There has been a lot of hype going on around this newer real estate technology trend being referred to as iBuying. But, what does this mean to you as a homeowner thinking about selling? First, what exactly is an iBuyer? It is a company that will make you an offer on your home typically within minutes, sight unseen, based on their proprietary valuation model. Should you choose to accept their offer, you can close within as little as a few days. The iBuyer touts this type of selling experience as quick and easy. This sounds awesome, but what’s the catch? When selling to an iBuyer you are selling to a company or investor. Investors like to make money, and the quick and easy experience for Sellers does not come cheap. The iBuyer will typically charge a full commission, plus take a discount to the fair market value on the home in order to compensate for the risk they are taking to provide the Seller with “instant liquidity.” So, when would you consider selling your home this way? A few examples are if you need to move quickly to relocation for a job, you are in a distressed financial situation, or you have found your next home and want to act quickly. While the iBuyer provides the convenience of selling quickly, matching expert investors against Sellers is not always in the best interest of the consumer. Zillow recently explained that 90% of Sellers who engaged its “Instant Offers” platform decided against the iBuyer offer. If 9 our of 10 consumers pass, the pricing cannot be that compelling. Having choices is good, but a home is generally your largest asset, so you may want to consult a real estate professional that you know and trust before engaging in “iSelling.”
iBuyers: Is the convenience worth the cost?
Feb 20, 2019