Who's in Vegas? Has Zillow Instant Offer Affected You?

Question

Just curious whats going on in the Vegas market and how it's affecting wholesaling?

Jay Hinrichs · Answer

maybe its like publicly traded companies that have Billion dollar valuations but make no money :)

Bill B. · Answer

Opendoor and offerpad have been doing the same thing for 12-18 months. Gives you a nice base for anything you’re looking to sell.

Ask a realtor what they think they can net you after costs/commissions. And then compare to their cash out the door offer. With closing between 7-90 days your choosing. Gotta work well for people moving out fo state in “X” days for some reason. Or buying a new place in x days.

I tested them and they were about 3-5% below realtors net estimate, but that’s an estimate versus a cash offer. Like when an appraiser says a ring is worth $10,000 but won’t buy it from you for $5,000.

Jay Hinrichs · Answer

really.. I need to check that out...  usually when these things start they tend to over pay to get established.. thanks

Phillip Dwyer · Answer

I don't think this is about zillow just flipping houses.  They want to be a one stop shop.  They want to capture mortgage clients, pieces of the commission pie, ect.

Matt M. · Answer

Z's offer pitch is just to get premier agents in the door. If the client accepts a lowball offer, then they could still make money. The market is showing signs of finally shifting. Once it does, a lot of these "disruptors" will disappear.

Kyle Doney · Answer

Theres a podcast called Real Estate Disruptors that had Open Door on it as a guest. They are making a few grand a deal. Their profit margins are less than 1%.. Dont know how that is sustainable in this industry. Seems doomed to fail in any sort of market correction.

Tim Stover · Answer

@Jay Hinrichs yup I agreed.  75% of our inventory we come across are flips.  The only thing I know about in the Vegas market is that properties don't sit.

I really can't seem this being a solution for Zillow in the long run but only time will tell.

Jay Hinrichs · Answer

in other words they are not working the urban core … burnt out landlord homes that are a mess.. which are most of the wholesaler inventory in the rental dominated markets.

I can see vegas.. although its so competitive at certain price points in that market listing sell in a matter of days or hours.. so not sure what advantage these guys have..  But maybe I can build some new home communities and they can buy all the homes from me day one.. that would be super.. I would do that..

Tim Stover · Answer

@Jay Hinrichs They're competing with off market wholesalers here.  I believe their opening up their third marketplace in Denver in the next few months.  It's a bit confusing to me, their margins are very very small and I feel as though if they mess up on purchasing one or two deals then that will wipe out about 10 of their other deals.  In Vegas I think they bought around 50 houses last quarter.  From my understanding they purchase the house, stage them, then resell.

They aren't going after you typical wholesale deals, more so retail who doesn't want to go through the selling process.

Brian Ellis · Answer

@Jay Hinrichs I believe anyone trying to sell their home can go on Zillow and receive and compare instant cash offers from investors, like invitation homes, etc.

Who's in Vegas? Has Zillow Instant Offer Affected You?

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