Unconventional Ways to Sell Your Home: What is an iBuyer?

In this episode we discuss unconventional methods of selling your home.    We receive questions from our clients all the time, curious about some of the commercials they see on tv about selling their home to Open Door, Offer Pad, and even Zillow in some cases.  We discuss what this looks like for you, the option of a second opinion, and 

Transcript

Speaker 1: 0:00

Hey guys, happy Thursday. It's Tia here with the NextView home professionals team. So hopefully you saw our short snippet that we're going to be talking about non traditional home sales. If you tuned into the show last week we were talking about tiny houses and we told you that we were dedicating the month of June to nontraditional ways to buy and sell real estate. So a lot of people have been asking us different questions about, what do they do when they're seeing companies like open door companies like offer pad when they're, seeing things from Zillow, what exactly are they supposed to do? So ultimately I'm telling people, you guys, the real estate landscape is changing a bit and you know, obviously we can still make traditional real estate sales where you put your house on the market, you have people come and look at it, you do showings and maybe you do open houses and you,you sell your home. In that what we, we would, most people would consider it as a traditional way to sell their homes. And typically in many cases, that's going to be where you're going to see the most amount of money on your home sale. But there are additional options that you can explore too. So today we're dedicating the show to talking about exactly that. Um, when I say the real estate landscape is changing, the first thing I think about is, Zillow. So, and the reason why I say that is in a lot of real estate professionals that I work with, they're probably like, why are you talking about this? Because it's kind of a, it's kind of a sore subject for a lot of people in our industry. But when I think about, you know, 10 or 15 years ago when I first found out about Zillow's, I was a first time, it was my first time owning a home. One of my friends was like, oh, you gotta check out this page, Zillow and you can, you can check out, um, how much your house is worth. You can keep track of your property value, how much is going up, how much it's going down. Unfortunately, that's when everything was going down at that time. That he showed me about that. So you're pretty much watching, uh, a train crash. Um, but I remember and out to Solomon because he's the one who showed it to me. And I remember looking at it, you know, I'm like 23 years old maybe, and I'm just trying to get an idea. I didn't realize that that wasn't the actual home value. However, it gives you a good baseline. Fast forward to now in 2019 and Zillow, you know, while it was a newer website, not that many people knew about it. And now it's the top real estate search website, pretty much in the country. So a lot of people when they're starting to do their home search, they're probably going to go and get a start at Zillow. So, I equate what's happening right now into our market and I can even pinpoint, and it's that, that's part of it. And then, um, but we're looking at some of the other things that are happening in our market and we're seeing a different shift and it's going in a different direction. So a lot of you and a lot of my clients have been seeing there say, well what is it with these blue signs in our neighborhoods? And it says 24 hour open houses. Um, you can access the house without an agent. We can sell our house to them. Explain that to me and explain what the benefits are to me. And what I like to explain to people is that you have options and you, whether you want to sell your home traditionally or you want to look at Open door or Offer pad, Zillow or one of the other companies, there's a lot of them. If you want to look at those options, you can and you should because as, as, as at least I would advise you as a professional, I want you to know what all of your options are. And so you should know exactly what's happening. So for, I'll give an example in regards to open door, um, you know, they make it enticing. They make it easy. You go onto website, you enter the information, you'll get an idea of what they would offer you for your house. Again, it's an idea. Um, and you may think, okay, what I want to sell my house for this price. Is this the, is am I selling my house? Am I leaving any money on the table? The truth is you could be. And what we do, we tell our clients before you, even if you're thinking about going that route, well we recommend you do is contact us first because we can present both options to you. We could say, okay friend, we're going to present, this is what will happen if you go on the market and use a traditional cell. And if you sell your home in a traditional market, this is how much you can anticipate by paying. This was how much you can anticipate you'll get for your home. This is how much you can expect that you won't get. You're going to have to pay for your home as far as repair costs or any upgrade costs, and possibly any closing costs and give you that baseline. Is it always a hundred percent accurate? Absolutely not. But majority of the time it's pretty darn close. Then we can also go through with you the like an open door option. If you decided to take an offer for one of these cash investors. And you said, you know what, what does that look like? Their fees can range between six and a half percent to 10 to 15%. I think the highest I've seen for them, that particular company has 10. Some other companies I've seen a lot higher. Um, so they're going to give you that. And then what they'll do also is if you were to accept their offer, they'll go through an inspection process and they may ask you for additional credits. Um, should you choose to accept their offer if they find things that need repaired or if they find anything that, that they weren't aware of prior to them inspecting the property. So all of those things are unknown costs. So you don't, you're not 100% where your bottom line will be, but you'll get an idea based on their initial offer. Um, but what we always tell, like I said before, we always tell our clients to call us first so that we can show you every single option. Um, our team, the next few home professionals. We are an open door partner, which means we have access to be able to see what they would offer you for your home and be able to, we also have an opportunity to send it to our other investors that we work with locally, um, that are, they may be looking to hold onto the property. So you may do a little bit better. You never know, but we'd like to be able to all those