The top-tier companies in the iBuying space strive to provide potential sellers with convenience and certainty. They provide sellers with competitive, all-cash offers without having to list or show their home.
By far the largest company in the iBuyer space is Opendoor, followed by iconic brands Zillow and Redfin who have made great strides in recent years to increase market share in the iBuyer arena. Other well-funded start-ups in the space include Knock, Offerpad and Perch. iBuyers are not active in every market but are expanding steadily.
A word of caution, some "flipping" companies have recently re-branded themselves as iBuyers - but these companies typically try to purchase for much less than market value. There are also a handful of aggregators who may assemble several offers on your behalf. The offers may or may not be honored by the iBuying companies and ultimately these companies may just be fishing for seller leads they can sell to Agents.
Contrary to some misinformation on the web, iBuyers strive to provide offers that are based on Fair Market Value. The 0ffers generally include a small deduction (usually under $10,000) for necessary paint & flooring updates, as well as any needed minor repairs.
How much do iBuyers Charge?
The offer includes a statement of the iBuyer's proposed fee which may range from 5%-13% (usually 6%-9.5%) and any other costs that the Seller may be responsible for. The fee is meant to approximate the costs a seller would generally incur in a traditional sale. The entire process is meant to be transparent and allow the seller to know exactly how much it will cost to sell.
Is there any charge to receive an offer?
iBuyers provide offers free of charge with no obligation. Once accepted, the seller may usually cancel at any time with no fees incurred.
Research! In addition to making use of the information and data on this site, there are multiple tools on the internet that allow you to compare the merits of various companies.
Do iBuyers cooperate with local Real Estate Agents?
There are many ways that local real estate agents may work with the various iBuyers and related Proptech companies. iBuyers generally pay full commissions to Buyer's agents when they resell the properties they have purchased through the MLS. iBuyers also pay commissions and finder's fees to local Agents when Sellers are already represented by a Listing Agent. Additionally, there are numerous opportunities to work with iBuyers and other Proptech companies as "in house" Agents, Listing & Selling Agents, Referral Agents and Showing Agents.
Obtain an offer from one or more iBuyers by going to their web-site, completing a seller-flow questionnaire with subject info and possibly uploading photos. Offers are generally submitted to the seller within a day or two.
Compare iBuyer offers to each other with special consideration to overall fees, repair costs, closing costs and net proceeds. Evaluate whether the headline offer price represents the approximate value of the property using a variety of tools.
Accept the offer or let it expire based on comparison of the offer price, closing costs and net proceeds with traditional sales channels keeping in mind that convenience and certainty may off-set slightly higher costs. If the offer is accepted by Seller, iBuyer will schedule an inspection to estimate needed repairs and minor renovation costs.
Schedule closing at your convenience. Most iBuyers will close quickly or delay closing to accommodate sellers who need to close on another property or wait until construction is complete. Delayed closings differ by iBuyer so confirm their delayed closing policy.
Main Players in the iBuyer Space
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