Price Drops vs Rate Drops – Unfair To Your Neighborhoods

Wade Betz

Published 1 month ago


These higher interest rates are impacting buyers' qualifications, if you have not noticed. The higher rates are also beginning the "price reduction" trend, which sellers use to help attract affordable housing for buyers.

But, most sellers don't know or can show the actual numbers on how that impacts buyers. This inability to show the numbers and knowledge of how dropping the rates has a more significant impact on a buyer's payment than lowering a sales price could ever have.

Price vs. Rate -

In this presentation, I wanted to show you, through this side-by-side comparison, how a PRICE DROP amount impacts a potential buyer's payment & qualification, but also how, with the same amount of money, you could triple the positive impact on a potential buyer.

Seller Buy Down -

The benefits of reducing a buyer rate vs. a list price are numerous, here are just a few of them.

Positive Benefits:

1. 3/1 Ratio - A seller could triple savings on a buyer's payment if they applied the same amount of funds they reduced their price.

2. 1/3 Ratio - A seller could apply 1/3 of their potential price drop amount to lower a buyer rate and have the same financial benefits to the buyer. ( keep 2/3 of a possible price drop on their net sheet )

3. Understanding the limited costs to drop rate, a seller could use a Seller Buy Down on full-price offers and protect their comps in the farms that produce the repeat business.

4. Address our buyer's affordability crisis head one with limited funds to implement a seller buy down vs. costly price reductions

Marketing Your Property -

Now that you understand how powerful a tool it is to reduce rate vs. price with the Seller Buy Down, then let's market your property with a custom SBD Video from me so that we can spread and help affordability to all buyers.

SBD Example -

Here is how a seller-provided TWO options to all potential buyers. With a full-price offer, a buyer could take 30k off the sales price OR 30k in a Seller Buy Down to help lower their interest rate.

Video Compares a 20k PriceDrop vs a 20k Rate Drop on a 600K Listing, You Will Be Surprised!

Video Compares a 50k PriceDrop vs a 50k Rate Drop on a 1M Listing, You Will Be Surprised!

Video Compares a 100k PriceDrop vs a 100k Rate Drop on a 3M Listing, You Will Be Surprised!

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Axen Mortgage

Company NMLS# 1660690

3100 W Ray RD STE 201 Office # 209
Chandler, AZ 85226
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