Are iBuyers Changing The Way People Sell Their Homes?

One of the “buzz words” you hear often in the real estate industry today is “disrupter“.  To disrupt, by definition, is to “throw into turmoil or disorder, interrupt the progress of (a movement, meeting, etc) or break or split (something) apart.”  With dozens and dozens of new startups, new business models and new practices coming upon the real estate scene over the last handful of years, it seems practically everyone wants to disrupt the real estate industry.  Why not?  Afterall, there was some $70 Billion (yes, Billion with a “B”) in commissions made by residential real estate agents last year on the 5.5 million home sales that took place in 2017, so who wouldn’t want a piece of that pie?

One of the disrupters that have come along is the “iBuyer”, which refers to one of the Internet-based company’s that buys homes directly from sellers offering them an alternative to the more traditional method of listing their home, waiting for the buyer to surface and then waiting for the closing.  Some, or perhaps many, real estate agents are concerned that iBuyers may negatively impact their profession if in no other way by putting a dent in their commissions by offering sellers a way to sell their homes without an agent.  However, before agents get too worried about it and before sellers get too excited about the idea, especially in St Louis, we need to recognize a few things: According to ATTOM Data, the two biggest iBuyers, Offerpad and Opendoor combined only purchased a total of 3,992 homes in 2017 so less than 1/10 of 1% of the 5,510,000 homes sold that year, this is nothing new, and, there is a price to pay for the convenience.

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