The technology-driven real estate broker reported that 44.4 percent of home-sale transactions included a concession—such as funds for repairs, closing costs, or mortgage-rate buydowns—up from 39.3 percent a year ago and close to the record 45.1 percent seen in early 2023.
“When buyers have more options to choose from, it typically means they have more negotiating power,” the report stated. “Plus, Redfin agents report that many homes are overpriced, which often means they linger on the market, forcing sellers to offer concessions to find a buyer.”
The concessions reflect a shift in the housing market, which has become more favorable to buyers due to reduced demand and increased competition among sellers, the report stated. Listings have now reached a five-year high, giving buyers more options and leverage.
“Buyers used to ask for concessions to cover little things like repairs,” said Chaley McVay, a Redfin Premier real estate agent in Portland, Oregon. “Now they’re negotiating concessions so they can afford to buy a home. A lot of sellers are offering money for mortgage-rate buydowns, and I recently had one seller cover seven months of HOA fees for the buyer.”
McVay noted that many sellers are concerned about their net proceeds, especially those who purchased at market peaks in 2021 and 2022 and may now face higher mortgage rates if buying again. Concessions can help close deals without reducing list prices, she said.
Seattle saw the highest increase in concessions among major U.S. metropolitan areas, with 71.3 percent of home sales including concessions—nearly double the 36.4 percent rate a year ago. Portland followed with a 63.9 percent rate, up more than 14 percentage points. Los Angeles, San Jose, and Houston also posted notable increases.
In contrast, New York City saw the sharpest decline, with just 5.5 percent of sellers providing concessions, down from 21.2 percent. Miami, San Antonio, Tampa, and Phoenix also saw declines, as sellers in these markets have already adjusted pricing expectations due to prolonged cooling trends.
In addition to concessions, some sellers are lowering their asking prices or accepting offers below the list price. Redfin found that 21.5 percent of homes sold in the first quarter went for less than asking and included a concession, while nearly 10 percent had a concession, a price cut, and a final sale below the original list price.
Economic uncertainty appears to be weighing on prospective homeowners as well. Approximately 13 percent of pending home sales were canceled in March, equating to roughly 52,000 canceled transactions.
This marks the third-highest March cancellation rate since 2017, following a pandemic-driven peak in 2020.
