Homebuyers in 2025 are focusing on features that blend sustainability, comfort, and style.
Here are the top trends based on emerging preferences:

Energy Efficiency: Whole-home batteries and solar panels are increasingly desirable, as buyers look for sustainable solutions to reduce energy costs and maintain resilience during power outages. EV chargers are also in demand.

Climate Resilience: Homes equipped with features like flood barriers, seismic retrofitting, and water catchment systems are gaining popularity. These elements address the growing concern over climate-related disasters.

Cozy, Purposeful Spaces: Smaller, cozy rooms with specific functions, such as dens and libraries, are replacing expansive open layouts. Buyers value intimate spaces that offer warmth and functionality.

Nostalgic Design: "Grandmillennial: A design style that combines traditional decor with modern elements to create a cozy, personalized space" aesthetics, including floral patterns, vintage furniture, and sculleries (secondary kitchens), are making a comeback. Home libraries are also seeing a surge in demand.

Spa-Inspired Bathrooms: Wet rooms that combine showers and bathtubs into one seamless, waterproof space are popular for their luxurious and wellness-focused design.

Induction Cooktops: As part of the shift towards electric and sustainable home features, induction cooking technology is becoming more prevalent.

Wellness Features: Homes that promote physical and mental health, such as air purification systems or wellness-oriented layouts, are increasingly sought after.

Multi-Functional Spaces: Buyers are interested in flex spaces that can adapt to work-from-home or other lifestyle needs.

High-Tech Integration: Smart home technologies, including whole-home energy management systems, continue to attract buyers.

Drought-Resistant Landscaping: Features like turf yards and native plant gardens appeal to environmentally conscious buyers in water-scarce areas.

Understanding the Real Estate Market: A Guide to Trends and Terminology

By Preferred Properties of Asheville

The real estate market can feel overwhelming, especially if you’re new to buying or selling property. With fluctuating trends, industry jargon, and complex factors influencing home values, understanding the basics is crucial. At Preferred Properties of Asheville, we believe in empowering our clients with knowledge. Here’s a guide to help you navigate the market with confidence.

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Key Real Estate Trends to Watch

1. Buyer’s Market vs. Seller’s Market

• Buyer’s Market: There are more homes for sale than buyers. This gives buyers the advantage, as sellers may lower prices to compete.
• Seller’s Market: There are more buyers than homes for sale. This favors sellers, often leading to higher prices and quicker sales.

2. Inventory Levels

The number of homes available for sale is a critical indicator of market conditions. Low inventory typically leads to a seller’s market, while high inventory signals a buyer’s market.

3. Interest Rates

Mortgage rates significantly impact affordability. Lower interest rates often increase buyer activity, while higher rates can cool the market.

4. Seasonal Trends

Real estate activity often fluctuates with the seasons. Spring and summer tend to be busier, while fall and winter are quieter. However, local factors in Asheville, like its popularity as a mountain getaway, can influence these trends.

5. Local vs. National Markets

National trends provide a general overview, but real estate is hyper-local. What’s happening in Asheville may differ from trends in other parts of the country.

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Essential Real Estate Terminology

1. Comparable Sales (Comps)

Recent sales of similar properties in the same area, used to determine a home’s market value.

2. Days on Market (DOM)

The number of days a property has been listed for sale. A high DOM may indicate a sluggish market or an overpriced listing.

3. Equity

The difference between the market value of your home and what you owe on your mortgage.

4. Appraisal

A professional assessment of a home’s value, often required by lenders during the buying process.

5. Closing Costs

Fees paid at the end of a real estate transaction, including taxes, title insurance, and loan origination fees.

6. Escrow

A neutral third party holds funds or documents until all terms of the sale are met.

7. Pre-Approval vs. Pre-Qualification

• Pre-Qualification: An initial estimate of how much you might be able to borrow.
• Pre-Approval: A more formal process where a lender verifies your financial information and commits to lending a specific amount.

8. Contingency

A condition that must be met for a real estate transaction to proceed. Common contingencies include home inspections and financing approval.

9. Multiple Listing Service (MLS)

A database real estate agents use to share listings with other agents and their clients.

