Connecticut Homes Sales And Buyers Cash Rebates
As just one example of the real estate slump, Connecticut homes have declined in value in the past few years
. Brokerage firms are using cash back rebates for buyers to stimulate sales of homes. The source of the cash is the broker's portion of the sales commission. Typically, the seller's broker gets 3 percent and the buyer's broker also gets 3 percent. With cash back rebates, Connecticut brokers are rebating to buyers 2 percent of their commission.If the total sales commission is 6 percent of the selling price, the seller's broker takes 3 percent and the buyer's broker takes the other 3 percent. With a buyers cash back rebate, the buyer's broker keeps 1 percent of his part of the commission and gives 2 percent to the buyer. The house gets sold, and the seller is relieved of a mortgage payment he can not afford to pay on a house that is worth less than the balance of the mortgage. Both real estate brokers make some money, as opposed to none, and the buyer is happy also. In fact, everybody is happy.
Times that stretch financial boundaries require creative solutions. SGI Realty One is a brokerage firm in Connecticut that is making full use of these creative solutions in an effort to stimulate sales. When buyers are in an up side down position of owing more on their mortgage than the value of the home, they become more flexible and motivated to sell. These conditions have resulted in brokerage firms' departure from the more traditional way of doing business.
There are two sides to these real estate stories. Home owners who had adjustable rate mortgages could not keep up with escalating mortgage payments. The market saw an unprecedented amount of foreclosures and short sales. Home prices dropped and suddenly people who could not afford to buy a home found that they could become a homeowner. Brokers saw an opportunity to encourage buyers and earn commissions. Getting 1 percent of a commission beats getting 3 to 6 percent of nothing.
Bethel, Connecticut is an example of the dramatic drop in home values from 2006 to 2010. In 2006, the low, mid and high prices in Connecticut were $306,000, $419,000 and $551,000. Fast forward to 2010 shows a sharp decline with low, mid and high prices dropping to $196,000, $319,000 and $363,000 respectively. Creative financing was needed to jump start slow sales.
The SGI Realty One Web site has a graphic schematic showing a flow chart with the 6 percent sales commission. The total sales commission is 6 percent, with 3 percent going to the seller's broker and 3 percent going to the buyer's broker. To encourage sales, the broker rebates two thirds of his commission to his buyer client. This cash rebate has successfully stimulated sales at SGI.
Your broker is motivated to get you the lowest possible selling price, which will work to offset the seller's broker shooting for the highest possible selling price. The terms of your agreement with the SGI broker will be in writing well before the time you purchase a home. Your rebate is guaranteed.
The rebates happening with Connecticut homes are happening in many other parts of the United States as well. Today there are more houses for sale on the market than there are buyers. The law of supply and demand dictates that this condition will further drive the prices down. Buyers can use this situation to their advantage. SGI Realty One works hard to make sure that homes are affordable to most consumers. You can expect to get a fair price and some money back into your pocket.
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