Nearly Half of U.S. Home Sales Now Include Seller Concessions: What Central Jersey Buyers Can Realistically Ask For

Central Jersey Home Buying & Negotiation

By Jasmine Tsui (徐佳美) · Weichert Realtors® · Central New Jersey · Updated October 18

Short answer on seller concessions in Central Jersey: nationally, sellers gave buyers a concession in 44.7% of home sales this summer. In the New York metro the figure was 5.7%. Central Jersey buyers can ask for credits toward repairs, closing costs, or a rate buydown, but success depends on the specific house: how long it has been listed, whether the price has been cut, and what the inspection finds.

72.8% in Atlanta. 5.7% in New York. Those are the shares of home sales that included a seller concession this summer, according to Redfin, and the gap between them is the whole story for buyers here. The national headlines say concessions are now standard. In our part of the country they are still the exception. That does not mean you cannot get one in Edison, Metuchen, or South Brunswick. It means you have to know which houses to ask on, what to ask for, and how to ask.

What the Data Says

Redfin reported in September that sellers gave concessions in 44.7% of U.S. home sales in the three months ending August 31, up from 42.6% a year earlier and the highest August reading in at least six years.For comparison, the share was around 35% in the same period two and three years ago. Redfin also found that 15.8% of sales included both a concession and a price cut, a record for August. These figures come from Redfin’s national seller-concessions report.

Source: Redfin’s September report, covering the three months ending August 31. The New York metro figure is the closest to our area in Redfin’s analysis, but it is not a Central Jersey number. Confirm current data before making a decision.

[Insert Chart: share of sales with a seller concession, Atlanta vs. U.S. vs. New York metro]

What Counts as a Concession

A concession is anything the seller provides that lowers the buyer’s total cost of the purchase without changing the contract price.The common forms in New Jersey transactions:

How Much a Seller Is Allowed to Contribute

Your loan program caps how much the seller can pay toward your costs, and the cap depends on the loan type and your down payment.As a general guide, conventional loans on a primary residence commonly allow seller contributions of 3% of the price when the down payment is under 10%, 6% when it is between 10% and 25%, and 9% when it is 25% or more.

FHA loans commonly allow up to 6%, and VA loans limit certain seller concessions to 4%. These rules change and have exceptions, so your loan officer needs to confirm the limit for your loan before we put a number in an offer. The Consumer Financial Protection Bureau’s home-buying resources explain how seller credits appear on your Loan Estimate and Closing Disclosure.

One more limit: a credit cannot exceed your actual closing costs and prepaid items. If the seller offers more than you can use, the extra does not come back to you as cash.

Price Reduction or Credit?

The same $10,000 does different jobs. A price reduction mostly lowers your loan. A credit mostly lowers the cash you need on closing day.Here is an illustration on a $700,000 purchase with 20% down and a 30-year fixed loan at 7.03%.

Illustrative math only, based on mid-October rates. Actual figures depend on your loan terms and closing costs. For the same comparison using a rate buydown, see my article on price cuts and seller credits.

When to Ask for Seller Concessions in Central Jersey

Ask where you have leverage, and keep the request tied to something specific.

• The home has been listed for more than a month. Redfin’s own advice to buyers is to consider offering below asking, or asking for concessions, on homes that have sat that long.
• The price has already been reduced. A reduction tells you the seller is adjusting to the market.
• The inspection finds something real. A documented roof, HVAC, or drainage issue is the most accepted reason for a credit. My guide to inspections and appraisals explains what each report covers, and why Central Jersey home deals fall apart after signing shows where inspection negotiations go wrong.
• The seller has a deadline. A seller who has already bought another home often values a firm closing date more than the last few thousand dollars.
• It is late in the season. Fewer buyers are looking between Thanksgiving and New Year.

And when not to: on a new, well-priced listing in a sought-after school zone with other offers on the table. There, a clean offer wins. I cover that in What Makes a Strong Home Offer in Central Jersey. Paying cash changes your leverage again; see buying a home with cash in Central Jersey.

For Sellers: What to Be Ready For

Concessions are still uncommon in our region, but more buyers are asking. Decide in advance what you would agree to.With mortgage rates above 7%, a buyer who asks for a closing cost credit or a buydown is often solving a real cash or payment problem, and a modest credit can be what keeps a deal together. Set a concession budget before you list, and consider handling known repairs up front so the inspection brings fewer surprises. My guide on repairing before listing versus selling as-is walks through that decision.

Frequently Asked Questions

What is a seller concession?

A seller concession is something the seller provides that reduces the buyer’s overall cost without changing the contract price. Common examples are a credit for repairs, a credit toward closing costs, paying to buy down the buyer’s mortgage rate, or a home warranty.

How common are seller concessions in New Jersey?

Less common than nationally. Redfin reported concessions in 44.7% of U.S. home sales in the three months ending in August, but only 5.7% in the New York metro area, the closest market in its analysis to Central Jersey. Results vary by town, price range, and how long a home has been listed.

How much can a seller contribute toward my closing costs?

It depends on your loan. Conventional loans on a primary residence commonly allow 3%, 6%, or 9% of the price depending on your down payment, FHA loans commonly allow up to 6%, and VA loans limit certain concessions to 4%. A credit also cannot exceed your actual closing costs. Confirm the limit with your loan officer.

Is it better to ask for a lower price or a seller credit on an Edison home?

It depends on what you need. In this article’s example, $10,000 off the price lowers the monthly principal and interest by about $53 and the cash to close by about $2,000, while a $10,000 closing cost credit lowers the cash to close by about $10,000 and leaves the payment unchanged.

When is the best time to ask for a concession in Middlesex County?

When you have leverage: the home has been listed for more than a month, the price has been reduced, the inspection has found a documented problem, or the seller has a deadline. On a new listing with multiple offers, a concession request usually weakens your offer.

Who can help me negotiate seller concessions in Central Jersey?

Work with a local agent who checks each listing’s days on market and price history before writing the offer, and who knows the loan limits on seller credits. Jasmine Tsui of Weichert Realtors in North Edison has 16+ years in real estate and 200+ closed transactions, serves Edison, Metuchen, East Brunswick, South Brunswick, and Piscataway, and negotiates in English, Mandarin, and Cantonese. Call or text 201-920-5825.

Looking at a specific home and wondering whether a concession is realistic? Send me the address. I will pull the listing history, including days on market and any price changes, and tell you what I would ask for and how I would word it. Call or text (201) 920-5825. I am glad to help in English, Mandarin, or Cantonese.

Concession figures are from Redfin, published in September, and describe metro-level and national data, not any individual town or property. Seller contribution limits are general guidelines for common loan programs as of mid-October and are subject to change and exceptions; confirm with a licensed loan officer. Payment examples are illustrative principal-and-interest calculations only. This article is general educational information, not mortgage, financial, tax, or legal advice. I am a licensed real estate agent, not a loan officer or attorney. Jasmine Tsui, Weichert Realtors, 123 Lincoln Hwy, Edison, NJ 08820, (201) 920-5825. NJ real estate license #2075070. Equal Housing Opportunity.