What are the current market practices for sellers helping buyers with closing costs in the Birdsboro area?

Asked by Kelly B., Mohnton, PA Sat Jul 31, 2010

Is it more common now for the seller to help with closing costs in this current market? How much help with closing costs is normal? Also, this is a different question, but have the market values of homes in Birdsboro gone up or down in the last year, and if so, by how much, and why? Thanks!

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3
Alan J. Rieg…, Agent, Audubon, NJ
Fri Aug 20, 2010
Hello Kelly:

Sellers have offered concessions/credits or seller assist amounts to buyers on 16 of the 26 closings in Birdsboro Borough on TReNDmls over the past 6 months(February 20, 2010 - August 20, 2010.) That is approximately 61.54% of the Settlements (or a little more than 3 out of every 5 sales) actually had some sort of concession (other than a price reduction) during that time.

Many of those seller concessions were in the range near 6% of the sale price with FHA purchase loans. I'll be watching for changes in future sales activity as FHA rules change and those maximum seller assist amounts are reduced.

No doubt, a buyer can benefit from using seller assist funds to reduce their out of pocket up front closing costs. A wise seller will work with their agent to prepare for the possibility of a buyer asking for an assist. In some cases, offeing a possible assist may attract buyers to the listing.

Thanks for asking,
0 votes
Valerie Mack…, Agent, Wyomissing, PA
Sun Aug 1, 2010
Kelly:

As regards sellers helping buyers with closing costs, I'd have to say that 90% of the time buyers request help with closing costs - it is the norm these days for closing costs to be one of the inclusions in an Agreement of Sale - and I would say that normally the seller does help the buyer with some closing costs (a buyer's general closing costs on a $200,000 house, for example, with an FHA loan at 5% interest rate and 3.5% downpayment, would approximate more than $18,700, and many buyers wouldn't be able to get to the settlement table without some assistance from the seller.)

However, conventional lenders will only allow 3% sellers assistance, and coming soon, FHA will also be reducing their maximum allowed sellers assistance down to 3%, so fairly soon the most a seller will be ABLE to assist a buyer will be to the tune of 3% of the agreed-upon sales price.

Regarding market values of home in Birdsboro, according to the year-over-year statistics tracked by the Multiple Listing System, the Birdsboro average sales price increased in the past year by 12.31% and home sales increased by 10./53% over last years sales, as well. Average days on market (the length of time a house spent on the market before going under contract) was 166 days, which is pretty long - but it does look as if Birdsboro's home values are pretty stable.

If you'd like more information on the current real estate market in your area, or would like to get an idea of what your specific home might fetch on the market, please feel free to give me a call at 610-207-0172 or drop me an e-mail, and I would be happy to help.
0 votes
Sharon Sapp, Agent, Reading, PA
Sun Aug 1, 2010
Kelly, every deal is as individual as the
buyer and sellers are. The mortgage
company first determines if seller assist
Is needed. Typically it is 3 to 6% but
It's changing to a maximum of 3%
for FHA loans. Sometimes the negotiations
result in credits for the buyer at aettlement.
There is no
Web Reference:  http://YourRealtor4Pa.com
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