Homebuyer incentives can be smart marketing or a waste of money. Â Find out when and how to use them.
When youâ€™re selling your home, the idea of adding a sweetener to the transactionâ€”whether itâ€™s a decorating allowance, a home warranty, or a big-screen TVâ€”can be a smart use of marketing funds. To ensure itâ€™s not a big waste, follow these dos and donâ€™ts:
- Do use homebuyer incentives to set your home apart from close competition.Â If all the sale properties in your neighborhood have the same patio, furnishing yours with a luxury patio set and stainless steel BBQ that stay with the buyers will make your home stand out.
- Do compensate for flaws with a homebuyer incentive.Â If your kitchen sports outdated floral wallpaper, a $3,000 decorating allowance may help buyers cope. If your furnace is aging, a home warranty may remove the buyersâ€™ concern that theyâ€™ll have to pay thousands of dollars to replace it right after the closing.
- Donâ€™t assume homebuyer incentives are legal.Â Your state may ban homebuyer incentives, or its laws may be maddeningly confusing about when the practice is legal and not. Check with your real estate agent and attorney before you offer a homebuyer incentive.
- Donâ€™t think buyers wonâ€™t see the motivation behind a homebuyer incentive.Â Offering a homebuyer incentive may make you seem desperate. That may lead suspicious buyers to wonder what hidden flaws exist in your home that would force you to throw a freebie at them to get it sold. It could also lead buyers to factor in your apparent anxiety and make a lowball offer.
- Donâ€™t use a homebuyer incentive to mask a too-high price.Â A buyer may think your expensive homebuyer incentiveâ€”like a high-end TV or a luxury carâ€”is a gimmick to avoid lowering your sale price. Many top real estate agents will tell you to list your home at a more competitive price instead of offering a homebuyer incentive. A property thatâ€™s priced a hair below its true value will attract not only buyers but also buyersâ€™ agents, whoâ€™llÂ be giddy to show their clients a home thatâ€™s a good value and will sell quickly.
If youâ€™re convinced a homebuyer incentive will do the trick, choose one that adds value or neutralizes a flaw in your home. Addressing buyersâ€™ concerns about your home will always be more effective than offering buyers an expensive toy.
HouseLogic article byÂ G. M. FiliskoÂ 09.01.10Â http://bit.ly/brAXgC