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Seattle Real Estate Blog

Are home buyer incentives a win-win or just a distraction?

With the real estate market starting to show some signs of slowing down, some home sellers are starting to offer incentives to home buyers to encourage them to buy their homes.

Are home buyer incentives a win-win

First time home buyer incentives and home buyer incentives in general, can be tempting. However, buyers should be asking themselves.

  1. Why is the seller offering that incentive in the first place?
  2. What exactly IS the incentive and are there restrictions as to whether I get the incentive or not?
  3. If I accept the incentive, what might I be giving up instead?

Well, the answer is sometimes incentives really are a win-win for the buyer but sometimes it's just a distraction from something else.

Why do sellers offer homebuyer incentives?

The short answer is that sellers don't offer them when they know the home will sell quickly. 

If the seller and their agent think that the home might struggle to sell, then they will consider the option of dangling some incentive in front of the buyers to make the purchase more enticing and grease the wheels of industry towards a closing.

Examples of homebuyer incentives.

The are lots of different home buyer incentives and the type of offer might depend on whether the home is a resale by a homeowner or if the home is brand new construction and the seller is a builder/developer.

Work with the builder's lender for a discount.

Many builders require that homebuyers get pre-approved by the builder's preferred lender, even if the buyer has been pre-approved with their own lender already.  Also, some builder's lenders will offer some incentives like $3,000 paid towards the buyer's...

My prediction for the 2019 Seattle real estate market

What will the Seattle real estate market do in 2019?

My guess is as good anyone else I suppose, so I might as well have a crack at it.

I'm only predicting what the median sale price will do over the course of 2019. And home prices are what homeowners, sellers, buyers (and Realtors) usually obsess over the most.

I will revisit my prediction every quarter to see if I end up being anywhere near what actually transpires over the year.

Few people foresaw the way the market turned on a dime last spring and I definitely wasn't one of them. So with that in mind...

Here's my 2019 prediction: The Seattle and Eastside median price will increase by 4 to 6% between now and spring / early summer and then drop back down to current levels by the end of the year.

Seattle real estate market prediction for 2019

Why I think Seattle home prices are going to go back up:

  • Prices peaked in May at $802,000 and fell to $713,000 by January, a drop of 9%. 
  • This price drop is likely going to attract more buyers back into the market who gave up last spring when the market was in manic mode and buyers were constantly getting into bidding wars and forced to pay well over list price to get a home. Buyers got fed up being manipulated by the housing market and just stepped back en mass. Now they are seeing homes taking longer to sell, price drops and sales contingent on inspections.
  • Prices have finally hit the Conor Trend Support Line drawn (manually) under the lower prices of the upward trend. I predict that prices will bounce back up off that support price.
  • Prices will finally break BELOW the trend line by the end of 2019.
  • We are coming out of the winter/holiday hibernation season and will soon...