Many buyers who have spent 2026 waiting on a cheaper monthly payment have largely been waiting on one variable, which is the direction of mortgage rates.
That wait grew slightly more expensive last week, when Freddie Mac’s Primary Mortgage Market Survey, as of July 23, put the 30-year fixed-rate mortgage at 6.58%, up from 6.55% the previous week. Rates are still running below the 6.74% average recorded at this point last year, though the weekly direction has not cooperated with anyone timing a purchase around cheaper financing.
On Monday’s episode of the BiggerPockets Real Estate Podcast, chief investment officer Dave Meyer and guest Brian Waters spent most of the conversation on investment real estate, though the mechanism they described is running underneath the wider housing market as well. Waters, a Los Angeles fire captain who has built a portfolio of 20 rental properties while working full time, described what the companies selling to him are currently putting on the table.
“So right now they’re buying the rates down to five and a half percent or lower for you at no cost,” Waters said.
The July 23 rise is not the news homebuyers want, but discounts in the housing market still exist, they just often come from sellers who need a deal to close. And while Waters and Meyer discussed an investor-specific example, such buydowns are included within broader seller concessions.
What BiggerPockets’ Dave Meyer said about seller-funded rate buydowns
Waters described buying remotely owned rentals from turnkey providers that prepare each property and arrange ongoing management before selling it to an investor. The discounted rate is one of several incentives those providers are offering.
“They’re giving us deals on the property management fees,” Waters said. “They’re also giving us rent guarantee for the year.”
The rent guarantee is a recent addition, and Waters said it exists because the companies know things can often go wrong after a sale closes. Meyer traced the concessions back to how the companies offering them make money in the first place.
“If you think about the way that a turnkey provider, one of these companies operates in their business model, they need to move deals,” Meyer said. “They rely on velocity and volume of deals to make money.”
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In a rate buydown, someone pays the lender money up front at closing, and in exchange the lender charges a lower interest rate, either for the first couple of years of the loan or for its full term. The cost is real and somebody covers it, but when that somebody is the seller, the buyer collects a smaller monthly payment without paying for the reduction. Sellers whose income depends on closing deals quickly have a reason to write that check that a homeowner who can afford to wait for a better offer usually does not.
Unlike a market-wide rate decline, a seller-funded buydown depends on the terms one seller is willing to accept. Redfin’s concessions data show that seller-paid costs are common, and while they do not isolate mortgage-rate buydowns, time pressure can be leveraged by everyday homebuyers as well.
What the incentive shift could mean for homebuyers
Meyer drew the comparison to new construction himself, where builders face the same pressure to keep inventory moving.
“In the same way, if you look at what’s going on in new construction with builders right now, they’re offering incentives too because their business model relies on velocity,” Meyer said. “They need to keep moving stuff. And so that presents a great opportunity.”
The National Association of Home Builders reported that its July sales-incentive measure was 63%, the 16th month at 60% or more. Thirty-seven percent of builders cut prices, and the average reduction was 6%. Separately, the Census Bureau reported 9.3 months of new-home supply in June at the current sales pace.
Ordinary sellers have been doing a version of the same thing. Redfin reported that concessions were involved in 46.2% of the sales it tracked for the rolling period through May, a record for that month. The comparable prior-year figure was 43.1%.
Redfin’s definition covers seller-funded expenses other than a reduction in the home’s listed price. Its examples include credits for repairs or closing costs and payments used to buy down a mortgage rate. The report says nearly half of the tracked sales included a concession, but it does not say every concession was negotiated by the buyer.
A buyer negotiating an ordinary resale home in that environment can ask a seller to fund a rate buydown the same way the companies selling to Waters fund his.
However, Meyer did flag a tradeoff in this approach.
“The trade-off that you get with a turnkey provider is that a lot of the equity growth of doing a renovation yourself, that opportunity is gone because they’ve done that and they’re selling it to you hopefully at a fair price,” Meyer said.
A seller-funded buydown lowers the buyer’s payment without reducing the agreed purchase price. If the alternative were a lower purchase price, the buydown would produce a smaller monthly payment but a larger opening loan balance than that lower-price deal.
What has not changed is the rate market. A seller-funded buydown does not alter the national survey, but it does change who covers the cost for one transaction, which can matter for the right buyer.
Key takeaways for 2026 homebuyers
- Mortgage rates moved higher again in July: Freddie Mac’s July 23 survey put the 30-year average at 6.58%, compared with 6.55% on July 16 and 6.49% on July 9. The latest figure remained below the 6.74% reading from a year earlier.
- Nearly half of recent home sales included a seller concession: For the rolling period through May, Redfin’s concession measure was 46.2%, versus 43.1% in the prior-year period. Its definition includes mortgage-rate buydowns paid by the seller.
- Turnkey providers offered Waters payment relief through buydowns: Waters said the providers had covered the cost of reducing his rate to no more than 5.5%. He also described discounted management fees and a one-year rent guarantee.
- Builder incentives and new-home supply came from separate measures: NAHB’s July incentive figure was 63%, with the measure at 60% or more for 16 months. Census separately reported 9.3 months of June supply and a $398,300 median sale price for new homes.
- A buydown does not reduce the agreed purchase price: Meyer’s equity warning concerned turnkey rentals. More generally, a seller-funded buydown changes the buyer’s payment terms without itself lowering the price of the home.
Related: Americans face uncomfortable decision after housing market news
