Kenna Real Estate Group · Colorado sellers
A home that is sitting is missing the buyer's payment, not the buyer. Offer the buydown before the price cut: same money at closing, five times the effect on the payment, and the comps stay whole.
A live person answers. Not a robot, not a phone tree.
$11,200 off the price lowers a buyer's payment about $74 a month. The same $11,200 as a 2-1 buydown lowers it $616 a month in year one, and it costs you the same at closing. Sellers who priced right and offered a credit this year netted about 98 percent of list; sellers who held out and cut late netted about 93 percent. The strategy: announce the buydown in the listing, market the payment instead of the price, and reserve the price cut for a home that is not getting showings at all.
The credit
$10,000 to $15,000
About 2.3 percent of the loan funds a full 2-1 buydown.
The buyer sees
$616 a month
On a $480,000 loan at a 7 percent note rate.
Your net
98%
Versus about 93 percent after a late price cut.
Timing
Day 14 to 30
That is the payment problem; the credit fixes it.
| Hold at $600,000 | Cut 3% to $582,000 | $600,000 with a $10,000 credit | |
|---|---|---|---|
| Sale price | $600,000 | $582,000 | $600,000 |
| Commission (5%) | $30,000 | $29,100 | $30,000 |
| Title and closing | $3,500 | $3,500 | $3,500 |
| Credit to buyer | $0 | $0 | $10,000 |
| Payoff | $310,000 | $310,000 | $310,000 |
| Net to you | $256,500 | $239,400 | $246,500 |
| Buyer's payment change | none | about $120 a month | about $616 a month, year one |
| The next comp shows | $600,000 | $582,000 | $600,000 |
The seven buyers still moving at 7 percent: the household that needs another room, the relocating buyer with a start date, the buyer who wants one level, the buyer moving near a parent, the fresh start after a divorce, the move-up buyer with equity and the cash buyer who would rather keep some cash. Six of the seven are payment-limited; the buydown speaks to them directly.
kennarealestate.com · free guide
Your net at list, at a 3 percent cut and with a $10,000 credit, side by side, plus the listing wording and the buyer-loan caps
A credit is a targeted price cut: the same money at closing, a much bigger change to the buyer's payment. Sellers who priced right and offered a credit netted about 98% of list; those who held out and cut late netted about 93%.
Prepared by
KENNA REAL ESTATE GROUP
Call or text 303-955-4220 · A live person answers.
The credit lands on the buyer’s closing statement first. What it covers, line by line: closing costs for Colorado buyers.
Text your address to 303-955-4220. A live person sends the net sheet three ways and the listing wording within one business day.
Call or text 303-955-4220What is my home worth?The seller offers a credit, announced in the listing, that funds a temporary or permanent rate buydown for the buyer. It changes the buyer's payment far more than a price cut of the same size and keeps the list price and the comps intact.
About 2.3 percent of the loan amount: roughly $11,200 on a $480,000 loan, paid at closing out of proceeds. Same money as an $11,200 price cut, five to eight times the effect on the buyer's year-one payment.
By the amount of the credit, the same as a cut. Sellers who priced right and credited this year netted about 98 percent of list; sellers who cut late netted about 93 percent.
When the home is not getting showings. Buyers see the price before the payment; a cut that crosses a search band brings the showings, then the credit converts them.