10. Offer vs. Counteroffer

• Offer: A buyer’s proposal to purchase a property.
• Counteroffer: A seller’s response, often adjusting terms or price.

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Tips for Navigating the Market

1. Work with a Local Expert

Real estate markets vary widely, even within the same region. An experienced Asheville-based Preferred Properties agent can provide insights specific to our area, from popular neighborhoods to current market conditions.

2. Stay Informed

Follow local market reports, interest rate trends, and new listings to stay ahead.

3. Understand Your Goals

Whether you’re buying your first home, investing in a rental property, or selling to downsize, your strategy will depend on your specific goals.

4. Be Prepared

In a competitive market, having your financing in order and knowing your must-haves can make the difference between securing your dream home or losing out.

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Asheville-Specific Market Trends

1. Strong Demand for Mountain Living

Asheville continues to attract buyers seeking a balance between urban amenities and outdoor living. The city’s proximity to the Blue Ridge Mountains makes it a popular destination for retirees, young families, and remote workers.

2. Growth in Luxury Market

There’s increasing demand for high-end homes in Asheville, particularly in neighborhoods like Biltmore Forest, The Ramble, and Reynolds Mountain. Buyers in this segment prioritize custom features, scenic views, and proximity to cultural attractions.

3. Emphasis on Green Homes

Sustainability is a growing trend in Asheville’s market. Energy-efficient features, solar panels, and environmentally friendly designs are becoming key selling points.

4. Rising Home Prices

Asheville has seen steady appreciation in home values over the past decade. Limited inventory and high demand keep prices competitive, particularly in walkable areas near downtown and West Asheville.

5. Vacation and Investment Properties

As a top travel destination, Asheville’s short-term rental market thrives. Investors frequently seek properties with Airbnb or VRBO potential, although local regulations must be carefully considered.

6. Suburban and Rural Appeal

While Asheville’s city limits remain highly desirable, nearby communities like Weaverville, Black Mountain, and Hendersonville offer more affordable options with the charm of small-town living.

Should You Renovate Before Selling? A Cost-Benefit Analysis

By Preferred Properties of Asheville

When selling a home, many homeowners wonder whether investing in renovations will lead to a higher sale price or faster sale. While some updates can provide a strong return on investment (ROI), others might not be worth the time, effort, or expense. At Preferred Properties of Asheville, we help our clients navigate these decisions with a focus on maximizing value. Here’s a cost-benefit analysis to help you decide if renovating before selling is the right move for you.

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The Benefits of Renovating Before Selling

1. Attract More Buyers

Renovated homes often have greater appeal in competitive markets like Asheville, where buyers value move-in-ready properties. Updated features can make your home stand out, leading to more showings and offers.

2. Potential for Higher Offers

Modern finishes and functional spaces can justify a higher asking price. For example, an upgraded kitchen or refreshed curb appeal can increase perceived value and encourage buyers to offer more.

3. Quicker Sale

Homes in good condition tend to sell faster. By addressing potential buyer concerns, such as outdated fixtures or visible wear and tear, you reduce the chances of prolonged negotiations or a property lingering on the market.

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The Drawbacks of Renovating Before Selling

1. High Upfront Costs

Renovations can be expensive, and there’s no guarantee you’ll recoup the full amount in the sale. Large projects like kitchen remodels or roof replacements may cost more than the added value they bring.

2. Time Delays

Renovations take time, which could delay listing your home. In a fast-moving market, waiting to complete updates might mean missing out on eager buyers.

3. Risk of Over-Personalization

Not all buyers will appreciate your design choices. Bold colors or highly customized features could alienate potential buyers instead of attracting them.

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Cost-Benefit Analysis: Which Renovations Make Sense?

High-ROI Renovations

These projects typically offer the best return for your investment:

• Minor Kitchen Updates: Refresh cabinets, update hardware, and replace old appliances with energy-efficient models.
• Bathroom Improvements: Replace outdated fixtures, add modern lighting, and regrout tile for a clean, updated look.
• Curb Appeal Enhancements: Paint the front door, update landscaping, and power wash the exterior.
• Fresh Paint: A coat of neutral paint can make your home feel brighter and more spacious.

