Are you thinking of selling your home to an iBuyer?
By now, you have likely heard the term iBuyer. The commercials make it seem like such an easy way to sell your home. If you’re thinking of selling your home to an iBuyer . . .
There are so many tech companies that are entering the real estate business, and most are offering their own version of an iBuyer program.
Briefly, an iBuyer program targets those homeowners that do not wanna go through the traditional home selling process. They promote that you, the seller, will get an all cash offer and get to pick when you want to close. Sounds easy, right?
But let’s take a closer look. How does the program actually work?
Typically, the homeowner will go on to one of the iBuyer sites and will input all of the pertinent information about the home. You are also required to take pictures and upload them onto their website. Within 24 to 48 hours you will get an offer. Wow, that was easy.
Generally, the offer is low. They have to try, right? But let’s just say that you’re okay with their offer. The next step is that they will set up an appointment for someone local to come out and personally verify the information that you inputted is correct.
While there, they’re also gonna make a note of any repairs or updates that will have to be done to the home before they can re-sell it. Then they adjust their offer accordingly.
How do you think that’s gonna go? Are the odds better that they will raise your offer or lower it?
Again, let’s just say that you’re happy with their adjusted offer. Then you get to pick the best day to close and you will get your check and off you go. Wow, so easy! You get a check for that full offer price, right? Wrong!
Of course they need to make money, so what is it actually going to cost you? Each iBuyer program is a little different, but mostly the same. They claim that you don’t have to pay a commission, but there is a service charge. That is typically between 6% to 13%. Most require that you use their services like escrow and title. We don’t know what they charge for that.
Now, to be fair, you do not have to clean your house or declutter it and you get to pick the day to close, but at what cost?
The typical commissions in San Diego are about 5%, split between the list side and the buy side. Let that sink in for a moment. 5% or six to 13%? But at least you don’t have to clean your house, right?
Let’s recap. First they start with a lower offer price. Then you will pay anywhere from 6% to 13%, almost double what local agents charge, and your home is never exposed to all of the buyers in our market.
You will get an idea of what it could have sold for when they clean it up and put it back on the market at a higher price.
Here’s the best part. It’s a win win for them. Because if you don’t take their offer, they now have all of your information to turn around and sell to, you guessed it, realtors. So be prepared for your phone to start ringing off the wall!
Now, there may be a good reason for you to accept an all cash offer. That’s why here at One World Realty, we offer multiple ways to sell your home, including all cash with a quick close.
It’s your home, it’s your money and it’s your call. Do your homework.