New Home Builder Incentives for Resort-Style Residential Communities
Finding buyer incentives for your second home, vacation home, active retirement community or the home of your dreams can be different from the regular "special incentives" you find offered by housing developers like Del Webb, Toll Brothers, and many others. With resort lifestyle community home sites starting in the $500, 000s and homes starting around the $900,000s, incentives can take on a whole new direction. Whether it's a new car, interior designing or discounted prices and closing costs - today's housing market certainly has engaged in creative ways to get home buyers into their doors.
Truly, the bottom line of every home buying experience is that you have to love your new home and feel welcomed by it every time you step through its doors. Resort-style master-planned and private communities takes this a step further; with golf, tennis, spa retreats, fine-dining, community activities, special interest classes and concierge service offered right in the community, residents not only feel welcomed, but feel like they are vacationing at a luxury resort from the comfort of their own home.
This lifestyle experience is our specialty. Let one of our Resort Lifestyle Specialists be your personal concierge. Not only do we help you find the right community for you, but we'll help you get the most out of this exciting experience. If you are looking for a private golf communities in Arizona or a gated community on the beach in California, our matching finds you latest incentives being offered and will help you find the lifestyle community you are looking for.
Below are six of the most common incentives being used in markets today according to Marketplace.com. Although some of these incentives focus in first-time and upgraded family home buying, knowing what is commonly offered is a good foundation for negotiation when dealing with community homes at a higher price point.
1. Reducing the price
A price reduction might be the most common buyer incentive, and often it is the one that is looked at first, said Delores Conway, director of the Casden Forecast at the University of Southern California's Lusk Center for Real Estate.
"The price is something that is a common currency -- it appeals to everybody," she said. Gene Rivers, who owns four Keller Williams offices in Florida, agreed. If a buyer has in her mind that she'll pay $350,000 for a home and the seller won't budge from $375,000, "$5,000 in closing costs and a plasma TV ain't going to get it done," he said. But those extra little perks can grab the attention of a buyer; it also might inspire a commitment from someone on the fence between two similarly priced properties, Dalzell said.
2. Paying points
Sellers can offer to pay mortgage points for a buyer, an incentive that Dalzell tends to use in environments like today's, when rising interest rates are at the front of a buyer's mind. One point is 1% of the loan amount, charged as prepaid interest. For example, instead of having an interest rate at, say, 6.5%, a seller might be able to pay points so that the rate is at 4.5% for the first year, Dalzell said. "When a buyer sees a lower interest rate or monthly payment, that's something they can relate to," he said. The setup makes sense for a buyer who has furnishings to buy for the new place; it also can make for an easier monthly-payment transition for families that are upsizing.
A word of caution to buyers considering this tactic, however: This assistance doesn't last forever and usually spans about one to three years. Before accepting, understand and plan for the point in time when the window closes and payments return to their normal levels.
3. Down-payment aid
For some buyers, the hardest part of entering the ranks of homeownership is the down payment -- also an area where a seller can help. It's mostly first-time home buyers interested in this kind of assistance because they're often the ones lacking in funds to complete a deal, Zadel said. "It gets people into homeownership," he said. "The disadvantage is that the buyer is financing that additional amount," he added, because a seller would likely come down in the price of the home if a chunk weren't dedicated to down-payment assistance.
4. Help with closing costs
Closing costs include items ranging from taxes to title insurance and can add up, ranging between 2% and 7% of the loan value, according to Freddie Mac. So many buyers, especially those stretching to make a down payment, will be interested in having a seller help out. In Phoenix, buyers in every price range have been asking that these costs be covered, according to Ramsey. "They ask for it because they know that they'll get it," she said.
5. Adding a home warranty
A residential service contract is sometimes thrown in as an incentive because it acts as insurance for a home's systems, often including plumbing, heating and cooling. At a cost of a few hundred dollars, some real-estate agents consider it an inexpensive add-on that affords a buyer a little extra peace of mind, Dalzell said. That peace of mind can be especially welcome during the first year in a house. Others take a different view, and say there's often confusion over what elements are covered. If a problem is considered a pre-existing condition, assistance could be limited. Plus, a warranty might not be necessary for a handy buyer who would likely take on projects himself, or " if you're buying a condo that's two years old, a home warranty might not be that big of a deal," added Zadel. Those who accept a warranty should read the service contract and call the 1-800 number to ask questions, Dalzell said. If the seller pays for this add-on, he recommends having the buyer choose which company to use.
6. The little things
Other perks will appeal to buyers, too, ranging from the common to the unique. Payment of homeowner association fees -- typically associated with condo developments -- are sometimes offered. Ramsey said that sellers with pools might also offer a year's worth of upkeep for it, a welcome help to those worried about the maintenance of the backyard attraction. Or maybe if a corner of the home was designed to fit a grand piano, leaving that instrument behind entices a buyer to go through with the deal, Conway said. The important thing for buyers to remember, Conway added, is that they should honestly want this add-on. Translation: A homeowner with no interest in music probably should give up a piano for a more personalized incentive.
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