Low-ROI Renovations

These projects are less likely to recoup their costs:

• Major Remodels: Full kitchen or bathroom overhauls can be costly and time-consuming, often exceeding the added value.
• Luxury Upgrades: Features like high-end finishes, smart home systems, or custom pools may not appeal to all buyers.
• Extensive Personalization: Unusual layouts, bold color schemes, or niche additions may not align with buyer preferences.

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Consider Your Market

In Asheville, buyer preferences can vary widely based on neighborhood and property type. For example:

• Homes in highly desirable neighborhoods might benefit from cosmetic updates to match market expectations.
• Properties in up-and-coming areas may attract buyers looking for affordability over perfection, making renovations less critical.

Working with a local real estate expert can help you assess what updates are most likely to pay off in your specific market.

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Alternatives to Renovating

1. Price Strategically

If you can’t or don’t want to renovate, pricing your home appropriately for its current condition can still attract buyers.

2. Offer Credits

Provide a repair or renovation credit as part of the sale. This allows buyers to make updates themselves while ensuring you avoid upfront costs.

3. Focus on Staging

Professional staging can transform your home’s appearance without the cost of major renovations.

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Final Thoughts

Deciding whether to renovate before selling comes down to weighing costs against potential benefits. In some cases, a few strategic updates can lead to a faster sale and higher offers. In others, it may make more sense to list your home as-is.

At Preferred Properties of Asheville, we can help you evaluate your home’s current condition, market trends, and buyer expectations to develop the best strategy for your sale. Contact us today for personalized advice on preparing your home for the Asheville market!

Staging Secrets to Sell Your Home Faster

By Preferred Properties of Asheville

When selling your home, first impressions are everything. A well-staged home not only looks appealing but helps potential buyers envision themselves living there. At Preferred Properties of Asheville, we know how to highlight a home’s best features to attract offers quickly and at the best price. Here are some expert staging secrets to help you sell your home faster.

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1. Declutter and Depersonalize

Buyers want to see the potential of the space, not your personal belongings. Start by:

• Decluttering: Remove excess furniture, knick-knacks, and items that make the space feel cramped.
• Depersonalizing: Take down family photos, personalized decor, and collections. This allows buyers to imagine their own life in the home.

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2. Deep Clean Every Room

A sparkling clean home signals to buyers that it has been well-maintained. Pay special attention to:

• Kitchens and Bathrooms: Scrub grout, polish fixtures, and make surfaces shine.
• Floors and Carpets: Consider professional cleaning to eliminate stains or odors.
• Windows and Mirrors: Clean glass surfaces to maximize light and create a polished look.

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3. Highlight Key Spaces

Focus on the rooms that make the biggest impact:

• Living Room: Arrange furniture to create a cozy, inviting atmosphere.
• Kitchen: Clear counters of small appliances and add fresh fruit or flowers for a pop of color.
• Bedrooms: Use neutral bedding and minimal decor to create a relaxing retreat.

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4. Use Neutral Colors

A fresh coat of paint in neutral tones can do wonders for a home’s appeal. Colors like soft gray, beige, or white make spaces feel larger and allow buyers to imagine their own decor. Avoid bold or trendy colors that might not appeal to everyone.

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5. Let There Be Light

Bright, well-lit spaces feel more inviting. Maximize natural and artificial lighting by:

• Opening Curtains and Blinds: Let sunlight fill the room.
• Replacing Bulbs: Use warm, consistent lighting throughout the home.
• Adding Lamps: Light up darker corners to make spaces feel larger and cozier.

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6. Enhance Curb Appeal

The exterior of your home is the first thing buyers see. Make a great impression by:

• Tidying Up Landscaping: Mow the lawn, trim bushes, and add fresh mulch.
• Painting the Front Door: Choose a welcoming, bold color to create a standout entrance.
• Adding Potted Plants: Place flowers or greenery near the entryway for a warm touch.

