Inspired by the thread on when buyers will give up on the idea of dropping interest rates.
If you were selling a home today and had the cash to do so, would you offer a rate Buy Down clause? The idea would be, as discussed in the other thread, that paying $30k in a buy down could get us $50-$80k more on the sale price.
(Selling a rental. Will probably, but not definitely, buy a residence 3-6 months later. Since we don't know where we are headed, that could be anything from a $400k property to a >$1m property. Expect sale to net very roughly $500k in our pockets after everything, without bumping up the projected sales price for any bump we might see with a rate buy down.)
We clearly could offer a rate Buy Down. Depending on where and what we buy, we might be paying cash, or we could be fnancing several hundred thousand. So the rate buy down *might* end up meaning we finance more, at our own higher rate. (If it matters, we likely wouldn't do a by down on our own mortgage because while we hope to stay wherever we land for at least 7ish years, there's some uncertainty.) So buying down our buyer's rate could mean we borrow more at current rates. Or not. If we spend $30k on the buydown and get $50k more, we'd be financing $15k less. (I say 15 and not 20, figuring some is eaten up in taxes, fees, etc.)
What am I missing? Is there something I'm not considering? Do you think buyers are actually willing to pay significantly more in the sale price if they get $$$ for a buy-down?
If it matters, this is likely a "starter home" for most people. It's an attached (duplex-style) townhouse with no yard in a VHCOL city, in a neighborhood with great schools and mostly SFHs. Somewhat dated, even after the work we are currently doing. Certainly doesn't look HGTV perfect. So I'm guessing most prospective buyers would be first-time buyers, likely scrapping buy to come up with $170k to have 20% down. (Rough guess of sales prices is $850-$880k.)
