4 Reasons Why Selling Your Home To An iBuyer May Net You Less
OfferPad. Zillow Offers. OpenDoor. You might've heard one or all of them, or perhaps came across the term "iBuyer." Basically, an iBuyer is a company that uses technology to assess home values and come up with an offer instantly, making a profit in service fees charged to the seller and subsequently, the difference between how much they bought and sold the home for.
For a homeseller, iBuyers represent a more convenient and faster way of selling their home with the elimination of the back and forth between seller and buyer. But selling quicker with an iBuyer doesn't necessarily mean you net more; in fact, you might be netting less. Here are four reasons why you might be selling for less with an iBuyer compared to having a real estate agent sell your home the traditional way.
1. The cost of convenience
We've mentioned earlier the service fees charged to the seller by the iBuyer for buying their home. The total of these fees can fall between 8 and 9% but for riskier properties or markets, they can be up to 12%. On the contrary, a real estate agent's listing commission is on average just 6% of a home’s sale price.
2. Fair Market Value (FMV)
You might already have the idea beforehand but to make a profit, an iBuyer must purchase a home a little below FMV. Conversely, an agent lists a property at or above FMV. So if you're looking to maximize your profits for the sale of your home, this comparison is something to consider when making a decision whether to sell to an iBuyer or list with an agent.
3. No Open Market Listing
Did you know that when you choose to sell your home with an iBuyer, your home isn't listed on the open market? With low inventory and low interest rates fostering a steady but intense demand, the current real estate market favors homesellers and listing on the open market will only boost your chances of netting more.
4. No Negotiations
Home inspections are also utilized by iBuyers but did you know that the cost for any repairs are taken out of the cash offer base price with no room for negotiations? That's less money for you to gain from selling your home whereas when you list with a real estate agent, you're able to make decisions when it comes to addressing a buyer’s repair requests.
Another thing to keep in mind is that at the end of the day, the iBuyers need to make a profit for the investor which necessitate inflating the price of the home. On the other hand, realtors are expected to represent the best interests of their clients in line with their Code of Ethics and Standards of Practice. While iBuyers rely on technology to speed up the homeselling process, a qualified realtor brings local knowledge and expertise to the table when it comes to helping you net top dollar in the soonest time possible. Want to make the best of this crazy, exciting seller's market we're experiencing right now? Call 480-415-7616 and let your East Valley local specialists, The Shanna Day Team, help you cash in on the equity of your home ASAP!
If you have any topics or questions you would like answered, contact The Shanna Day Dream Home Team - we’ll find the answers for you!
Shanna Day Dream Home Team
Keller Williams Realty East Valley