Agents: 120+ Days on Market. Another Price Reduction—or Different Terms?

Question

I keep seeing properties sitting on the market for 90, 120, sometimes 180+ days. And the conversation often goes straight to another price reduction.

Sometimes price is the obstacle. Other times, the buyer simply can't make the financing work under the current terms.

What if the seller could carry a portion of the purchase price, allowing a qualified buyer to structure an offer that otherwise wouldn't work? I'm talking about partial seller financing, potentially in second position behind the buyer's acquisition lender.

When the numbers work and the lender permits it, the possibilities are interesting:

• The seller may preserve more of their asking price while earning interest.
• The buyer may preserve capital for renovations, reserves, or other investments.
• The lender gets an opportunity to finance a transaction that might otherwise never close.
• And the agent? Another potential closing instead of another price reduction.

The seller may preserve more of their asking price while earning interest.

The buyer may preserve capital for renovations, reserves, or other investments.

The lender gets an opportunity to finance a transaction that might otherwise never close.

And the agent? Another potential closing instead of another price reduction.

I'd bet there are lenders in this community willing to at least explore these structures when the transaction makes sense...

Deals require us to think outside of the box and get a little creative. Terms CAN be favorable for all parties.

Agents: When was the last time you presented a partial seller-carry option to a seller whose property wasn't moving? How did they respond?

Lenders: Are you seeing programs that accommodate seller-held seconds, or is this still a hard no in most situations?

I'd love to hear from people actually putting these deals together.

Divin Kanyama · Answer

@Quetzaly Torres Seller financing can absolutely help move a stale listing, but it works best when the issue is deal structure—not an unrealistic price or a property problem the market has already identified.

A partial seller carry may preserve price and help the buyer conserve cash, but the senior lender must approve it and include the payment in underwriting. The seller also needs to understand that a second-position note carries real risk if the buyer defaults or the property value falls.

I’d want the terms clearly documented: interest rate, payment schedule, maturity or balloon date, lien position, late-payment remedies, transfer restrictions, and what happens after a senior-lender default. Both sides should use experienced legal and tax advisers, and the seller should underwrite the buyer rather than relying only on the first lender’s approval.

For a property with long market time, I’d compare three options side by side: a clean price reduction, seller financing at the current price, and a combination of both. The best structure is the one that improves marketability without hiding the true economics or shifting more risk than either party understands.

Ametria Chaney · Answer

Quetzaly, at 120+ days I'd diagnose before prescribing. If showings are steady but no offers, it's price — the market has spoken and another reduction is honest advice. If showings have dried up, it's price AND presentation — stale listings get mentally filtered out, so a meaningful reset (not a 1% nibble) plus fresh photos, and sometimes a brief off-market pause before relisting, works better than death by a thousand cuts. Terms can help at the margins: seller concessions or a rate buydown can move a payment-sensitive buyer when the price is close but not quite. Pull the showing feedback first — buyers usually told you the answer weeks ago. What's the feedback saying on yours?

Marcus Auerbach · Answer

You only have 3 dials to adjust: presentation, condition and price. Sometimes the presentation is off, that's an easy fix. Sometimes it's the condition: house smells like cigarette smoke? Fix that. But more often than not, those are both fine and it actually comes down to price.

If a house comops at 500k, but does not sell at 500k and buyer feedback is consistently that the layout sucks, you can change the layout. But it might be cheaper to drop the price to 450k.

When I was new and my personal residence did not sell in a year I went down the terms rabbit hole and ultimately regretted it (leased option to an attorney with bad credit - nightmare).

Today I am looking back at over 500 homes sold: yes, most of the time it is in fact the price.

Quetzaly Torres · Answer

@Marcus Auerbach 500+ homes sold! You've certainly seen a few market cycles and probably more than your share of deals that didn't go as planned.

Would appreciate learning more about your lease-option experience. Was the biggest issue the buyer's inability to perform, the way the agreement was structured, or something else entirely?

I agree that price is often the deciding factor. But I'd argue there's a fourth dial: financing terms. Two comparable properties at the same price can produce very different buyer responses depending on how the acquisition is financed. And I think buyer qualification is a big part of this conversation. Creative financing shouldn't mean lowering the standards for who can afford a property. The buyer's income, financial readiness, and ability to perform still matter, regardless of how the deal is structured.

I also believe a significant amount of the risk associated with creative terms can be mitigated through proper legal documentation prepared by an experienced real estate attorney, with clear protections and remedies for both parties. Of course, no amount of paperwork can make an unqualified buyer financially capable of performing...that's a different story. But legal remedies can help reduce the fallout when life happens.

Given your experience on both the sales and investment sides, have you found that alternative terms rarely make a difference, or is it more that the additional risk and complexity haven't been worth it?

I'd genuinely be interested in hearing what went wrong with that lease option. Sometimes those lessons are more valuable than the success stories.

Marcus Auerbach · Answer

This was almost 15 years ago; he was an attorney and she was a real estate investor with a medical background, I believe 24/7 care facilities. Showed up in two black Mercedeses, both power dressed and talked a very good game. Explained they were in the process of separating, even though it was obvious to me they had a lot of chemistry.

