At the upper echelon of residential real estate, developers will often throw in multi-million-dollar cars such as Rolls-Royces or expensive artwork to go along with a $100 million spec home.
The lavish add-ons are commonplace in the high-end market. But amid a market slowdown, they now seem to be trickling down into the more mid-tier markets.
Homebuilders, both large and small, are increasingly offering deal sweeteners as a way to lure potential buyers into a contract, the Los Angeles Times reported.
While the concessions are minor compared to the ones that took place during the last downturn, they still represent a shift from an inventory-strapped seller’s market to a buyer’s market.
In one case, a homebuilder in Valley Village offered to pay the lease on a Mini Cooper car if buyers agreed to buy the home. Other builders said they would bear the cost of upgrading the appliances.
Meanwhile, some builders are simply lowering the asking prices.
In December, 23 percent of builders lowered net prices, according to a survey by John Burns Real Estate Consulting. That’s a significant increase from last year, when only 4 percent offered price reductions.
Sales have also been dropping. In the three months ended November, sales in California decreased 12.5 percent compared to the same time last year, according to CoreLogic. Sales of newly built homes were down 2.5 percent year over year. [LAT] – Natalie Hoberman