Do iBuyer Firms Really Save You Money

Selling as many homes as we do provides us with plenty of stories involving these transactions. Some are humorous, crazy, shocking, exciting, and enlightening. This article goes under the category of “enlightening” and our hopes are you take it to heart.

As some of you know, iBuying has become a new trend over the past few years. These are companies which claim they will purchase your home, pretty much sight unseen, with a minimal amount of investigations, for full market value, and allow you stay in the home as long as you want before having to move out (called a seller leaseback). On the surface, this all seems like a sweet deal, right!

“You mean I can sell my house without paying realtor fees? I can get top dollar for my house without worrying about random people walking through my home? I can put money in my pocket but not have to move for 6 months? That sounds amazing!!!”

The iBuying companies have done a great job of pitching the “advantages” of using their services, but is the deal really as sweet as it sounds? Are you really getting top dollar for your home? Are you really eliminating all “the fees” when you hire these companies? Is this a viable option you should consider?

Most people know whenever something sounds quick, easy, and profitable, it’s probably too good to be true. That goes for selling homes too. We recently sold a home which allowed us to evaluate how

How We Became Involved In This Transaction

A homeowner called us wanting to sell his home. He’d gone online to one of the big iBuyer companies. After some discussions, the company said they’d pay in the neighborhood of $500,000 for his house and let him stay in the home for 9 months after closing.

Although he loved the idea of selling quickly without the hassles of being on the MLS (showings, open houses, contract negotiations, etc) he wisely decided to talk with a traditional Realtor before making his decision. The Grisak Group had represented some friends of his in the past and done a good job which is why he called us.

Our Conversations With the Seller

When we met with the seller, he was very upfront with us about his intentions. He told us he was planning to sell his home to the iBuyer company but wanted our opinion before making the final decision.

During our meeting, we discussed the condition of his home, the state of the market, and the offer he received from the iBuying company. After reading the fine print of the Ibuyer offer, we pointed out his walkway money wasn’t really $500,000. It would actually be over $10,000 less.

We ran a comparable marketing analysis using the area sale comparables and our analysis pointed to a price of around $575,000, or about $75K more than the Ibuyer firm offered. Because we felt it would be a very high demand home, we told the seller he might expect a large number of showings and there was a potential for multiple offers. If so, that would give us leverage in negotiating a longer seller leaseback period for him. The seller felt confident with our opinions and decided to let us list the home instead of taking the ibuyer offer.

The End Result

We made the home live on a Thursday, and by Sunday evening had 7 offers, all for over asking price. We moved very quickly through the contract negotiations and locked down the buyer by Monday evening.

The entire process from the initial listing of home to closing only took about three weeks. The seller was granted a free leaseback which not only saved the seller lease rental payment, the leaseback term also worked well for his schedule.

All said and done, the seller profited roughly $100,000 more by hiring us than going with the iBuying company.

Of course, this is one isolated incident and also our first opportunity to compete directly with an Ibuyer firm. We can’t promise such a dramatic difference in every transaction, but before you make the decision to work with any Ibuyer firm, we recommend you at least interview a local Realtor who really knows the market. If you don’t, you might be leaving lots of money on the table.

If you’re in the market to buy or sell a home my contact information is above and I’d love to visit with you for a free, no cost and no obligation appointment.