Sunday, April 16, 2006

Advice to Buyers: Concessions

I've communicated with a number of Marin realtors who visit this blog and they have told me about the concessions that some Marin sellers are having to cough up to attract buyers. You know, things like cash back, paying closing costs, pay X amount of the insurance for Y number of years, etc. Even ZipRealty pays out some small fraction of the selling price if you buy through them.

But it seems to me that these concessions are rather empty come-ons. A buyer would be far better off, in my opinion, reducing the sale price by at least whatever those concessions add up to. You are better off because your property tax is fixed based on the sales price. If the seller is really desperate, then push for some concessions to sweeten the deal.

So buyers: don't fall for these concessions. Press for what really matters.


Anonymous Anonymous said...

In addition to concessions, my advice to buyers is to require a little "seller groveling". Yup, I think it's time for buyers to become a bit more demanding of their sellers, and not just with price concessions and perks. After all, what goes around, should come around. Don't you think ?

So, I say, before buyers begin to prepare any type of a (low, low) offer (if at all), all buyers should ask for a recent family portrait and family history of the seller. The family history should be "presented" to buyer by the selling agent at the buyer's home after their Sunday dinner; sort of like family entertainment. Buyers should also require the seller to write them a poem exposing how wonderfully qualified they are to live in their (the seller's) home and how fortunate the seller's feel to just to have the privilege of doing business and getting to know the buyer. After all, who’s forking out the money here ?

Yes, I think these things would be nice. In fact, this is the kind stuff that they should be teaching in those rigorous real estate prep-schools, as I suspect we'll be seeing more and more of these types of concessions in the near future.

And, after the seller has met these buyer requirements, buyers should seriously consider making their (low, low) offer contingent on the seller coming back to the house each week for the next two years to feed the squirrels, birds or the neighborhood cat. Yup, that would be nice too.

So, if you ignore my "don't buy" advice, then my advice to any potential buyers is squeeze the heck out of and have a little extra fun with your sellers. After all, what goes around, should eventually come around.

Apr 16, 2006, 7:40:00 PM  
Blogger Marinite said...

anon 7:40 -

Um, is that supposed to be sarcasm or what?

Apr 16, 2006, 8:23:00 PM  
Anonymous Anonymous said...

Well, yes, sort of.. I've read and experienced some of these little treats from the buyer's perspective the past few years and it grated on me to no end...

Apr 17, 2006, 7:17:00 AM  
Anonymous Anonymous said...

The only REAL concession that a buyer should demand is the one that Marinite alluded to in a posting last week:

They should ask that the house be sold at the same price that the seller bought it.

Why? Because one really shouldn't be allowed to make money from selling a home. It's immoral.

Apr 17, 2006, 7:24:00 AM  
Anonymous Anonymous said...

just ask for a purple navigator,with dreamcatcher and a life membership in earthfirst...maybe a signed first edition of julia butterfly hills book too,if you are going marin baby,go for all the tofu!!!

Apr 17, 2006, 9:43:00 AM  
Blogger peterbob said...

A buyer would be far better off, in my opinion, reducing the sale price by at least whatever those concessions add up to...So buyers: don't fall for these concessions. Press for what really matters.

Right on. $20K in concessions is worth FAR less than $20K in a price reduction. Think about it. Not everyone values closing costs or granite countertops, etc. the same. So what is worth $20K to the seller is usually NOT worth $20K to the buyer (that is, of course, $20K off the selling price).

So sellers, get a clue. Reduce your price if you want to move your house.

Apr 17, 2006, 11:35:00 AM  
Anonymous Anonymous said...

They should ask that the house be sold at the same price that the seller bought it.

Really? Is this serious or are you a socialist?

Raise your hands everyone on this blog who has sold at least one home and did so at the same price they paid for it.

Or even sold at substantially (i.e. 25% or more) below market.

I hear crickets....

Absolutely no sane person, no matter how badly they feel about how expensive it is here would do that.

If somebody has out of kindness or sympathy for the buyer's plight, please share your story. Dying to hear it.

You think CA's crumbling infrastructure is bad now, think how much worse it would be if this rule were instituted (Or how astronomical the property tax rate would be to compensate).

My parents bought here in 1971 for $41k -- that wouldn't buy you a moderately pimped out Suburban nowadays.

Apr 17, 2006, 6:37:00 PM  
Anonymous Anonymous said...

This comment has been removed by a blog administrator.

Apr 17, 2006, 11:35:00 PM  
Blogger Marinite said...

rejunkie -

I have to agree with you on th is one for sure. In general, selling a house for the same price that you bought it is a bad idea (doesn't France do something along these lines?). You at least thave to adjust for inflation and improvements.

Apr 18, 2006, 9:38:00 AM  
Anonymous Anonymous said...

FORGET about concessions. Just lower the price. Buyers are stupider than I thought if they fall for the consolation prize of a concession.

Cold hard cash is what matters.

Apr 18, 2006, 6:47:00 PM  

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