What are the risks of selling your home through iBuyer? by Briana Frazier.

What are the risks of selling your home through iBuyer

By Briana Frazier

An ibuyer is an instant buyer. It is a new strategy used when one wants to sell a home fast, and the selling process is usually more streamlined. The method of selling a home is generally associated with a lot of risks which include;

LOWER PROFITS

An individual selling a home through an ibuyer will likely make less profit. The reason is that ibuyer charges 6% to 8% depending on how long they think the house will take in the market. ibuyer generally buy a home at a discount because they also need to make profits. When one wants to sell a home quickly, it fetches lower profits. Home sellers who sell to ibuyers make 10% less profits than those who sell homes using traditional means.

THERE IS LIMITED AVAILABILITY

The method got into the market in 2013, and thus it is still new. ibuying is only practiced in selected cities of Atlanta and Phoenix, among others. ibuying firms buy homes that meet certain qualities and are decent, thus creating a limit for those who use the method. Additionally, ibuying is challenging because the buyers only buy ordinary homes with no special features such as fountains and pools. Also, sellers cannot sell a well-maintained historic home through an ibuyer. In addition, the method does not include a price tag for variables such as beautiful mountain views and beaches, depending on the home’s location. ibuying affects not only home sellers but also the firms involved in the process because, at times, they cannot estimate the accurate cost of selling the home after remodeling. ibuyer market is, however, relatively new in the market.

IS SELLING A HOME AT A DISCOUNT A GOOD IDEA

At the time, the ibuying companies buy a home at a price lower than it actually is or way below the seller’s listing price. An individual who wants to make a maximum profit does not benefit from the method, but a seller who does not have time to repair the home would opt to sell to an ibuyer. Other factors that lead to the lower purchase price is that ibuyer firms give an all cash offer and close the house within the shortest time possible. Further deductions depend on the home’s condition, leading to meager profits.

IBUYING IS A PURE BUSINESS TRANSACTION

The process involves selling the house to the firm concerned and vacating the premise. Sellers differ; some prefer to converse with a potential buyer before selling. Others would like to sell to a specific person—sellers lose power over their preference on selling when they choose an ibuyer. The companies buy the homes make repairs, and finally, resell them to an individual they find more suitable. The process is far different from selecting a real estate agent because, with traditional methods, the buyer and seller have a one-on-one conversation.

THERE ARE NO NEGOTIATIONS WITH IBUYING

Unlike using realtors, ibuying companies do not negotiate. On the other hand, realtors arrange the home price during the closing process. Buyers request lower prices and while sellers seek higher ones. Eventually, they agree on the right price to sell or buy a home. When an ibuying firm is involved, they usually value the accurate cost of a home and do not give room for bargaining. During such times, the seller typically has no power over their house.

THERE IS NO ROOM FOR RENTING

ibuying firms only deal with buying and selling of homes. An individual thus looking for renters does not use ibuying companies. However, looking for people to rent your home through realtors is possible. ibuying companies only buy houses, make necessary changes and resell to make profits. Another critical issue about ibuying is that it does not involve using an expert in the business. That is, there is no representative of the seller or the ibuyer. Only the two parties are invoved during the whole process; thus, an individual can quickly make mistakes since there is nobody to lead the parties.

IBUYING HAS UNCERTAINTIES, AND IT IS ALSO NOT INTERACTIVE

Sometimes ibuyers are selective and may decide not to purchase a given home. The truth is that most sellers consider themselves lucky when ibuyers select their home. Essentially ibuying is a non-emotional process and there are normally no face-to-face interactions, unlike traditional means, which make individuals feel more confident about themselves.

RECOMMENDATIONS

Generally, using an ibuying company might not be an excellent idea, from low-profit margin to non-interactive nature. Before one decides to sell a home to an ibuyer, one should first conduct various assessments as to whether the home is worth the price they give. Also, people research different ibuying companies and even seek reviews from people who once used an ibuying company. With the information in mind, an individual can make the right choices in the home selling process.