You may have heard about ibuyer. i-buyer for real estate is an attempt for companies to make for instant offers to home sellers.
It’s marketed based on simplicity and convenience: no commissions, no repairs, fast closing, all cash offers. Often these companies target sellers in a divorce, estate sale, out of town owners, absentee landlords, etc. Think “we buy houses” on a grand scale. They do make you an offer but at what cost? Often fair market value can only be determined by bringing a property to market.
I get the appeal. A seller can be overwhelmed and this scenario sounds attractive, but look at the facts. Inventory is down across the U.S. That means the same number of buyers are competing for homes in very low inventory housing market. Now, is your best chance to get multiple offers and a great price.
Convenience: The average days on market in our area is 30. Many homes sell with multiple offers in the first week, buyers are waiving contingencies. You will hear “cash offers” Here is a little secret. All offers are cash. The seller is always paid in cash. (Who are they trying to fool?)
No Commissions: So, where is the catch? Here it is……these ibuyer programs typically charge a transaction fee of 7-13%. That’s more than a real estate commission. Plus, the seller still does not get a fiduciary, a professional representing them in the transaction.
No repairs: So if a property will sell for more after repairs, why not make the repairs. There are all kinds of statistics that show updated properties and staged properties sell for more money and in a quicker time frame. Don’t have the funds to cover repairs? there are lots of companies that will do the repair work for you now, and be paid at closing.
Quick Settlements/Close quickly: This is so misleading. Reason is most banks are ready to close loans in 14 days….just what the ibuyers are offering.
Realtor dot com says “people who sell their home to an iBuyer often end up paying for that convenience, netting less money.”
These type of programs allow for a savvy seller to make a lot of offers. The hope is enough sellers will say yes to the below market price offer. Sellers will still pay a fee. Sellers will have no one representing their interests. What could be wrong with that?
Alternatively, what does it cost a seller to interview a local Realtor? nothing! it’s free!
Get in touch with me.
Norm Odeneal www.CALLNORM.com “When do you plan on moving?”
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Licensed Realtor in Virginia “Your Local Real Estate Expert”
KW Metro Center –703-587-0945 #1 Real Estate Sales Office in Arlington
2101 Wilson Blvd. Suite 100 Arlington, VA 22201 7032246000
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*Buying or selling in another city? Family or friends buying or selling real estate? I know the best of the best in every city in the U.S. Would you be open-minded to interviewing them for your next purchase or sale?