Today’s new real estate player is ‘institutional flippers’ more commonly known as the iBuyer, or ‘instant buyers.’ We have all seen the “We Buy Ugly Houses” or “We’ll Buy Your House for Cash in Seven Days” on the side of the road. Those signs usually come from independent flippers, but other more prominent recognizable brands like Zillow Offers, Offerpad, and Open Door are considered iBuyer’s. Wondering how they work? Read below:
A homeowner fills out the information about their house on the iBuyer website. The company sends them an instant offer within a day or two, and the seller can choose to accept or reject it. An iBuyer’s proposal promises that selling to them is a more straightforward, easier way to sell your home than a traditional sale. They say they are a quicker and more convenient way to sell a house because all the seller has to do is accept their offer, and the iBuyer will take care of everything else.
iBuyers have become aggressive. In some targeted markets, it’s been estimated 40% of homeowners have received offers from iBuyers before they so much as considered selling their homes. Are you wondering if this is the future? Is it worth it to sell to an iBuyer?
Professionally speaking, it depends on the situation. If you need to sell your home very quickly, it may be an excellent option to consider. However, you must consider the pitfalls of selling to an iBuyer.
Expect that an iBuyer will offer you much less for your home than it’s worth on the free market. In addition, but they’ll also tack on a service fee, and they will likely tie on a list of repairs. If you do not want to make those repairs, they’ll lower their offer even more.
It’s hard to know precisely how much sellers lose when they decide to sell to an iBuyer over a traditional sale. Still, according to the financial website Market Watch, the average loss for sellers is around 11%. Still, in some markets, it’s as high as a whopping 20%!
In the end, iBuyers aren’t going anywhere. They’ll likely continue to be a marketplace segment offering a quicker sale than traditional sales. If you are considering selling to an iBuyer, it’s prudent to do your homework. It should be no surprise that 90% of home sellers reject iBuyer offers.
Contact us at Vivid Realty for a complete market analysis on your home if you consider selling. We will analyze your property, give you a realistic view of what to expect regarding pricing and marketing time, and help you determine if it’s best to sell traditionally or to an iBuyer.