Here are the current market conditions for 85388 as of 11/22/2011:
Active Homes For Sale: 106
Homes Under Contract: 174
SOLD in Previous 30 days: 69
Absorption Rate: 1.53 MONTHS
This means that the current inventory level will be SOLD within 6 weeks, ONLY if every home is a desirable home. There are 3 types of markets based on SUPPLY or INVENTORY levels:
0-3 Months SELLER'S MARKET (Seller sets price and conditions, prices increase)
4-6 Months BALANCED MARKET (Negotiations are possible, prices remain steady)
7+ Months BUYER'S MARKET (Buyers are in control, prices fall)
The media is not reporting: "WE HAVE A HOUSING SHORTAGE IN THE PHOENIX AREA". Our inventory levels are down, the banks are holding some foreclosed homes and releasing them VERY SLOWLY, keeping our inventory levels below 3 months and therefore buyers are having a hard time obtaining a home. In addition more home owners are getting modifications and our foreclosed home level has dropped significantly.
Your agent matters...
REALTOR Since 1997
Best of luck.
First of all it has nothing to do with a new or used home, the concept is the same. Having the seller contribute to your closing costs is a good thing. It lowers your out of pocket and allows you to make the seller pay for your costs. The price that you offer though will need to be increased by the amount of the closing costs to offset the discount. In a tight market where others are offering asking price or higher, you will need to be even more competitive in your offer. I always advise my buyers to ask for it and just bump up the offer amount by that amount. Example, if you want a $100,000 home and want to offer $100,000. You would offer $103,000 with $3,000 coming back in closing costs. This does not work well in a declining market as there are appraisal issues. So to answer your question, it is beneficial for some buyers to have their closing costs paid for by the seller, if they are trying to keep their out of pocket lower. Essentially, you are financing the amount you are asking for back in seller concessions. Hope this helps.
Deferring closing costs is the same as requesting a price reduction. In a competitive market, your terms and conditions must more than compensate for this provision, but, you need to start the conversation somewhere. Just don't wait too long.
First, I hope you have a great agent working on your behalf. We can give you general answers, but there are always details a good agent picks up that may cause them to recommend a different approach.
In general, any offer with closing costs is no different than an offer with an equivalent discount. To the seller an offer of $300,000 with $5000 in buyers closing costs is the same as an offer of $295,000. The exception is when a seller is hung up on their "number" but it really doesn't matter.
A good agent working on your behalf will talk to the sellers agent and try to uncover issues that are important to the seller. This may be price, closing date, vendors for Title & Escrow, fixtures that they may want to take with them. Giving the seller as much of the non-cost items they want or need increases the chance they will consider your price, even if its less than they want.
If you need closing costs, ask for them, but just remember a $5000 discount and $5000 in closing costs are the same as a $10,000 discount to the seller.