If your agents says yes, I would assume they know the market and know what they are talking about. If you do not have a contract yet, and need to include closing costs because of the down payment you have, you will have to increase the purchase price of $205,000.
I will show you how this can benefit you. Let's say you want to put 3.5% down, and will have $6,000 closing costs. Keep in mind, I am only making up the closing cost number. If you don't increase the price and take the seller's concession, you would need $7175, plus the $6,000 closing costs, or $13,175. If you increased the price to $211,000, had the seller pay $6000 towards closing costs, you would only need a total of $7375.
Now, please don't all of you rush in and tell me that I didn't include the up-front MIP. I was just doing this for illustration purposes to show it to Yani as simply as possible. Yani, with my example, you come to the table with less money, and the seller gets the amount they want. The other key factor however is that the house has to appraise for the $211,000.