Incentive: noun; Something that incites or tends to incite action or greater effort as a reward.
If you've had your home on the market for a couple of months with very bites or nibbles you might be in quite a pickle. What if you've lowered your price as much as you can, just up to the point of making your sale a short sale? What if you've improved the curb appeal, cleaned the entire house, replaced all the appliances, painted, carpeted, or staged and the home still hasn't sold? If you're up against a wall, there are some incentives or perks to offer your buyers to make your home stand out from all the others.
1) Help With the HOA Dues
For most first-time home buyers, the "add-ons" of taxes, HOA's, insurance and all the other little things beyond just a simple mortgage payment can really add up. They're used to just paying just one simple rent check. They see all the extra numbers and wish they could go away for a while. What if you could help them manage that? A savvy agent will be able to craft an incentive that will help pay HOA dues for six, nine, or twelve months, or maybe even more. That way your buyers can ease into home ownership and you can stand out among other houses in your neighborhood.
2) Offer a Bonus to the Buyer's Broker
If you want to get people to come take a look at your home, you need to first convince agents that your home is worth taking a look at. If it is in the same condition, looks the same, and is similarly priced as your competition, how can you nearly guarantee that your home will be shown? Offer the buyer's realtor a bonus to sell the house. The bottom line is, realtors will always know what commission they can expect to sell a home but, if you offer a bonus, maybe they'll try a little bit harder to get yours sold. Depending on the size of value of your home, you could offer a $1000-$2000 bonus, they buyers may never even know!
3) Assist with Closing Costs
This is a more common incentive that helps folks with little to no down payment get into a home without needing a lot off extra cash to pay loan fees, escrow fees and mortgage insurance. Typically, beyond having to put money down to pay for the home, buyers also need to pay for all sorts of closing costs. As a rule of thumb, you could offer anywhere from $1000 to $5000 to help cover the closing costs of your buyers. The benefit to you is you get your home sold; the benefit to the buyer is they don't have to come up with all that cash at time of closing.
4) Help Pay Down Your Buyer's Interest Rate
If there is one cheap method to entice your buyers to save tens of thousands of dollars over the life of their loan, this is it. Offer to work with the buyer's lender to help pay down their interest rate. A few "points" (1 point = 1% of purchase price) added to the deal can get your home sold quickly, and will reduce your buyer's monthly payments. It also assures that no matter what they do, when they buy your house, they will get below market interest rates.
Hint: Hey buyers out there...If you're reading this, now you have a little ammunition when you're making your offers...you know what incentives you might be able to ask for!
As always, some of these incentives may or may not work for particular situations. If you're not sure you can always ask your savvy realtor. If you need one of those, I know one--he looks just like me and isn't my twin brother Jeff.