Sweeten the Deal and Sell your Home!!!!
At a Superbowl party this weekend, a “desperate to sell” homeowner ask if there were any tricks to help him sell his home in a down housing market. He said he had tried all the regular ideas like cleaning the house, organizing it and pricing it right, but nothing was working. He ask, “What else might we do to attract a buyer?”
If you’ve tried all the traditional home selling tips, it may be time to consider a creative incentive to get the ball rolling.
1. Buy the Buyer an Attractive Mortgage Rate: Pay “points” upfront to the lender to permanently or temporarily buy down the borrowers interest rate. Buying the rate down is smart for a number of reasons. First, a lower interest rate will reduce the buyers monthly payment making your home more affordable. Secondly, since the buyer must qualify for a loan, a lower payment means people who earn less money can qualify to buy your home. Thirdly, “Below Market Financing” sets you apart, when advertising your property.
2. Pay the Buyers Closing Costs:
With housing prices at record highs, many buyers find themselves coming up short on the cash needed for closing. Make your home more attractive to cash strapped home shoppers by offering to pay their closing costs. A little cash savings may make all the difference between a buyers ability to buy your home or not.
3. Offer Seller Financing:
Seller financing is very attractive because it is cheaper, quicker and more convenient than borrowing from a traditional lender. There are risks, such as loan default, but if you need to sell, owner financing is a powerful tool. Note that you can cut your risk of default by insisting the buyer make a larger down payment, which they forfeit if they default. And, always hire a real estate attorney to draft the loan documents.
4. Give Aways and Freebies:
Home sellers, take a marketing clue from home builders and developers. Use freebies during market downturns to lure buyers with things they can’t live without. The real estate pro’s offer buyers everything from free appliances, trips, gift certificates, decorating allowances, club or golf memberships, cars, swimming pools, etc. to entice them to buy today. While freebies cost money, they do draw attention, which may be just to ticket in getting your home noticed.
5. Overcome an Objection or Problem:
While it may be impossible to solve all problems or objections permanently, offering to buy your way out of a few of them may help you sell your home. For example, if parking is a problem, offer a year of free parking for the new homeowner. If your homeowner association dues are high or if special assessments are blocking your sale, eliminate the problem by paying the dues yourself for a time or split the assessment costs. If your home is dated or in need of repairs, give the buyer an allowance for home improvements that they can make after they move in. If your area is suffering from insurance shock, offer to reimburse the first year premium. When marketing a home, buying your way out of trouble can often times help you more than reducing your sales price by the same amount of money.
6. Last Ditch Effort—Offer a Bonus to the Broker who brings you the Buyer.
While I personally hate this option, consider offering a bonus to any agent who gets a buyer to the closing table. It is not a secret that sales people are money motivated, like most of us. Offer the broker more money to sell your home, than he could earn by selling someone else’s, and see for yourself which home sells first.