options to you so that you can see what is the best decision for me. Um, am I making the right choice? How much money am I leaving on the table? So for example, um, we had one client, they were offered, they were made an offer from one of these, actually multiple of these companies. And the offers range from about 400,000. Um, and we ended up selling their house for 480,000. So that's a completely big difference. So ultimately for that particular client, you know, leaving$79,000 or$80,000 on the table, that was not an option. And could it be an option for you? Possibly, but not many people that I know want to just leave$80,000 and give it away. That's a completely big difference. So I think just with that example in particular, you can see the benefits of saying, let me sit down with a professional, somebody that who knows what's happening in the market from every single angle to see if, if, if this is the best option for me. So for that example that I gave you that, that it didn't work for that particular client. Now we do have a client that we worked with where that was the best option for her. You know, she was given an offer. Um, I believe they were charging her about 8%. Um, after all the fees and things like that, she knew that there needed some, there were some repair costs that we're going to be involved with the house. She was okay with that because when we looked at what she would do with a traditional sale based on her price point, average homes in the market, we're selling for about two 30 in her neighborhood. And I believe the offer from open door was about to 20. Um, and out of all of the investors that once, that was the one that came in the highest. And for her when she looked at what they were charging against what she would get in the open market, which she would've got her offer. But um, but the other thing that would have came into account because of the price point, because of the area that she lived in, she was likely going to have to pay close help a buyer pay closing costs just because based on sales trends for that area, there was a really high probability that she may have to pay closing costs. So when we looked at all the numbers, that was the best possible option with her. In addition to that, there were some other familial items that were of importance in it. We made it really difficult for her to show the house. So in that particular case, it was the best possible option for her to go ahead and accept their offer and move forward and sell her home that way. So I say all, I give you those two examples and I say all that to say it's not all traditional home sales is not going to be for everybody and selling your home to an investor or to what we call an I buyer is not always going to be your best option. But what you want to do is make sure that you have a trusted real estate professional in your corner that can help you make the best decision that's going to be right for you. Again, if you don't explore all those options, you don't know if you're making a good decision or a bad decision. Um, I also say what you should take into account is the market because maybe you're saying, well, I can be a little bit uncomfortable. I just want the convenience factor. And so I'm going to go ahead and take this offer. But you know, depending on where your house is located, where the market is, how long your house may be on the market, you could, you could still do really well without having to take that option. For example, if I said, okay, if we do these things, you leave your house for one day or three hours or four hours and we can get you this amount on the, we can get you this dollar amount in your home sale based on where the market is today and it will help you make an additional 15, 20,$30,000. What would that do for your family? What would that do for your vacations? What would that do for your savings? How, you know, would you rather be not convenient at all or take three or four hours to be out of your house so that you can possibly secure the best possible offer, etc. Your family up for future success. So again, you know, the open doors offer pads, um, you know, even Zillow is making offers. They're going to make you those different offers and you're gonna be enticed by them and you again, you should consider them, but you also want to know what is on the other side of that. Um, and again, like I said, those, those I buy or type situations, that's what we would call a non traditional home sale because in the past it was okay, you hire an agent, you do, you know, the agent would do their marketing, they would bring people into your house, show the property, get you an offer, get the property sold, move forward. Um, some of these other convenience factors with these I buyers can be a matter of you choosing your closing date. You're not having to worry about leaving Your House for showings. Um, there, there could be a number of convenience factors that go along with that. And so when you're, when you're looking at all your options, if you don't know what's on the other side of it, you could possibly make about decision. But like I said, if you have a trusted real estate professional in your corner, you can make a good decision. I'm, I mentioned before that my team is an open door partner and in addition to being able to get you offers from that company, it, those offers typically come in at a higher amount. If you go through the next few home professionals because they're going to give you an additional credit just because you work with us. So again, there are, you do still have the ability to work with professionals even if you choose these other routes. So it may get you to your destination a lot faster to where you're going, but you also want to make sure you have representation from somebody that you trust because at the end of the day, these other entities, they're representing themselves. They do not represent you. Okay. And if you guys have any other questions about that, feel free to leave your questions in the comments. Send me a text, send my team attacks.