Why Buyers Are More Likely To Get Concessions Right Now

In housing markets where inventory is increasing, both homebuilders and home sellers are offering valuable buyer incentives—such as paid closing costs, mortgage rate buy-downs, and other concessions—to make their real estate listings more attractive. These real estate incentives, often referred to as concessions, are designed to help buyers save money and encourage faster home sales in competitive markets.

What Are Concessions and Incentives?

When a seller or builder gives you something extra to help with your purchase, that’s called either a concession or an incentive.

• A concession is something a seller gives up or agrees to in order to reach a compromise and close a deal.
• An incentive, on the other hand, is a benefit a builder or seller advertises and offers up front to attract and encourage buyers.

Today, some of the most common ones are:

• Help with closing costs
• Mortgage rate buy-downs (to temporarily lower your rate)
• Discounts or price reductions
• Upgrades or appliances
• Home warranties
• Minor repairs

For buyers, getting any of these things thrown in can be a big deal – especially if you’re working with a tight budget. As the National Association of Realtors (NAR) says:

“. . . they can help reduce the upfront costs associated with purchasing a home.”

Builders Are Making It Easier To Buy

It’s not just one builder willing to toss in a few extras. A lot of builders are using this tactic lately. As Zonda says:

“Incentives continued to be popular in March, offered by builders on 56% of to-be-built homes and 74% of quick move-in (QMI) homes, which can likely be occupied within 90 days.”

That’s because they don’t want to sit on inventory for too long. They want it to sell. And according to the National Association of Home Builders (NAHB), one of the strategies many builders are using to keep that inventory moving (and not just sitting) is a price adjustment (see graph below):

Approximately 30% of home builders reduced new home prices during each of the first four months of the year, signaling a growing trend in the real estate market. While the majority of builders are maintaining current pricing, this data highlights that many are open to price negotiations and buyer incentives to close deals—making it a prime opportunity for homebuyers looking for discounts on new construction homes.

This isn’t a sign of a housing market downturn—it’s a strategic opportunity for homebuyers. With most home builders now offering buyer incentives and around 30% reducing new home prices, purchasing a newly built home is more affordable than ever. If you’re in the market for new construction, chances are your builder is willing to negotiate or provide concessions to help you close the deal and save money.

Existing Home Sellers Are Offering More, Too

More existing homes (one that someone has lived in before) have been hitting the market, too – which means sellers are facing more competition. That’s why over 44% of sellers of existing homes gave concessions to buyers in March (see graph below):

Looking back at pre-pandemic real estate trends, the current rate of 44% of home sellers offering concessions shows the housing market is returning to a more balanced state. After several years of a strong seller’s market, today’s conditions are shifting in favor of buyers. This increase in seller concessions—such as help with closing costs or home repairs—means buyers now have more negotiating power and better opportunities to save on home purchases.

Keep in mind, real estate concessions don’t always mean a major price drop. While more home sellers are adjusting prices, many offer valuable incentives in other ways—such as covering repair costs, including appliances, or paying a portion of your closing costs. These homebuyer concessions can significantly reduce out-of-pocket expenses, making it easier and more affordable to purchase a home in today’s housing market.

Considering that home values have increased by over 57% in the past five years, offering small concessions is a smart strategy for sellers to attract homebuyers without sacrificing profit. These real estate incentives—such as covering closing costs, offering upgrades, or including appliances—can make a home listing more competitive in today’s housing market, helping sellers close deals faster while still benefiting from substantial home equity gains.

Bottom Line

Whether you’re searching for a newly built home or an existing property, there’s a strong chance you can take advantage of valuable real estate concessions and homebuyer incentives. From closing cost assistance to mortgage rate buy-downs and upgrades, today’s housing market offers opportunities to save money and make your home purchase more affordable.

If a seller or builder offered you something extra, what would make the biggest difference to help you move forward?

Let’s discuss your homebuying goals and determine what concessions or incentives are realistic based on current housing inventory and market competition in your local real estate area. Understanding local market conditions can help you maximize savings and make informed decisions when buying a home.