Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Desperate US home sellers are basically paying buyers to purchase their homes

Desperate US home sellers are basically paying buyers to purchase their homes

Sellers want to off-load properties so badly that they're paying down buyers' mortgage rates and offering money for repairs at record levels.

Sales of previously owned homes have fallen for 10 consecutive months. It's making some home sellers so desperate they're offering buyers cash to purchase their properties. 

It all comes down to the Federal Reserve's ongoing fight against surging inflation, which has effectively put an end to pandemic-era mortgage deals. With higher monthly mortgage payments and near-record-high home prices, fewer Americans are purchasing homes. And in a stark contrast to the housing market of 2020, sellers are losing their grip on the US real-estate market — and it's costing them big. 

Indeed, data from the real-estate brokerage Redfin indicated that in the fourth quarter of 2022, home sellers gave concessions — such as money for home repairs and mortgage-rate buydowns, a technique where a seller pays a fee at closing to secure a lower mortgage rate for a buyer — to buyers in 41.9% of home sales. 

That's the highest rate Redfin has ever recorded over a three-month period.

"Buyers are asking sellers for things that were unheard of during the past few years," Van Welborn, a Redfin real-estate agent based in Phoenix, said in the report. "They're feeling empowered, partly because their offer is often the only one, and partly because they know sellers have built up so much equity during the pandemic that they can afford to dole out sizable concessions."

With fewer deals taking place, home prices are falling in cities across the country — even in previously hot markets like Austin and Phoenix. It's causing some homeowners to do whatever they can to sell their homes quickly.


Buyers are seeing more discounts and reclaiming their power


Buyers are also receiving more price cuts. According to Redfin, a record 22% of home sales Redfin agents made in the fourth quarter of 2022 included both a concession and a final-sale deduction. Additionally, a record 19% included both a concession and a listing-price cut while the home was still on the market, and a record 11% included all three incentives.

Brian Lewis, a housing expert and broker with the real-estate firm Compass, said that in cities like Los Angeles and Chicago a, general lack of homes for sale is also helping shift the market in favor of buyers. 

"Here's the thing about America, we don't have inventory," Lewis said in an interview on Fox on Thursday. "In New York City, it's tight. In Richmond, Virginia, it's tight. In some areas of Chicago, it's tight. My Los Angeles offices are saying that it's tight out there, too." 

When home prices and mortgage rates are both high, buyers are reluctant to dive in. That means sellers need to compete for the few that are willing to make offers under such conditions. Lewis said these dynamics have made it unmistakable that "homebuyers have way more power" than sellers. 

"It took a while, but seller expectations are coming back down to earth," Welborn said. "Sellers realize they're not going to get $80,000 over the asking price like their neighbor did last year."

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
CEO Resigns Amid Controversy Over Relationship with HR Executive
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
Tulsi Gabbard Unveils Evidence Alleging Political Manipulation of Intelligence During Trump Administration
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Trump Announces Coca-Cola to Shift to Cane Sugar in U.S. Production
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Zelensky Reshuffles Cabinet to Win Support at Home and in Washington
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Church of England Removes 1991 Sexuality Guidelines from Clergy Selection
Superman Franchise Achieves Success with Latest Release
Hungary's Viktor Orban Rejects Agreements on Illegal Migration
Air India Pilot’s Mental Health Records Under Scrutiny
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
Moonshot AI Unveils Kimi K2: A New Open-Source AI Model
Martha Wells Says Humanity Still Far from True Artificial Intelligence
Nvidia Becomes World’s First Four‑Trillion‑Dollar Company Amid AI Boom
EU Delays Retaliatory Tariffs Amid New U.S. Threats on Imports
Trump Proposes Supplying Arms to Ukraine Through NATO Allies
US Opens First Rare Earth Mine in Over 70 Years in Wyoming
Bitcoin Reaches New Milestone of $116,000
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
×