The once-hot housing market's about-face has created amazing incentives for buyers. What are you waiting for?
How would you like a $10,000 gift certificate for Pottery Barn?
A $30,000 in-ground swimming pool - installed? The chance to toss back a few drinks with rocker John Legend? These and many other fabulous prizes can be yours if.
..you buy a house!
That's right, Bob Barker. After years of soaring prices, in the past few months the real estate market has dropped faster than most people thought it would, even in markets where most people thought it wouldn't. Home builders, mortgage lenders and even some enterprising individual sellers have been racking their brains to come up with tantalizing incentives to get potential buyers to the closing table and to convince top brokers to work with them.
As buyer's markets go, this is shaping up to be a good one - as long as you know how to play it to your advantage.
But gimmicks like new pools and mingling with rock stars are a distraction, says Mark Zandi, chief economist of Moody's Economy.com.
If you're truly savvy about selecting and bidding on a home, you may be able to do better, he says. Much better.
Home inventories have gone skyward in the past year.
In August (the most recent month for which data are available) there were 4 million homes on the market in the United States, a million more than at the same point in 2005. Combine that with the boost in interest rates and you have a lot of nervous sellers.
"Until now sellers didn't want to cut their prices.
They were much more willing to provide an incentive - refinish the deck, seal the driveway, help with the financing, anything but cut the price," says Zandi. That's because incentives are cheaper for the seller in most cases.
Knocking 5% off a $300,000 home, for example, costs $15,000, but giving away that Pottery Barn shopping spree costs less and sounds sexier.
Right now, however, there's enough inventory that sellers are starting to do both: lower prices and provide incentives. This sharp change is not happening at all times in all markets, Zandi says, and only by knowing what kinds of freebies are being doled out can you jump on the trend and score a better deal (and maybe a new pool too).
Here's what to do.
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