Price Concessions

The housing glut, increases in property taxes and skyrocketing homeowners' insurance rates are having an effect on the real estate market. Often a home’s values are lower than the sales price since many price concession are made.

Before putting it on the market, they may install new carpets, new vinyl windows, ceramic tile, new appliances, redo the kitchen, ceiling fans or replace window air conditioner units.

If the home still doesn’t sell they may paint the exterior a new color, redo the landscaping etc.

If after six months on the market, a potential buyer liked the home but did not like some of the add on features, they may ask for a price concession. In this buyers market, sellers may have to make numerous financial concessions, not reflected in the sales price, to unload their properties.

If you sold you a house for $450,000 but gave you $25,000 in concessions, then that house's real value is $425,000. But, since only the sold price is recorded you can’t tell the Department of Revenue that home values is lower than the sales price unless you prove it with a study.