Is “We Buy Houses” a Scam? Part One

You’ve seen the signs: We Buy Houses - Northern VA, We Buy Houses – DC, We Buy Houses – MD, from different companies that buy houses, all promising a fast cash sale for your home. Many home-sellers dismiss these signs as a scam, just another bottom-feeding real estate vulture trying to steal someone’s home (I should know, I have been called that and worse). While there are those shady investors who engage in unethical practices (bad apples can be found in any profession), most real estate investors are honest, everyday people just like you, trying to make a living helping homeowners move problem properties and by providing quality housing to homebuyers and renters in our communities.

I think the “steal my house” reputation comes from a miscommunication between investors and home sellers. True the signs say “We Buy Houses” but in fact we do more than that: we help solve a homeowner’s real estate problem. If your house is fully updated and in great condition, you have model tenants, no pressing financial distress and all the time in the world to sell, i.e. you have no real estate problems, then there is no room for a real estate investor to add non-monetary value to your situation, and our discounted cash offer seems like us asking you to “give your house away”.

On the other hand, if you just got relocated for work, you rented your old house out but your tenant just skipped out after not paying rent for 3 months but not before flooding the basement which is now covered in mold and needs thousands of dollars in repairs, and you live 3 states away and need to sell your old house so you can buy a new one, then you have a real estate problem that a real estate agent or first time homeowner probably cannot help you solve. So while the purchase price for your property may be discounted compared to retail prices, a real estate investor adds non-monetary value by solving a problem for home owners that they could not solve by themselves, often bringing a sense of relief and peace of mind to a home seller that you cannot put a price on.

So, no, “We Buy Houses” signs are not usually scams but that doesn’t mean you should not exercise caution when calling one. In Part Two, you will learn about some important considerations when calling a “We Buy Houses” sign.

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