(480) 281-3078 or send us an email and we can answer those questions for you. Um, the other thing we have, we work with other investors as well that are there. They're more similar to a traditional home sale. Um, I can tell you right now, I've done a couple with, um, guys recently where, you know, they were looking for something very specific. Maybe they want to rehab the property, maybe they're looking in a specific area and somebody needs a quick sale, a fast sale. We have investors that can close in as early as three days for you guys, um, or it can close as late as 30 to 60 days. Um, one example I can give you, as we recently had a couple of contact us that was in foreclosure and the foreclosure was happening in less than one week and we were able to secure an offer for them that will satisfy one, prevent them from going into foreclosure and to also still put money in their pocket so that they were able to, to move out. And we added another gentleman that was in a similar situation, his foreclosure, he was in foreclosure, but I think it was 60 days out. And, um, what he needed to do is be able to sell his house, get a good price for it, and to be able to have money to move into his new place. So we were able to get really creative with that investor. Um, they even gave him money up front so that he could put down on an apartment where he moved to and then we later on close on that property. Um, so, so again, we can get really creative depending on your situation. It's just a matter of are you guys communicating with us? Are you, are you calling on the services of a professional that can help guide you through these, through these steps? Um, because sometimes the information you see on Google can really lead you down the wrong way. So even if it's just a simple question, just know that my team is here to answer any questions you have. We want to make sure that you at least get and get the right information specific to here in Arizona specific to your situation so that you can make the best possible decision. Um, anyway, so that, that's pretty much it. You guys, I mean, like I said, I know you, you, you're, you're looking at it, you're seeing, you're probably getting a lot of phone calls. People are saying, okay, we want to buy your house for cash. Um, you're probably getting off her saying, you know, we can do a trade in program for your house and you're thinking, okay, I can move into a house that doesn't, that's maybe newer and I don't have all this, you know, the maintenance I can avoid doing all the maintenance that I might need to do on my house because it's older. Those are all options that you are more than welcome to consider an you should, I just recommend that you get an additional opinion and get some additional guidance so that you can make the best possible decision and walk away in a much better financial situation than had you not consulted with somebody that happens to know what's happening in the business. Because if you think about it this way, um, you know that on average you may do one real estate transaction in 10 years, whereas this is, this is what we're doing every single day. So we're closing multiple transactions per month and we're able to see so many different situations. So with that, we're going to be able to be a great resource for you guys and that's at the end of the day, that's what we want to do. So hopefully that was good information for you. If you have any questions about what I said today, um, feel free to give our team a phone call at(480) 281-3078 or drop us a line in the comment section or send us a message or email, however you guys would, however you prefer to communicate is the way that will respond to you. Um, as I said before, we're dedicating this month to nontraditional ways to buy and sell a home. Next week we're going to be talking about, um, an option for those individuals that may not be in a position to purchase a home, but you want to secure a price right now and then maybe be able to assume and maybe be able to buy the home two to three years from now at that same price. So some good options for people that might be self employed, good options for people who most maybe recently you located to the valley and maybe you don't have maybe don't have the job history or the income history. There's there could be a number of options we want to talk. We're going to have some guests on that are going to talk about some other non traditional ways where you could still purchase a home and secure price and interest rates as it is in today's market. So again, I trust that this information is valuable to you. If if you find that it was, do me a favor and spread the love show, share it with a friend and give me your feedback in the comments. And if for some reason you cannot watch our videos, be sure to subscribe to us on Itunes, on Stitcher, on soundcloud or pretty much anywhere where you listened to podcasts. So as I wrap up, I just want to say a special thanks to all of our sponsors, the next few home professionals team. We are a full service real estate team that can assist you with buying, selling, investing. And navigating your eye buyer, um, offers, just reach out to our team at the number that's on the screen, the(480) 281-3078. If you are not currently in the market to purchase a home, we can also be additional resources for you. I know one of our past clients recently reached out and asked us about um, timeshare, how she can get rid of a timeshare. So was happy to be able to help her with that. And um, also we also did a blog recently, 100 things to do during the summer and one of our clients actually has some people in and coming into town and she's like, I don't know what to do for them. And I was happy to be able to share that blog for us. So just know that even if you're not buying or selling real estate, we are going to be a, an ongoing, an ongoing resource for you. So be sure to reach out. Um, special thanks to Justin and Ryan of the Oliver Wayland team at Nova home loans. Justin Ryan are available for all of your home mortgage needs. Whether you're looking to do a new home purchase, whether you're looking to refinance or you just have some questions because you're preparing for a future transaction, be sure to give them a phone call. They're always willing to answer any questions that you might have. And like I said, they're just an amazing resource. Um, as you are looking at maintenance for your house, you probably are doing some air conditioning servicing this summer. Um, because all of a sudden hot, be sure to, if you're looking for ways to offset some of the costs of home ownership, consider a home warranty. Reach out to Yvonne Hunter with platinum home warranty. We do recommend, um, platinum home warranty for our clients when they're purchasing a home and if they're looking to renew any home warranties that they may have had in years prior. And as always, Jeremy Eaten at security title. We appreciate the services that they offer. Um, we're closing a couple of this week with um, Elba Palmer over in the Gilbert office. They are always amazing and they're always a great support for our clients. So thank you again to all of our business partners that help us and our clients and have the best and most successful real estate transactions possible. Again, tune in next week where we're going to be talking about different alternative options to be able to purchase homes, even if you can't pre purchase traditionally today. See you next week guys.