If you’re thinking of selling your home to an iBuyer, there are several pros and cons to consider before you move forward. 

The pros:

1. Convenience. By selling to an iBuyer, you won’t have to fix up, repair, stage, or show your home. You also won’t have to deal with deal with waiting for your home to sell as it sits on the market, which leads me to my next point…

2. They’re a guaranteed buyer. You’ll face no uncertainty about closing on time or whether you’ll close at all. Also, you won’t have to deal with any contingencies—financing or otherwise. iBuyers have their own money that they use to buy from you directly. 

3. It will be a quick transaction. Because it’s an all-cash purchase, you can expect the closing to take place in two or three weeks, tops.

“Remember to weigh the net proceeds you’ll receive instead of the sale price.”

The cons:

1. High fees. The tradeoff for all your convenience is high transaction fees, which range from 7% to 11.5%. In a traditional real estate transaction, your brokerage fee is between 5% and 6%. 

2. Uncertainty in the offer price. When these companies make you an offer, the final price is subject to inspections and further approval. When you go under contract with them, you may have a lot of contractors show up at the home asking you to make certain repairs or adjust the sale price. With that in mind, you should expect the final sale price to be much different than the original offer price. 

3. Loss of equity. Again, in exchange for all that convenience, you’ll probably sell your home for less than it’s full value. 

At the end of the day, whether you’re selling to an individual investor or a company like Zillow or Offerpad, the best thing you can do for yourself is shop around to find the best quote. Also, remember to weigh the net proceeds you’ll receive instead of the sale price. Even if you’re offered a high sale price, there may be transaction costs you’ll have to pay that could eat up your equity. 

As always, if you’d like to talk more about this topic or you have any other real estate questions I can answer, don’t hesitate to reach out to me. I’d love to help you.