Thursday, September 24, 2009

Letting the Sour Housing Market Work for You

With mortgage rates inching higher every month and the doom and gloom from the experts predicting the real estate market bubble is about to burst, just about everyone is staying away from buying new homes, at least until everyone can figure out if this recession has any legs or not.

So, what reason does anyone have to buy sooner rather than later?


According to the National Association of Home Buyers, somewhere around 75 percent of builders are offering incentives right now.

A recent CNN-Money article documented this curious trend in the housing market, as things get tighter, realtors and home builders are looking for any possible enticement to get people to buy now.

For instance:

No Closing Costs
No payments for six months (Yes, on your house, this isn’t a car ad).
$10,000 towards an in-ground pool
Upgraded appliances
Free expert landscaping
Plasma TVs
$5,000 gift certificates to upgrade your home.
New Cabinets
New Countertops (granite, of course)
Marble baths
Price cuts up to 6 percent
Price cuts of 10 percent or more on new homes
Lower mortgage rates

And those are just the incentives offered from realtors and builders. If you’re looking to buy direct without the aid of a realtor, you can still get in on the incentive deals. One couple in Colorado is offering round-trip airfare to any destination in Europe, or an expensive bottle of wine to anyone who will buy their condo.

Other offers in the same area included a month of professional massages or the use of a personal chef for a period of time.

Brokers across the country are reporting similarly strange behaviour, like sellers willing to give a 20 percent discount to anyone who bought by a certain date. Or others offering merchandize, like a Vespa scooter or plane tickets to anywhere in the US if their house was bought quickly.

One unique buyer in Rhode Island was actually offering a Lexus automobile with his property.

While it’s unknown if this trend will continue, these incentives are helping to move properties that might not other wise sell as quickly. Take it as a sign of desperation or a sign of sillyness, but as long as the housing market across the United States shows signs of slowing, incentives, big and small, serious and bizarre are here to stay.

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