Why are home sellers giving concessions?

Harper, your question contains a premise that has since flipped, and that flip is the whole answer. When you asked this in late 2023 the market did still look tight in a lot of places. It does not now. As of the three months ending May 2026, sellers gave concessions in 46.2 percent of U.S. home sales, up from 43.1 percent a year earlier, and the highest spring share since Redfin began tracking it in 2019. The driver is straightforward: nationally there are roughly 47 percent more sellers in the market than buyers. It varies enormously by metro. In Nashville the figure was 75.5 percent of sales. In New York City it was 2.9 percent. So the short answer to "why are sellers advised to give concessions" is that in most markets they now have to compete, and this is the tool that competes without the side effects of a price cut. That last part is the piece worth understanding, and it answers the deeper question you were really asking. Why a concession instead of just lowering the price? A concession does not change the recorded sale price. A price cut does. That matters in three ways. It preserves the comparable sale. If you drop your price by fifteen thousand, that lower number becomes the comp for every neighbor and for the next appraisal on your street, including yours if you ever refinance. A credit at the same price does not. It buys more for the buyer per dollar. Fifteen thousand off the price barely moves a monthly payment. Fifteen thousand applied to a rate buydown moves it a lot. With the 30 year fixed averaging around 6.69 percent in early August 2026, buying the rate down is where a dollar does the most work for the buyer, which means it is also where it does the most work for the seller trying to get a deal done. It solves the buyer's actual problem, which is usually cash to close, not price. Plenty of qualified buyers are short on the cash at the table, not on income. A closing cost credit fixes that directly. The common forms are a closing cost credit, a permanent rate buydown, a temporary buydown such as a 2-1 where the rate steps up over the first two years, and a repair credit after inspection. Two constraints to know if you are a seller planning this. Loan programs cap how much a seller can contribute, and the caps differ by loan type, occupancy, and down payment. Your buyer's lender will tell you the ceiling for that specific loan. Do not agree to a number before checking it, because an over-limit credit gets cut at underwriting and you renegotiate under a deadline. The appraisal still governs. A large concession on top of a price that does not appraise does not save the deal. If the house is genuinely overpriced, a concession is a bandage. The market is telling you something and concessions do not substitute for hearing it. For a Phoenix seller in 2026 specifically, the practical version of all this is: price to the current comparable sales, then hold a concession in reserve as your negotiating tool rather than leading with a high price you plan to discount later. I am Zoltan Peresztegi and I work in Los Angeles and the South Bay, so Phoenix is not my market, but I am glad to help you run a concession versus price cut comparison if you post the numbers, and I can connect you with a strong local agent in the Valley. Zoltan

Harper, simply put it is to move the house quickly. Keith Jean-Pierre Managing Principal The Dapper Agents Operations In: NY, NJ, FL & CA

Even in a market with low inventory and high demand, sellers are often offering concessions to help buyers manage affordability. With higher interest rates and rising home prices, many buyers are stretched thin—so concessions like closing cost assistance, rate buydowns, or repair credits can help bridge the gap and keep deals together. While sellers with low mortgage rates may not be highly motivated to move, that doesn’t always mean they have all the leverage. Today’s buyers are more cautious, and many homes still sit longer if they’re overpriced or need work. Concessions can make a home more attractive, create goodwill, and lead to a smoother, quicker sale—especially if the property isn’t turnkey or priced aggressively. It’s less about “giving in” and more about being strategic to reach the finish line in a market where affordability is one of the biggest hurdles for buyers.

Concessions are becoming more common due to several factors. First, rising interest rates have made homes less affordable for buyers, which can reduce the buyer pool. Offering concessions, such as help with closing costs or interest rate buy-downs, can make the deal more attractive and affordable for buyers. Additionally, homes may still sit on the market longer if they’re overpriced or in need of updates, so concessions can help sellers stand out and close the deal more quickly.

The main reason (in my area) is because home sales have slowed in comparison to the past few years. Price reductions and agent/buyer incentives are now part of the marketing. Sellers have reasons to move or sell (building a new house, moving to another area, relocation closer to family, divorce, death, etc) and in order to expedite a purchase contract (average days on market is in the months now) -- concessions/incentives are the first step towards enticing a Buyer to make an offer on their home.