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7. Stage Outdoor Spaces

Outdoor areas are especially important in Asheville, where buyers often value spaces for relaxing or entertaining. Consider staging:

• Porches and Patios: Add comfortable seating, outdoor rugs, or string lights.
• Gardens or Lawns: Highlight areas for gardening or play.

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8. Add Finishing Touches

Small details can leave a lasting impression:

• Fresh Flowers: Place vases of flowers in key areas like the dining table or kitchen.
• Scent: Use subtle, natural fragrances like lavender or vanilla. Avoid overpowering air fresheners.
• Art and Decor: Use simple, tasteful decor to complement the space without overwhelming it.

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9. Create a Lifestyle

Stage your home to reflect the lifestyle buyers aspire to. In Asheville, that might mean incorporating cozy mountain-style decor, showcasing a fireplace, or setting up an inviting outdoor seating area. Highlight unique features of your home that align with local trends and tastes.

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10. Work with Professionals

Professional staging services can make a significant difference in how your home is perceived. At Preferred Properties of Asheville, we can recommend trusted staging experts or guide you through the process to ensure your home stands out in the market.

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Final Thoughts

A well-staged home can make all the difference in attracting buyers and securing offers quickly. By following these staging secrets, you’ll showcase your property in the best light and make it irresistible to potential buyers.

Ready to sell your home? Contact Preferred Properties of Asheville today to learn how we can help you prepare, market, and sell your home with confidence!

Top Tips for First-Time Homebuyers

Buying your first home is an exciting milestone, but it can also feel overwhelming. From securing financing to finding the perfect property, there are many steps in the process. With the right guidance, however, you can navigate it like a pro! Here are our top tips to help first-time homebuyers make confident decisions and avoid common pitfalls.

1. Understand Your Budget

Before you start house hunting, take a close look at your finances. Assess your income, savings, and monthly expenses to determine how much you can afford. Use a mortgage calculator to estimate monthly payments, including property taxes, insurance, and HOA fees if applicable. Remember to leave room in your budget for unexpected expenses or emergencies.

2. Get Pre-Approved for a Mortgage

Getting pre-approved for a mortgage helps you understand your borrowing power and shows sellers that you’re a serious buyer. Compare lenders to find the best interest rates and terms. Keep in mind that pre-approval isn’t the same as final approval, so avoid making big financial changes, like switching jobs or opening new credit lines, during the homebuying process.

3. Make a List of Must-Haves and Nice-to-Haves

What features are non-negotiable in your new home? Think about the number of bedrooms, location, yard size, or proximity to work or schools. Separating your "must-haves" from your "nice-to-haves" will help you stay focused and prioritize what matters most.

4. Research Neighborhoods Thoroughly

A home isn’t just about the property; the neighborhood is just as important. Consider factors like school ratings, walkability, safety, and nearby amenities. Visit potential neighborhoods at different times of the day to get a feel for the area.

5. Don’t Skip the Home Inspection

Even if the home looks perfect, a thorough inspection is essential. A professional inspector can identify hidden issues, such as plumbing problems, roof damage, or foundation concerns. This step can save you from unexpected costs down the road and provide leverage in negotiating repairs or price reductions.

6. Plan for Additional Costs

First-time buyers often overlook the extra expenses associated with purchasing a home. Be prepared for closing costs, which can range from 2-5% of the home’s price. Additionally, budget for moving expenses, utility connections, and immediate repairs or upgrades.

7. Work with a Knowledgeable Real Estate Agent

A skilled real estate agent is your best ally in navigating the complexities of buying your first home. They can help you find properties that match your criteria, negotiate on your behalf, and guide you through the paperwork.

8. Be Patient and Flexible

Finding the perfect home takes time. You might need to compromise on some features or adjust your budget as you explore your options. Stay open-minded and trust the process.

9. Learn About First-Time Homebuyer Programs

Many states and local governments offer programs to help first-time buyers, including grants, low-interest loans, or tax credits. Research what’s available in your area—you could save thousands!

10. Think Long-Term

Consider your future needs when buying a home. Are you planning to grow your family, work from home, or stay in the area for years? Choose a property that aligns with your long-term goals.

Final Thoughts

Buying your first home is a big step, but with preparation and the right team by your side, it can be a smooth and rewarding experience. By following these tips, you’ll be well on your way to finding the home of your dreams.

