How common are concessions in the current market?

Question

I've lost several bids on single family homes recently.  I'm wondering  if it is because we are asking the seller for closing costs.  Are buyers still successfully getting sellers to pay closing costs in the salt lake valley or is that practice dying out?

Henry Lazerow · Answer

In Chicago we ask for a closing cost credit nearly 100% of the time with 2-4 units. But we go in $10k higher then what would of normally offered and then ask for a $10K seller closing cost credit so the seller still nets out the same.

The trick is you need to call list agent and explain to them what it is so they don't get confused. I also like to send a bank statement showing my client has more then the cash for downpayment in the bank so sellers agent knows they are a strong buyer and just doing this credit to maximize their % return.

Cherie Orellana · Answer

As Henry said the bottom line matters. In a multiple offer  situation people often still ask for closing cost but they go above whatever their offer Is.  Showing you are a strong buyer but prefer have your closing costs rolled into the loan as a seller paid concession is wise. I typically write a love letter when I send an offer telling  about my buyer. Occasionally I also use an escalation clause.

Eric M. · Answer

I would guess that the overwhelming reason you lost several bids is because your bids were not the highest.

But if you are asking for closing costs and it is not common in your area to ask for closing costs or most other buyers are not asking for them, then it is possible the seller could misunderstand your offer and accept a lower one. Do what the local custom is and make it clear to the buyer what the net offer price is.

How common are concessions in the current market?

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