Dos and Don'ts of Homebuyer Incentives

The Do’s and Don’ts of Homebuyer Incentives

Should You Offer Buyer Incentives When Selling Your Home?

As a seller, it's natural to want your home to stand out. But should you offer buyer incentives — like covering closing costs, paying for new carpet, or throwing in a flat-screen TV?

The short answer: sometimes. But it depends on the market, the property, and how your offer compares to the competition.

When Buyer Incentives Can Help

In a buyer’s market — or when you're selling a home with dated features or unique floorplans — strategic incentives can tip the scale in your favor. I've seen incentives used successfully to:

  • Offset cosmetic flaws — Like offering a $3,000 flooring allowance instead of replacing outdated carpet.
  • Attract first-time buyers — Covering part of the buyer’s closing costs can be a big win for FHA or VA buyers.
  • Differentiate from the competition — If your home is comparable in price and features to nearby listings, a thoughtful incentive can grab attention.

Buyer Incentives That Work in Minnesota

  • Seller-paid closing costs (up to allowed limits)
  • Home warranties ($500–$700) — give peace of mind to buyers
  • Credit for new carpet or paint — when condition is holding buyers back
  • Flexible possession dates — helping buyers time their move smoothly

Buyer Incentives to Avoid

Some incentives can backfire, making your home seem like it's struggling to sell or causing confusion during financing.

  • Offering gift cards or TVs — lenders may see this as a concession or improper inducement
  • Huge allowances with unclear terms — they muddy negotiations and raise red flags with appraisers
  • Discounts for using a specific lender or agent — often discouraged or restricted under real estate law

Strategy First, Incentives Second

I always advise my sellers to lead with strong pricing, great presentation, and professional marketing. Only if we’re seeing slower activity — or if the comps suggest it — do we layer in incentives as a strategic move.

Sometimes, just the right incentive at the right time can revive buyer interest and close the gap in a negotiation.

Let’s Build a Smart Selling Strategy

Whether you’re prepping your home for market or already listed and want a second opinion, I’d be happy to help. I’ve worked with dozens of Minnesota sellers to price correctly, negotiate confidently, and offer incentives that work — without leaving money on the table.

💡 View my Seller Resource Hub for more strategy tips
✉ Contact me for a no-pressure listing consultation

Joe Houghton
Broker Associate | RE/MAX Results
Founder – Minnesota Property Group
📞 (763) 300-2702
🌐 www.mnpropertygroup.com

Location: Wayzata, MN, USA

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