Are you ready to start your homebuying journey? Contact us today to learn how we can help you every step of the way!

An open house is an event organized by a real estate agent, seller, or broker to showcase a property for sale to potential buyers. The event is typically scheduled for a few hours on a specific day, allowing interested buyers to tour the home without needing an appointment. Open houses are designed to attract a broad range of visitors, including those who may not have committed to buying yet.

Features of an Open House:

1. Casual Atmosphere: Visitors can explore the home at their own pace.
2. No Appointment Needed: Unlike private showings, buyers can drop in during the advertised hours.
3. Staging: Homes are often cleaned and staged to look as appealing as possible.
4. Agent Presence: A real estate agent is usually present to answer questions and provide details about the property.

Do Open Houses Work?

The effectiveness of open houses depends on the market, the property, and the goals of the seller and agent:

Advantages:

• Exposure: Open houses can attract buyers who may not have scheduled a private showing.
• Convenience: Buyers can view a property without the pressure of a one-on-one appointment.
• Potential Bidding Interest: A busy open house can signal demand, encouraging competitive offers.
• Leads for Agents: Agents often meet new potential clients at open houses.

Disadvantages:

• Unqualified Visitors: Many attendees may not be serious buyers, just curious neighbors or window-shoppers.
• Limited Offers: In competitive markets, serious buyers often prefer private showings over open houses.
• Security Risks: Allowing many people into a home increases the risk of theft or damage.

Do They Lead to Sales?

• Yes: In some cases, open houses help sell homes by generating buzz and creating a sense of urgency.
• No: In other cases, especially for high-value properties, most buyers come through private showings.

When Are Open Houses Most Effective?

• In a hot market with high buyer activity.
• For newly listed properties that generate early interest.
• When the property is priced competitively and has broad appeal.

Would you like to know how to maximize an open house or alternatives to hosting one?

As a home seller, you have a wide range of choices when deciding how to market your property. This includes whether you'd like to offer-or authorize your agent to offer-compensation to a buyer's agent as a way to attract potential buyers. Here's what you need to know as you consider your options related to offering compensation:

1. What is an offer of compensation and why make one? An offer of compensation is when you­the seller-or your agent compensate another agent for bringing a buyer to successfully close the transaction. Offers of compensation help reduce out-of-pocket costs for prospective buyers, which in turn may bring more potential buyers for the transaction. These costs can be especially significant for first-time buyers, lower- to middle-income buyers, or those from underserved communities.
2. Are offers of compensation mandatory? No. It is up to you to determine if making an offer of compensation is the best approach for selling your property. Agents who are REALTORS® are here to help answer your questions and guide you to make a decision that works for you.
3. As a seller, does my agent need my permission to offer compensation to a buyer's agent? Yes. Your agent can only offer compensation or make a payment to a buyer's agent if they have your written approval and signoff on the amount.
4. What types of compensation can I offer? There are many options available to you as a seller to discuss with your agent. These could include a flat fee paid directly to the buyer's agent or allowing your agent to share a part of their compensation with the buyer's agent. Beyond compensation, you could also consider offering a buyer certain concessions, such as covering closing costs, to make the total home purchase more affordable for them.
5. How will a buyer's agent know if there is an offer of compensation? Offers of compensation can be advertised in many ways. If you approve an offer of compensation, it can be shared through common marketing methods such as flyers, signs, brokerage websites, social media posts, or simply through a phone call or email. Offers of compensation cannot be listed on Multiple Listing Services (MLSs), on line platforms that compile home listings from many different sources.
6. Do I have to advertise an offer of compensation if I decide to make one? No, it's up to you to decide. Advertising can help get the word out to bring more buyers to the table, but you can also choose not to advertise and instead negotiate the offer in a purchase agreement.
7. You mention concessions-what does that mean? A seller concession is different than an offer of compensation. It is when a seller covers certain costs associated with purchasing a home for the buyer. Concessions can make home ownership more accessible for buyers by reducing upfront expenses. These can cover things like some transaction costs or property repairs.
8. How do I know what option is best for me? When you work with an agent who is a REALTOR®, you are working with a professional guided by ethical duties under the REALTOR® Code of Ethics, including the pledge to protect and promote the interests of their clients. Your agent will work with you to weigh your options, answer questions, and develop a strategy you are confident in. You can read more about REALTORS'® duty to put client interests above their own here.

