@Mcb050032 wrote:
Appreciate the info. So would the Seller-Paid Buydown be still considered to reduce the net selling price? Thanks!
I don't recognize the term "seller buydown" or "temporary buydown". What exactly is happening?
In general, most concessions are treated as adjustments to the price, because they really are. Suppose the house is listed for $150,000, and the buyer says, "I can't play closing costs, let's make the price $160,000 with the seller paying $10,000 in closing costs." The sales price (as far as the IRS is concerned) is still only $150,000.
Or, suppose the house is listed for $150,000 but it's kind of run down and the buyer offers $130,000. The real estate agent says, "it would be bad for property values in the whole neighborhood to sell for $130,000. Why don't we sell for $150,000 but the seller gives the buyer a $20,000 allowance for repairs and improvements." In that case, the real selling price is $130,000.
