A relatively new solution to buying or selling a home has arrived. A real estate transaction
typically can run anywhere between a month to a year, or never sell at all. A new group of
buyers has found a way to sell your home fast without all the hustle and bustle. This new group
of buyers are called iBuyers. iBuyers are companies and / or investors who come in and make
a single offer on the home to buy it as is. The “i” in iBuyer stands for instant. The transaction is
usually a cash offer, and they take all the responsibility off of you of selling the home such as
marketing and finding the buyer. iBuyers are different than your typical buy and flip, as many
will offer to buy the home from you at market value. How these new buyers have carved a little
niche for themselves is remarkable.
The real estate world is taking notice of these new kind of buyers and many businesses or
brokerages are adding a similar service to their business plan. This is a dramatic shift in how a
person can buy or sell a home, but not all markets are picking it up just yet. The process relies
on a reliable or predictable housing market. For example, the model relies on homes that are
more cookie-cutter to help with predictable values that are being offered. Markets like Chicago
where market values of a home change as close as your next door neighbor, offer a little more
of challenge for this type of business plan. But the strategy works well in markets like California,
Arizona, or Texas where housing can be found to be more similar and offers are able to made
faster and are true to market value.
A typical buy and flip looks to purchase a home, make necessary renovations and look to resell
the home at a price point that is higher than their initial investment on the home. An iBuyer has
a different strategy. Their business model focuses on quantity. Their value is in giving the home
owner top dollar for their home so they can move on. Even if they make a few cents on the
dollar, their volume is so huge, they still make a profit.
Where the iBuyer model works great is when the seller is faced with a life change that needs
them to move now. Whether you are having to relocate for work, getting divorced, you’ve
inherited the property, or just want to get rid of a rental property and do not want the bother of
listing the property, for some, this process is a fast way to get cash for your home at what the
market value would be. With some companies, the process is as fast as submitting a request,
receiving an offer, accepting / reviewing the offer, preparing for a home evaluation, and agree on
a closing date.
“We buy housing” scams are valid, so always be sure you are working with a reputable
company when working with an iBuyer. Overall, iBuying is still in its growing phase and isn’t
available everywhere, but it is growing fast in markets that support its business model. With
many businesses picking up this type of business model, look around near where you live and
learn more about it. The real estate market is really evolving to the demand of its customers
and this just one of the new ways sellers and buyers have to make the transaction easier.
Recent Comments