Most sellers are paying buyer costs

Nearly two-thirds of Metro Denver homes that closed in the last 90 days came with the seller paying something toward the buyer's costs. Across 12,580 closings in Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas and Jefferson counties, 62% included a concession.

The national rate for the same stretch is about 46%, which Redfin called a record high. We've been running well above that for a while. The more interesting number is what changed here over the past year, which is almost nothing. It sat at 60.5% a year ago. A 1.5-point move across more than 12,000 closings is noise.

Buyers keep asking me whether it's reasonable to ask for a credit. Two out of three closings say yes.

How much

Knowing how often it happens doesn't tell you much on its own, since a $2,000 repair credit and a $20,000 rate buydown both count. So I pulled the dollar amounts on every Metro Denver closing that recorded a concession during the week of August 6 through 12 — 412 transactions.

The median came in at $10,000, or 1.8% of the close price. Just over half of all concessions were $10,000 or more, and 13% cleared $20,000. Only one in five fell below $5,000.

Ten thousand dollars buys down a rate or covers most of a buyer's closing costs. That shows up in the monthly payment, not just at the closing table.

Who gets the most

The dollar figure rises with price. The share of the purchase falls.

Buyers under $400,000 are getting close to three times the proportional help that buyers over a million are getting. The same pattern shows up by loan type: FHA buyers averaged 2.37% of the purchase price, conventional 1.83%, and cash buyers 0.58%. Cash buyers negotiate on price instead.

Coverage this summer has focused on how hard the entry level has gotten. By this measure it's the segment where sellers are bending furthest.

What doesn't predict it

I expected homes that had been sitting to give up more. They don't. Listings that sold within two weeks and listings that sat past 90 days produced the same concessions, and that holds after separating detached from attached.

Shopping the listings that have been sitting, hoping for a bigger credit, doesn't get you one. Ask on the house you want.

Mortgage rates

The 30-year fixed sits at 6.74% as of August 12, down 5 basis points on the day and back at three-week lows after July's inflation reading landed on forecast. The 52-week range runs 5.99% to 6.85%, so we're near the top of it, and the rate is up 0.16% from a year ago.

Rates aren't doing buyers any favors right now, which is why what the seller contributes matters as much as it does.

Price cut or rate buydown

A seller credit can come off the price or go toward buying down the rate. Those two aren't worth the same. At the Metro Denver median close of $575,000 with 10% down:

Same $10,000, roughly triple the monthly benefit, and the reduction lasts the life of the loan rather than resetting if you refinance.

One caution: $10,000 is about 1.9 points on that loan, and how much rate that buys moves with daily pricing and credit profile. Run the actual quote before choosing between the two. On a smaller loan or a day with worse pricing the gap narrows, though the buydown came out ahead in every version I ran.

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