Tech companies disrupting resale Real Estate

Web-based real estate companies are changing the real estate game. There are quite a few on the internet now and we are going to take some time each week to discuss these companies and what they can do for you. As a buyer or seller it can be confusing and overwhelming. Each week I am going to give my honest evaluation of a new company. These are in no way sponsored posts and the goal is to really dig into the companies out there so I can give you an informed, educated experienced evaluation.

This week I am going to start the conversation by explaining a few terms so that we can move forward together in this process.

The first term I want you to understand is ibuyer. I buyer stands for Instant BUYER. This is a real estate company that buys homes from sellers who sign up online. After receiving a description of the property, the iBuyer makes an offer to the seller within a couple of days, which may even include the cost of moving. There are some large companies doing this in quite a few states right now. The most notable ones are: Zillow (they are in 10 states as of now), Opendoor who recently acquired Offerpad making them a very large player- they are in 11 different states. Knock is a third ibuyer company. They focus more on the trade-in model.

So how does this work? Well, you as a homeowner can fill out an online form and get an offer a day or two or three later from the iBuyer, including the price the iBuyer is willing to pay for the house. Then, depending on the company you set the timeframe on when you want to close escrow. Some companies will hold the price for up to 6 months! There are some real positives to this model- no showings, no stress about a loan getting approved or a buyer falling through. The cons- it does cost a bit. You will receive a lesser value for your home than if you sold it yourself. I will break that down more specifically as I evaluate the companies one by one.

Now that we’ve discussed the ibuyer let me tell you about discount brokerages. These are going to be Real Estate Brokerages with agents in your area that will list and sell your home for a discounted rate. Typically 1% or a flat rate rather than the traditional agent who would charge 3%. Large companies doing business this way are Redfin, Homebay, Reali, Homie, Purplebricks just to name a few. These are exciting tech-based real estate companies that are streamlining the process and passing the savings on to the homeowner. I will evaluate each of these companies and more that pop up from both a Realtor’s perspective and a homeowner’s perspective. Over the next few weeks be on the lookout for a great cheat sheet that evaluates the costs vs. the services each of these companies offer. These companies are changing the industry and it is my hope that instead of fear them we can understand what they offer and make the best decision on if that's the right fit for you and your home. Make sure you subscribe to our email list so you don’t miss a post. I will be sending out new notifications when I evaluate new companies and I will have that cheat sheet emailed out as well. This will be a great resource to help determine if one of these companies would be a good fit for you.