Housing Market Shifts: Seller Concessions Near Record High as Buyers Gain Leverage

The Power Shift in Housing: Buyers Gaining Ground in 2025

The pendulum of the housing market has swung decisively toward buyers, with 44.4% of U.S. home sellers offering concessions during the first quarter of 2025. This figure approaches the all-time high of 45.1% recorded in early 2023 and represents a significant jump from 39.3% during the same period last year.

This trend reflects a fundamental shift in market dynamics, driven by a perfect storm of conditions: stubbornly high home prices, elevated mortgage rates, and growing economic uncertainty. Additionally, housing inventory has reached a five-year high, giving buyers unprecedented options and consequently, stronger negotiating power.

According to Redfin's comprehensive analysis of nationwide transactions, these concessions encompass various financial incentives beyond simple price reductions—including repair credits, closing cost assistance, and increasingly popular mortgage-rate buydowns. The data covers rolling three-month periods from 2019 to present, providing valuable historical context for current market conditions.

Seattle Leads Nation with Dramatic Increase in Seller Incentives

The Pacific Northwest has become the epicenter of this buyer-friendly shift. Seattle home sellers now provide concessions in an astonishing 71.3% of transactions—the highest rate among major metropolitan areas analyzed and nearly double the 36.4% recorded just one year ago. This represents the largest year-over-year increase (34.9 percentage points) among all markets studied.

Portland follows closely behind with concessions appearing in 63.9% of transactions, jumping 14.2 percentage points from the previous year. Other markets showing significant increases include:

• Los Angeles: 56.1% (up 11 points)

• San Jose: 16.7% (up 10.6 points)

• Houston: 46% (up 6.2 points)

Stephanie Kastner, a Redfin Premier agent in Seattle, notes a distinct pattern: "Concessions have become standard for condos and new-construction townhomes due to rising HOA fees and insurance costs. Builders particularly prefer offering incentives rather than reducing list prices to maintain property valuations in their developments."

Why Some Markets Buck the National Trend

Not all markets follow the national pattern of increasing concessions. New York represents the most dramatic exception, with only 5.5% of transactions involving seller incentives—a substantial 15.7 percentage point decrease from the previous year and the lowest rate among all metropolitan areas studied.

Other markets showing significant decreases include:

• Miami: 33.8% (down 13.1 points)

• San Antonio: 44.4% (down 10.9 points)

• Tampa: 33.9% (down 9.2 points)

• Phoenix: 51.2% (down 3.5 points)

This counter-trend appears most pronounced in Florida and Texas, where market cooling began earlier. Sellers in these regions have had more time to adjust initial pricing strategies, eliminating the need for post-listing concessions. This reflects a more realistic approach to property valuation from the outset.

After New York, the markets with the lowest concession rates are San Francisco (14.9%), San Jose (16.7%), Boston (18.7%), and Chicago (26.4%).

Beyond Concessions: Multiple Negotiation Tactics Signal Buyer Advantage

The increasing frequency of seller concessions tells only part of the story. Many sellers are employing multiple strategies simultaneously to secure buyers:

• 21.5% of homes sold in Q1 2025 featured both concessions and a final sale price below the asking price (up from 18.5% a year ago)

• 16.2% included both price cuts during listing and concessions (up from 13%)

• 9.9% utilized all three approaches: concessions, price cuts, and below-asking final prices (up from 8%)

These statistics reveal sellers' increasing willingness to negotiate on multiple fronts, further evidence of the market's shift toward buyer advantage.

Deal Cancellations Reflect Persistent Economic Anxiety

Economic uncertainty continues to undermine buyer confidence, with approximately 52,000 home purchase agreements canceled in March 2025—representing 13.4% of homes that went under contract that month. This marks a slight increase from March 2024 and stands as the third-highest March cancellation rate since record-keeping began in 2017.

The highest cancellation rates appear in Fort Worth (18.4%), Orlando (18.7%), and Las Vegas (18%), reflecting regional economic concerns. Meanwhile, the lowest cancellation rates occur in Nassau County, NY (4.8%), Montgomery County, PA (5.7%), and Boston (7.8%), suggesting stronger buyer confidence in these markets.

Market Insights: Expert Perspectives on Current Trends

Why are sellers offering concessions instead of simply lowering prices?

According to Portland-based Redfin agent Chaley McVay, "It's often a win-win strategy. Buyers get financial assistance where they most need it—whether for closing costs or rate buydowns—while sellers maintain their desired sale price on paper, which is psychologically important to many homeowners who purchased at market peaks in 2021-2022."

Are concessions becoming more substantial than in previous market shifts?

Yes. McVay notes, "Buyers previously requested minor concessions for repairs or modest closing cost assistance. Today's negotiations involve more significant financial relief—including extended mortgage rate buydowns and even coverage of HOA fees for several months. These are substantial financial commitments from sellers designed to make purchasing viable for buyers facing affordability challenges."

How should buyers approach negotiations in this market?

The data suggests buyers should enter negotiations with confidence, particularly in markets with high concession rates like Seattle, Portland, and Atlanta. Requesting seller assistance with closing costs or rate buydowns may prove more successful than aggressive price reduction attempts, as these concessions address affordability concerns while allowing sellers to maintain their desired sale price.

Will this trend continue through 2025?

Market indicators suggest the buyer advantage may persist throughout 2025, particularly if economic uncertainty continues and inventory levels remain elevated. However, regional variations will likely grow more pronounced, with some markets potentially returning to seller advantage while others continue to favor buyers.

As the housing market continues evolving through 2025, both buyers and sellers must adapt their strategies to navigate this shifting landscape effectively. Understanding regional variations and leveraging data on concessions and cancellations can provide valuable negotiating advantages for all parties involved.