Practices may vary based on state and local law. Consult your real estate professional and/or consult an attorney for details about state law where you are purchasing a home. Please visit facts.reg/tor for more information and resources.

CONSUMER GUIDE: FAIR HOUSING

Buying or selling a home is more than a transaction-it's fundamental to your long-term goals and financial future. Consumers and agents all have rights and responsibilities to promote a home buying or selling process free from discrimination. Here's what you need to know:

What is "fair housing" and how does it help me? The federal Fair Housing Act prohibits discrimination in housing and housing-related transactions based on race, color, sex (including sexual orientation and gender identity), national origin, religion, disability, or familial status. Local and state fair housing laws may prohibit discrimination on additional protected classes. The bottom line is that discrimination hurts all sides of a home transaction, closes the door on the American dream of homeownership, and perpetuates economic inequality. Homebuyers, home sellers and real estate professionals depend on strong fair housing laws and practices for our communities and economy to thrive.

How do fair housing laws apply to me as a buyer? You should expect to receive the same professional service in the homebuying process regardless of any protected characteristic. This includes equitable treatment by your agent, the seller, the seller's agent, appraisers, lenders, and others involved in your home search and purchase. You should also expect your agent to provide you with home options in your price range regardless of the racial or ethnic composition of neighborhoods.

How do fair housing laws apply to me as a seller? You cannot discriminate when selling your home based on the buyer's race, color, sex (including sexual orientation and gender identity), national origin, religion, disability, or familial status. You also cannot instruct your agent to conduct a sale any differently based on these prohibited reasons. That means you cannot advertise your home to just one or to a limited number of groups.

How does working with an agent who is a REALTOR® help ensure fair housing practices are followed? In addition to an obligation to comply with applicable fair housing laws, REALTORS® adhere to the highest ethical standards. the REALTOR® Code of Ethics obligates REALTORS® to provide equal professional services to all consumers. Among other ethical duties, REALTORS® must not discuss the demographic composition of a neighborhood, advertise a property in a way that indicates any preference, limitations, or discrimination for a prohibited reason. Read more about REALTORS'® duty to put client interests above their own here.

Where can I report suspected discrimination in the homebuying or selling process? Report housing discrimination to the Office of Fair Housing and Equal Opportunity (FHEO) at the Department of Housing and Urban Development (HUD) and ethical violations to your agent's state or local REALTOR® Association (find an association here). You can also report concerns to a local nonprofit fair housing organization (find by ZIP code here). Fair housing laws prohibit harassment or intimidation if you report discriminatory behavior.

The Fair Housing Act is a federal law; many state and local laws provide additional protections. Consult your real estate professional, an attorney, and your state's housing authority for details about applicable fair housing laws where you are selling or purchasing a home. Please visit facts.realtor for more information and resources.

“If 35 to 40 potential buyers have toured your home without making an offer, it’s time to seriously think about adjusting the price,” advises New York City real estate agent Brad Malow. In other words, consider a price reduction.

It is Rare to Undervalue a Home

When contemplating a price cut, remember that the market often makes that decision for you.

“It’s nearly impossible to underprice a home, as the market will typically drive the price back up,” says Mike King, an agent with the Partners Trust Realty in Brentwood, CA.

Consider it like eBay: you might list an item for $1, knowing it is worth around $250. Over time, bidding can push the price to $275 or more. It is more advantageous to slightly underprice your home rather than overprice it; this strategy attracts more offers, creating a competitive atmosphere.

“It’s about leveraging power,” explains King. “If I’m a motivated buyer and there are only three offers, I won’t be as aggressive as if there were ten.”

In real estate, if your home has been on the market for an extended period without serious interest, it may be wise to consider lowering the listing price. Some experts recommend making a price adjustment within two weeks of listing, especially if inventory is limited, while others suggest waiting two to four weeks.

