[REN #712] iBuyer (E-Wholesaling) Competition Heats Up

Picture of phone with image of bedroom for Real Estate News for Investors Podcast Episode #712

The iBuyer marketplace is heating up. Home sellers seeking cash offers from instant buyers, like Offerpad and Opendoor, can now compare offers from several iBuyers with new comparison tools. The iBuyer field is expanding so rapidly, it’s hard to keep up, but these new tools could help sellers organize available offers and find the best prices.

iBuyers are like powerhouse flippers. They seek to simplify the process of buying and selling by making quick cash offers, usually within 24 hours, and then closing quickly with online paperwork. The iBuyers make any needed repairs on the homes, and then put them up for sale.
 

Zavvie’s Offer Optimizer

This last week, Zavvie introduced what it says is the first national iBuyer instant offer comparison tool. The Boulder, Colorado, company said in a press release that home sellers can use the Offer Optimizer tool to easily compare offers from leading iBuyers including Offerpad, Opendoor, Zillow Offers and Redfin Now. (1)

Zavvie’s CEO, Lane Hornung, says of this new service, “Instant offers are the biggest thing to happen to real estate since Zestimates.” She says, “Zavvie puts instant offers on overdrive with Offer Optimizer, ensuring sellers squeeze every last dollar out of their home sale.”

The company says, its Offer Optimizer operates in any major metropolitan area where instant offer activity is taking place. It provides offer comparisons from a national iBuyer, a local iBuyer, and the open market to help sellers make a more informed decision. iBuyers typically offer less than what a seller would get on the open market, but they also provide a quick sale for people who don’t have time for a long drawn-out process.
 

HomeLight’s Simple Sale

HomeLight is another company offering an iBuyer comparison tool. It recently launched what it calls Simple Sale and also claims to operate nationwide. This tool gives sellers access to more than a hundred iBuyers including Opendoor, Offerpad, We Buy Houses, and Roofstock. Simple Sale General Manager, J.J. McCarthy said in the press release, “Through buyer relationships we’ve established in more than 40 U.S. markets, Simple Sale lets home sellers find the best iBuyer for any home on one platform.” (2)

HomeLight was founded nine years ago to help connect clients with local real estate agents, investors, and online resources. It added the instant buyer comparison tool in February of this year. The company also has offices in Phoenix, San Francisco and Seattle.
 

iBuyer Sphere Expanding Rapidly

Phoenix appears to be ground zero for iBuyers. Opendoor and Offerpad are at the forefront of this iBuyer wave. They started offering their services about four to five years ago out of Phoenix. They each currently have more than a dozen markets. The Seattle-based Zillow launched Zillow Offers more recently and Phoenix is one of its several markets. Redfin is expanding its footprint as an iBuyer but it doesn’t appear to be in the Phoenix area yet. It operates in Southern California and recently expanded to Dallas.

Realogy also came on board last year with an iBuyer program called CataLIST. As reported by Inman, the program will keep real estate agents front and center throughout the process. If clients want to take advantage of the iBuyer program, they simply work with the agent who will present them with a cash offer. The program is available to agents within the Realogy group including Coldwell Banker, Century 21, and Better Homes and Gardens. (3)
 

Revolutionizing the Sales Process

As the Orange County Register commented in an article about iBuyers — They want “to make trading in your home as easy as trading in your car.” And, competition is growing as iBuyers add more markets and more services to their programs.

Inman reports,  Zillow is testing self-guided home tours for home buyers with a “handful of homes in the Phoenix area.” The program is called “Tour it Now.” Buyers can tour homes with the Zillow app which offers directions to the property and unlocks the door. It will only work on homes that Zillow has bought through the iBuyer program and is selling — not other homes listed on its website.

Zavvie says, the iBuyer playing field is still relatively small with just .2% of all home sales in 2018. That’s about 12,700 homes. But as I mentioned, this field is growing quickly. Zavvie says that in Phoenix, where iBuyer activity is flourishing, 1 in every 20 sold homes are bought by an iBuyer company.

If you’re in a hurry to sell your home, it might be worth checking for any iBuyer programs in your area. And, if you own property in any of the 15 metros listed on our website, there’s a chance one of our property teams would be interested in purchasing it. You can reach out to info@realwealthnetwork.com for more information.

Links:

(1) Zavvie’s New Comparison Tool

(2) HomeLight Press Release

(3) Inman Article

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