Seller concessions are back in play in South King County in a way they were not during 2021 and 2022. Inventory has risen significantly year-over-year, which means buyers in the right situations have leverage they did not have two years ago.

Most buyers know concessions exist. Fewer understand exactly what they are, when asking for them makes sense, and when asking for them costs more than it is worth.

What Seller Concessions Actually Are

A seller concession is an agreement by the seller to contribute a defined dollar amount toward the buyer's costs at closing. The most common application is closing cost assistance - the seller agrees to cover a portion of the buyer's origination fees, title insurance, escrow fees, prepaid interest, or other closing costs.

Concessions can also take the form of a price reduction, a repair credit, or a rate buydown contribution - though each of these works differently and has different implications for the loan.

What concessions are not: free money the seller is handing over out of goodwill. In most cases, a concession is built into the offer structure. The purchase price may be adjusted upward to offset it, or the seller accepts lower net proceeds in exchange for the deal moving forward.

When Asking for Concessions Makes Sense

The case for asking is strongest when:

• The home has been on market for 21+ days. Sellers with sitting inventory are more motivated to make a deal work. A concession request on a home that went under contract in three days is a different conversation than the same request on a home at 45 days on market.
• You are cash-constrained at closing. If your down payment is consuming most of your liquid assets, an $8,000-$12,000 concession toward closing costs can meaningfully change your financial position after the transaction. Buyers who close with very little cash reserves are exposed - a concession that preserves that cushion has real value.
• The inspection revealed items the seller declined to repair. A credit in lieu of repairs is a clean resolution. The buyer takes the credit at closing and handles the work on their own timeline. This is often preferable to a repair agreement where the quality of the work becomes a dispute at the final walkthrough.
• You are using a rate buydown structure. A seller-paid temporary rate buydown - a 2-1 buydown for example - reduces your interest rate in years one and two. In a higher-rate environment, this can lower your initial monthly payment by $200-$400 depending on loan size. The seller funds it as a concession; the buyer gets meaningful short-term payment relief.

When Asking for Concessions Works Against You

Concession requests can signal weakness or create friction in the wrong situations:

• On competitively priced homes with fresh inventory. If a home is priced correctly and other buyers are circling, leading with a concession request tells the seller you are not their strongest option. In that situation, a clean offer at list price will win over a higher offer that asks for $10,000 back.
• When the concession requires a price increase that creates an appraisal risk. Lenders will not allow concessions that exceed actual closing costs, and if the purchase price is inflated to cover a large concession, the appraisal may not support it. An appraisal gap in the middle of escrow creates leverage problems for both sides.
• When the seller is already at their floor. A seller who has already reduced price once and is sitting at a number they need to net is unlikely to respond well to a concession request on top of a lower purchase price. Reading the seller's situation before structuring the offer matters.

How Concessions Interact With Your Loan

Lenders cap seller concessions based on loan type and down payment percentage. The limits are roughly:

• Conventional loan, less than 10% down: seller concessions capped at 3% of purchase price
• Conventional loan, 10-25% down: capped at 6%
• FHA loan: capped at 6%
• VA loan: capped at 4% plus actual closing costs

If the agreed concession exceeds these limits, the excess cannot be applied and the deal structure needs to be revised. Your lender should flag this before you are in escrow, but confirm it before you put the number in the offer.

How We Structure Concession Requests

The offer structure matters as much as the number. A concession built into a well-reasoned offer at a price the seller can accept gets a different response than a concession tacked onto a lowball as a second ask.

We look at days on market, seller motivation, competing inventory, and the buyer's specific cash position before deciding whether to ask, how much to ask for, and how to frame it in the offer. In the current South King County market, there are situations where concessions are genuinely available. Knowing which situations those are is most of the work.

Download our Buyer Guide for a full breakdown of offer strategy, closing costs, and what to expect at each stage of the transaction:

Download the Buyer Guide