My house had been on the market for almost a year at that point - and I was motivated! When I ran a background check on her, we found a lot of unpaid bills, medical bills and other stuff, some collections. But all relatively small amounts, many under $100, some a little more, but nothing major. I got a response worthy a court room argument: it was a rough patch of their marriage and the new real estate investments - she was just overwhelmed for a while. And that's the reason she is moving into her own home, this will fix the issue. They were convincing enough (and I was desperate and inexperienced enough) that we decided to move forward.

After 4 months she decided the house was too big for her to keep up (apparently she felt overwhelmed - what a surprise!) she wanted to cancel the lease and of course the option. We had a heck of a time untangling the contract, this could have easily gone to court. I got the house back, which was in brand new mint condition when she moved in and was now dirty on literally every surface, doors and trim had nicks, carpet some stains etc - it smelled. The biggest damage was a white ring on the black quartz countertops - apparently from an hot iron skillet.

Should i have gone after her for a 12k countertop? Probably. But I did not want to have a lawsuit with an attorney on my hands. I kept the option money and sold the house a few months later for a 100k less. Glad it was done and I could move on with my life..

If someone can't qualify for conventional financing, there is a reason. The US makes it pretty easy to buy a home: 5% down and a history of actually paying your bills is enough. That bar is pretty low.

I understand why you believe the is a fourth dial with financing; the argument makes sense in theory. MLS does even have a form field for seller terms, our WI Offer To Purchase has an entire pre-printed paragraph. But it remains an absolute outlier in residential real estate; I have actually never seen in done outside of my own deal above.

It breaks in the marketing funnel: 10,000 people see your listing online, 10 like it enough to schedule a showing. Among that 10,000 people will be a few that would be a good fit for financing terms, but the odds that they are also part of the 10 who like your house are tiny.

And even if that lines up, good luck convincing a residential seller (and their spouse) that a carry back is a good idea. That's another 1 out of 100. The odds that all 3 overlap are getting microscopic.

Commercial real estate is a very different story; investor to investor, apartment buildings etc - you can absolutely work it this way.

Matthew Morrow · Answer

@Quetzaly Torres we talk about this with sellers pretty often. When a listing's been sitting, another price cut isn't the only lever, and getting creative with terms should be part of the conversation. Worst they can say is no. It does take the right seller, a buyer's lender who'll allow the second, and an attorney on both sides who understands the structure. Good topic to bring up.

Shannon Williams · Answer

I think if I was trying to pitch this to a seller I would keep it pretty basic at first.

Let them know that maybe we can make the purchase more workable for the buyer instead of just dropping the price more. I would want to let them know what they are getting into and how much of the purchase price they would still be carrying. I’d also explain the risk of being in second position.

Once we have the buyer’s lender on board, we could make sure this is even possible and then go from there. Have the attorneys and lender work out the details.

Matthew Morrow · Answer

@Quetzaly Torres after 120 days, I'd go back to why it's sitting before cutting again. If buyers walk through and pass, it's usually price or condition. If nobody's coming, look at marketing and photos. Terms can help when financing is what's holding buyers back, like a seller credit toward the rate or closing costs, but only if the price is already in range. And with appraisals coming in light right now, a contract above the comps can fall apart later anyway. Let us know what you decide.

Quetzaly Torres · Answer

@Matthew Morrow the appraisal issue is a good point. Financing terms aren't going to magically justify a price that the comps don't support.

But I'm curious whether you're seeing a distinction between owner-occupant buyers and investors when listings sit for extended periods.

Here's a real example. I was recently evaluating a property in Jacksonville, FL, where the numbers were already pretty tight. The last investor I presented it to passed because she needed at least $800 in monthly cash flow to justify the risk. This illustrates something I keep encountering: an investor may recognize a property's potential but still walk away because the financing structure leaves too little cash flow or capital for improvements and unexpected expenses.

And here's the kicker - just yesterday, I learned the property actually has TWO septic tanks, not one as the seller originally claimed, and both reportedly need replacing!

So yes, condition absolutely matters. But financing terms can also make the difference between a viable investment and one that simply doesn't meet an investor's criteria.

Have you encountered similar situations where investors passed primarily because the financing made the numbers too tight? And have you explored alternative terms with sellers before recommending another price reduction?

Quetzaly Torres · Answer

@Divin Kanyama I think comparing those three scenarios side by side is exactly the right approach.

And I'd add another consideration: what does the seller actually want to accomplish financially? This is key.

Some sellers need immediate liquidity. Others may be more interested in collecting interest on their equity, generating monthly income, or potentially spreading eligible capital gains over time. That's where I think the conversation becomes more interesting than simply reducing the price. A lower purchase price isn't necessarily the best financial outcome for every seller. Of course, the risk has to be priced appropriately, especially in second position.

From your perspective as an accountant, have you found that sellers become more receptive to financing part of the sale once they understand the potential tax implications of receiving a large lump sum versus installment payments?

Agents: 120+ Days on Market. Another Price Reduction—or Different Terms?

Agents: 120+ Days on Market. Another Price Reduction—or Different Terms?

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