Seller Concessions : Is it Bad to Demand ?

Closing Cost Covered

Seller's Point of View:

Last February, we listed our house in Real Estate market. After de-cluttering and staging done, we took the time in discussing with our listing agent about the comparable price in our neighborhood. We compare and look at the sq footage of the house, size of the garage, location of the property, condition of the property, number of bedrooms and bathrooms and so on. After the discussion, we set the price. Our listing agent has helped us come up with a reasonable price of the property.

 

We also discussed that we wanted the full price as much as possible. Seller concessions are negotiable. Our thoughts were, the lesser demands from the buyer most likely the favorable offer.

 

Four days passed, we have three offers. One offer asked for full closing cost covered by the seller, our response was flat NO and we didn't bother to counter their offer because we have multiple offers on the table.

 

The second offer has a lowball offer and asked for 30% closing cost and the closing date was in two weeks. Tempting. We end up saying NO because the buyer asks for an X amount of Home Warranty too and an X amount of home repair. If the buyer was a cash buyer, we could counter offer but, he was not. Dealing with mortgage folks can be dragging.

 

We accepted the full priced offer with no seller concessions. Their only request was 60 days closing. We were not in a hurry so; the offer was good enough.

Buyer's Point of View:

We were looking for a new property to buy since the house was sold. We found a great property in a beautiful neighborhood, and the price of the property was at the max of our budget. Asking for seller concessions left us with no option knowing that there are 6 offers on their table already. We offer full price, cash offer and closing date in 30 days.

After one day, our realtor asked if we want to go a higher bid. We said NO. As a buyer, we should know the max amount that we can afford to pay. Was our offer good enough? We don't know. We were in limbo.

After two days, our realtor congratulate us. We got the house.

Is it bad to demand a seller concession? It could be Yes and No. It all depends. Is your demand reasonable? How many offers on the seller's table? If there's a multiple offer, asking for seller concession is risky but, you can try. Make a strong offer that the seller will favor you from others. Good luck!

Home Inspection and Real Estate Appraisal

Sellers Point of View:

The moment home owners decide to list their property in real estate market, inspection as well as home appraisal requests are expected. Sellers dreaded inspection and home appraisal especially if the property is old and has a lot of problems. Their apprehension is high when they encountered problems while living in it and did not do anything about it.

Ancestral houses are money pit especially when there is a termite, structural, electrical and plumbing problems. If the square footage is huge and the owner lack the financial aspect to renovate and fix the problem, the value of the property is not favorable even if it is located in a great neighborhood. Someone might buy the property as a fixer-upper so; the buyer will offer way low of the asking price.

In some cases, if there are multiple offers, sellers will be lucky to get the asking price. If the property is sold then come the home inspection and the home appraisal. If they accepted a cash buyer, it will be easy to negotiate than someone who is not. The bank of the home loan buyers will definitely ask for home appraisal. When the appraised value is available, seller has no control over it. Seller usually stick to the asking price regardless of the appraised value.

Home Buyers Point of View:

Finding a property that has the charm and potential can be the home buyer's delight. Home buyer loves to find a property that is in a great neighborhood, appealing lay-out, huge square footage, big backyard and with in their price range.

Cosmetic fixes are inexpensive so; a fixer-upper or foreclosure is an ideal property to buy. There is a need for buyers to request a home inspection and if possible a home appraisal to make sure that the purchase is worth the money they are paying for.

If the appraised value is low then, the bank could only loan the money equal to the appraised value. The buyer can either stick to the contract and put up the extra money or walk away.