out of the ordinary, or something that allows them  to feel like they've "won", you may significantly improve your chances of selling your home quickly and for the price you want.

We suggest the following to our clients, who will end up selling their homes faster and, in the end, for more money. One thing we've seen with sellers - they often can't see the forest for the trees - they get stuck on not giving up small dollar items that could yield them big dollars returned.

Picture of dollar signPay at least a portion of the buyer's closing costs

Many buyers are worried about saving enough cash for their down payment and overlook their closing costs. These may add up to between 3 and 6 percent of the sale price, and can amount to thousands of unanticipated dollars. Many buyers (and their agents) overlook asking for help with these fees, which is a negotiable item on the deal. Offering to pay a bit may tip the deal in your favor. Sometimes you can also negotiate raising the purchase price and adding more closing costs to cover their mortgage fees completely. Be careful here to not go above what an appraiser will value your home for, however this technique works in many cases and the net to you is the same.

Picture of percent signHelp the buyer get a better mortgage rate

Offer to purchase discount points on the buyer's mortgage. These are a financial mechanism the lending institution uses to bring in cash up front, and will result in a slightly lower interest rate on a mortgage. They are attractive to a buyer because not only because they reduce the monthly payment, but they reduce the overall total cost of the mortgage, which could potentially save them thousands. Usually, one point is the same as 1% of the loan amount and will reduce the interest rate by one quarter percent (0.25%). Ideally you would then advertise "below market financing" to help to bring additional prospects to your home. As savvy real estate professionals know, selling is a numbers game - the more traffic you have, the better your odds of finding the right buyer.

Picture of shouting personOvercome immediate objections

A simple and effective tactic to help close a sale is to quickly offer to address any concerns a potential buyer may have with your property. Your goal is to move the buyer off the fence and commit to the deal. If painting the front porch or a room or two will make your buyer commit, a few hundred dollars for a painter can be well worth it. Perhaps you could even do it yourself. You could also offer an allowance for improving the lawn, landscaping, carpet or anything else that the buyer raises objections to. Buyers typically will purchase the home that has the least amount of work to do - the one that is most move-in ready.

Picture of refrigeratorAdd value to your freebies

Planning on buying some new furniture, upgrade appliances, installing new light fixtures for the new home that you're buying? If the ones at your current home are in good condition you can sweeten the pot by including them as items of value in a counter offer, or advertise them up front as part of the deal. First-time home buyers will love this, as they usually don't have much of their own furniture, appliances or money. It has the added benefit of reducing what you have to move to your next home. Don't just add them to your Seller's Disclosure - a smart real estate agent will advise you to advertise them!

Picture of warrantyThe Home Owner's Warranty

We almost always advise our clients to consider offering a home warranty to the buyer. This low-cost insurance is available for around $350-400 for basic coverage. By adding a layer of formal insurance on the deal, your buyers will feel secure in knowing that should any item go wrong with the home, they may be covered. Note we say may - there are different levels of coverage - which can be added to the policy after closing at the buyers expense. Simply having insurance that covers electrical, plumbing, major appliances and possibly heating/cooling systems can help seal the deal. This small investment could be worth thousands.

  Other Ideas

Incentives lure buyers - it's what advertising is all about. Your real estate agent is in the advertising & marketing business, and a good one should let you know that you can offer other goodies as well, some of which may cost you nothing. Perhaps you could redeem credit card points to offer a substantial home store gift certificate to your buyer. We've seen other items such as TVs, airline tickets, club memberships, and even cars being used as incentives. Your smart agent will suggest using all ammunition when advertising your home to the millions of potential internet prospects.

Your agent as your secret weapon

Your agent should be your home sale advocate, and should review these techniques with you prior to any offer. If they are just looking for a listing and simply want your signature on a contract, or do not give you the personal service you deserve, consider looking further for a better agency.

-Peter Rand

Broker/Owner
Rand Realty LLC
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