Thinking about selling your home to an iBuyer? Be sure you know the true risks and rewards before you take the plunge.
iBuyers, or “instant” buyers, are online real estate investors who use digital tools to make instant cash offers on homes and resell them online. They handle the repairs, staging and home showings, allowing sellers to avoid the time and energy often associated with the traditional selling process. But that convenience comes at a cost.
The example here is for illustrative purposes. It allows sellers to compare how much they could make and spend working with an iBuyer versus a real estate agent to sell a home valued at $300K.
Remember, iBuyers purchase homes below Fair Market Value (FMV) and realtors list homes at or above FMV, so that is where the comparison begins. The costs and fees are calculated using industry averages that express a percentage of the home’s sale price.
In this scenario, the seller walks away with $39,900 less – that’s 14.7 percent of the sale price – by selling their home to an iBuyer. According to a new study by Collateral Analytics, iBuyers can cost sellers up to 15 percent of their home’s sale price.
While it is possible to sell quickly using a real estate agent, the traditional closing process usually takes well over a month. Selling to an iBuyer involves a faster transaction with minimal effort from sellers. It can also benefit sellers with busy schedules and time constraints, such as those who need to relocate for work or get cash fast.
So, that brings us back to the million-dollar question: Is selling your home to an iBuyer worth the cost? It depends on who you ask. The answer comes down to each seller’s situation and what they value more: cash or convenience. Working with an iBuyer offers convenience and a quick close, but when it’s all said and done, you’ll probably get a lot more by working with a REALTOR in the open market.
Before you commit to selling to an iBuyer, contact Kevin Majeski at Carpenter REALTORS to learn more about the pros and cons of selling your central Indiana property, so you can make an informed decision on what option is best for you.