Signs It May Be Time to Lower Your Price:

• Few Showings: If your home has not been shown much, a price reduction may be necessary.
• Negative Feedback: If buyers are consistently providing unfavorable feedback, it is time to rethink the price.
• No Offers: A lack of offers after a reasonable time could indicate the need for a price adjustment.
• Online Views but No Offers: High online viewership without offers may suggest that the price is too high.
• Open House Attendance Without Results: Good attendance at open houses but no offers could mean it is time to lower the price.

When considering a price reduction, look at your local housing market. Evaluate the average number of days homes stay on the market in your area and consider getting a comparative market analysis (CMA) to understand recent sales of comparable properties.

Assess your market conditions. There’s no one-size-fits-all timeline for price adjustments, but Malow emphasizes three key points to consider:

1. How are comparable properties performing? Are they selling quickly or lingering? What were their closing prices?
2. What is the average market time for homes in your neighborhood? If your home has not reached that duration, it may be too soon to reduce the price. Conversely, if you are beyond that time, it might be time to lower your price or even consider delisting.
3. How many homes in your area have had price reductions, and what was the outcome? Did those reductions help sell the properties, and what were the final sale prices?
   
   
   Source: Realtor.com

CONSUMER GUIDE:
OFFERS OF COMPENSATION
Provided by the National Association of REALTORS®
As a home seller, you have a wide range of choices when deciding how to market your property.
This includes whether you’d like to offer—or authorize your agent to offer—compensation to a buyer’s agent as a way to attract potential buyers. Here’s what you need to know as you consider your options related to offering compensation:
What is an offer of compensation and why make one? An offer of compensation is when you— the seller—or your agent compensate another agent for bringing a buyer to successfully close the transaction. Offers of compensation help reduce out-of-pocket costs for prospective buyers, which in turn may bring more potential buyers for the transaction. These costs can be especially significant for first-time buyers, lower- to middle-income buyers, or those from underserved communities.
Are offers of compensation mandatory? No. It is up to you to determine if making an offer of compensation is the best approach for selling your property. Agents who are REALTORSÒ are here to help answer your questions and guide you to make a decision that works for you.
As a seller, does my agent need my permission to offer compensation to a buyer’s agent? Yes.
Your agent can only offer compensation or make a payment to a buyer’s agent if they have your written approval and signoff on the amount.
What types of compensation can I offer? There are many options available to you as a seller to discuss with your agent. These could include a flat fee paid directly to the buyer’s agent or allowing your agent to share a part of their compensation with the buyer’s agent. Beyond compensation, you could also consider offering a buyer certain concessions, such as covering closing costs, to make the total home purchase more affordable for them.
How will a buyer’s agent know if there is an offer of compensation? Offers of compensation can be advertised in many ways. If you approve an offer of compensation, it can be shared through common marketing methods such as flyers, signs, brokerage websites, social media posts, or simply through a phone call or email. Offers of compensation cannot be listed on Multiple Listing Services (MLSs), online platforms that compile home listings from many different sources.
Do I have to advertise an offer of compensation if I decide to make one? No, it’s up to you to decide. Advertising can help get the word out to bring more buyers to the table, but you can also choose not to advertise and instead negotiate the offer in a purchase agreement.
You mention concessions—what does that mean? A seller concession is different than an offer of compensation. It is when a seller covers certain costs associated with purchasing a home for the buyer. Concessions can make home ownership more accessible for buyers by reducing upfront expenses. These can cover things like some transaction costs or property repairs.
How do I know what option is best for me? When you work with an agent who is a REALTOR®, you are working with a professional guided by ethical duties under the REALTOR® Code of Ethics, including the pledge to protect and promote the interests of their clients. Your agent will work with you to weigh your options, answer questions, and develop a strategy you are confident in.
You can read more about REALTORS’® duty to put client interests above their own here.
Please visit https://www.nar.realtor/the-facts for more information and resources, and consult your real estate professional or attorney for details about state law where you are buying or selling a home.
#narsettlementexplained #NAR #buyercompensation #homesellers #homebuyers