While the pandemic may have created a bigger use for iBuying, it was already an option before the pandemic. Instant buying or iBuying, is a do-it-yourself home buying and selling option. It sounds good, but most buyers and sellers end up overwhelmed with information.
iBuying might provide an alternative, but most buyers and sellers still prefer to hire a real estate agent. Trying to go into a real estate transaction without an expert to help can be very stressful. Hiring an agent can help ensure you understand everything throughout the process. It can also save you time and money.
Understanding What iBuying is, Exactly
iBuying is a platform for buying and selling properties. There are several options including Redfin and Opendoor. These platforms became rather popular throughout the pandemic because they eliminate the need for in-person visits.
Instead of taking a tour of a home, you plan to buy, you take a virtual 3D home tour. iBuying platforms also allow for the entire process to be handled online, including the closing paperwork. While this seems rather convenient, most users find the process incredibly overwhelming to navigate on their own.
Why Buyers and Sellers Choose iBuyers
iBuying is known as a bit of a novelty right now. Even in the Dallas/Fort Worth areas, it’s only available in a few cities. Regardless, buyers and sellers do find some advantages through this type of platform including:
- Instant offers with a guarantee
- The purchase timeline is very easy to predict
- Showing and open houses are not necessary
- Transaction fees are lower
The main reason someone might choose an iBuying platform is the lower transaction fee. Saving moving is a benefit many home buyers and sellers want. However, while there might be some benefits to an iBuying platform, there are also disadvantages, such as:
- Incredibly overwhelming for many buyers and sellers when it comes to the amount of information you will have to digest
- Not all homes will qualify
- The transaction process is very impersonal
- Offers are often much lower compared to hiring a real estate agent
- You won’t have any chance of a bidding war
While you might save some money on the transaction fees, you will likely get a lower home offer, too. This can make the net amount you end up with lower, even though the fees are lower.
Where do Real Estate Agents Fit in with iBuying Platforms?
When you plan to purchase a home or sell a home, hiring a real estate agent remains the best option. Using an iBuying platform can work in some situations, but a professional real estate agent can help you sift through the information you need to digest.
When you choose an agent, as a buyer, you will have someone on your site ready to help. They will know the local market and help ensure you get accurate appraisals for properties, along with everything else necessary to buy the right home for you.
An agent can also help sellers. They can help set the right list price and ensure you get the highest possible offer on your property. With an iBuying platform, you will likely end up with a much lower offer. In fact, a study from CA-Research shows that iBuyer platforms end up costing sellers more in fees, while also providing a lower-priced deal. You might lose up to 15% of the home’s price using an iBuying platform instead of a real estate agent.
Agents are More Important Now
Real estate agents don’t need to be worried about iBuying replacing their job. Agents are needed more now than ever before. A 2020 survey shows that 91% of homebuyers said they would refer someone to their agent or use them again. That’s a pretty big deal.
When buyers and sellers take on the biggest financial transaction of their lives, they want the human touch. They don’t want to use an online platform. While iBuying provides a do-it-yourself option, it’s not easy. The average person will find it very difficult to navigate the iBuying process. With an agent, the process becomes much easier.