What is meant by "sales concession" in real estate?

Sales concession in real estate refers to a financial incentive offered by sellers to entice buyers, which may include reductions in price or other financial benefits to make the property more attractive. This can take various forms such as covering closing costs, offering home warranties, or providing allowances for repairs. The primary goal of a sales concession is to help facilitate a sale, particularly in competitive markets or when trying to move a property that has been on the market for an extended period.

Understanding the purpose of sales concessions is important for both buyers and sellers. Buyers can recognize value in the incentives offered, which can help them in their budget planning and overall affordability of the property. Sellers can use these concessions strategically to differentiate their property from others in the market, potentially leading to quicker sales.

The other options do not accurately define sales concessions. A discount for real estate agents is not related to the buyer-seller dynamic that sales concessions address. Fees charged by lenders pertain to financing and do not directly incentivize buyers regarding the selling price or terms. Legal obligations to share profits with previous owners are not common in sales transactions and do not relate to the concept of sales concessions at all.