SEATTLE – Home sellers gave concessions to buyers in 35% of U.S. home sales during the third quarter (3Q) of 2023, according to a report from Redfin – about the same as one year earlier (35.9%) but up from 27.6% two years earlier.

The study included only U.S. metros with at least 50 closed sales during 3Q, with three Florida cities on the list. Orlando came closest to the national numbers in 2023 and 2022, and while Miami saw a decline in concessions, it was on par with national ones.

Tampa, however, saw a rise in seller concessions to 43.1% and a year-ago number lower than national figures – 19.7%.

Fla. metro buyer concessions (metros had at least 50 closed deals)

• Miami: 35.4% in 2023, down from 40.0% in 2022
• Orlando: 34.3% in 2023, down from 35.7% in 2022
• Tampa: 43.1% in 2023, up from 19.7% in 2022

The data is based on sales by Redfin’s agents. For the study, a concession is considered something that helped reduce the buyers’ total cost of purchasing the home. It could include money toward repairs, closing costs and/or mortgage-rate buydowns. It does not include a seller-lowered list price or price cut that resulted from buyer negotiations.

“Sellers have become more open to the idea of giving out concessions, like cash for repairs and mortgage-rate buydowns, in part because many of them want to get their homes sold quickly due to major life events like divorces and new jobs,” says Seattle Redfin agent David Palmer. “Homeowners who don’t have to move are staying put and holding onto their low mortgage rates.”

Roughly 53,000 U.S. home-purchase agreements were canceled in September, equal to 16.3% of homes that went under contract that month – the highest percentage since October 2022, when mortgage rates surpassed 7% for the first time in two decades.

Another reason concessions have climbed from pandemic lows is that homebuilders are offering deals to offload inventory and taking up a growing portion of the market. Nationwide, 30.6% of U.S. single-family homes for sale in the third quarter were new construction, the highest share of any third quarter on record, in part because fewer homeowners are offering up existing homes for sale.

Concessions plus lower prices

Some sellers gave out concessions even after lowering a listing’s asking price.

In 3Q, one in seven (14.4%) homes that sold had a final sale price below the asking price plus a concession. Just over one in 10 (11.5%) 3Q home sales had a price cut and a concession. And 6.4% had all three – a concession, a price drop and a final sale price below the original list price.

© 2023 Florida Realtors®

Source: https://www.floridarealtors.org/news-media/news-articles/2023/11/1-3-sellers-granting-buyer-concessions?utm_campaign=11-15-23+Florida+Realtors+News&utm_source=iPost&utm_medium=email