If you are considering selling your house in San Diego, you need to know about your options. The most common ways to do so are with in a traditional sale or maybe even with an iBuyer. There is also a third option that is provides a solution that is the best of both worlds. Listen below to explore what is best for you.
(click video below)
Hi Everyone! Today’s topic is How an iBuyer Compares To A Local, Retail Home Buyer in San Diego. My name is Brian of Trusted House Buyers and today we explore the new buzzword in San Diego real estate, iBuyer. Thanks for tuning in.
iBuyers are a relatively new option when it comes to selling your home. They provide a quick option if you need to sell as soon as possible, but obviously, they are not the only option available to property owners in San Diego. Of course, there are still traditional local home buyers in San Diego County that are financed and able to purchase your home using traditional methods. So how does the iBuyer compare to a local Home Buyer here in San Diego, California?
Well, iBuyers are companies that buy and sell real estate through technology. They felt there was a need to simplify and streamline the real estate transaction process, basically eliminating the real estate licensee. The iBuyers provide a platform to buy directly from homeowners and sell to other buyers directly. These big, national companies are looking for properties in very good condition with very minimal or no repairs to make. If the property does need repair, they will often offer much less for the house then it could get otherwise, or require the seller to make the repairs themselves before closing. iBuyers are focused on a volume play, but are really looking solely at the data in an attempt to derive at a number that fits there profit model. As of right now, iBuyers are not active in all areas. There are iBuyers in San Diego currently, and their presence will likely to grow over time.
So let’s further examine those two options mentioned: iBuyer vs. regular retail, homebuyer.
1st: Selling Your Property to An iBuyer
As a property owner, you need to know how an iBuyer compares to a local home buyer in Sa Diego, when you decide it’s time to sell your property.
Through an iBuyers platform found online, property owners can request an offer from the company. The owner fills out information about the property and will disclose any known issues or recent upgrades. Usually you will answer a series of questions and upload photos, if possible. Most homeowners in this scenario have been found to only highlight the good aspects of a property, right If the property meets the company’s initial criteria, the platform then runs an evaluation on the subject property. The iBuyer will typically provide a cash offer within 24 – 48 hours of the request. I’ve seen them drop the ball here, but that’s at least what their marketing collateral says. If the owner accepts the offer, the iBuyer will usually send out an inspector to verify the status of the property. If any repairs need to be made, they will either request the seller to fix them or deduct the repair cost from the offer at market rate. They are not, however, in the business of buying properties that are distressed or require a fair amount of work. They trying to do things like paint, carpet, and replace some fixtures, door handles, etc. and get that asset back on the market as soon as possible. Now, if and when the repairs are settled, the owner then picks the close date. Keep in mind that these iBuyers charge fairly large fees for the transaction, so while you might thing you’re saving the cost of commissions, make sure you understand all the fees that are involved, since they are just being ‘relabeled’ as costs, instead of agent commissions. How much are you going to net on the deal. And do your own due diligence so you can confirm any figures that are provided to you.
The 2nd option is Selling Your Property To A Local Home Buyer
A local home buyer in San Diego will generally be using a real estate agent. This means the local home buyer will be most likely finding your property through the multiple listing service, or MLS of the area. Maybe even a FOR SALE BY OWNER site. The buyer’s agent would then present the offer contract to the seller’s agent, or seller directly if they are not using an agent. If the seller accepts the offer, the buyer will hire an inspector to make sure there are not any hidden surprises. Occasionally, the buyer will even purchase in all-cash; however, the typical home buyer will need financing which can take 30-90 days, depending on the lender. Financing is pretty normal here in San Diego, given the price points of local real estate. Have you ever seen that Georgia plantation home with 5 bedrooms at 10 acres for $125000? Yeah, well that’s not the world we’re operating in. Now in a retail transaction, this is point in the process is where some buyers are forced to withdraw their offer because of financing issues, and they can do so legally if their financing contingency is still in place, usually weeks in to an escrow. They get their Earnest Money Deposit back with no repercussions, and the seller has to star the process all over again, trying to find a will buyer. In all honestly prequalification letters are pretty easy to obtain, but when it really gets sent to a lender’s underwriter, funding might be denied when things are really combed over and income and expenses require more verification. If they make it past this point and the inspection comes back agreeable, then the closing usually occurs according to the contract.
There are also local home buyers that do not use real estate agents, and they are basically local investors. Working with these buyers will have aspects of both iBuyers and regular retail buyers. They tend to make all-cash offers with quick acceptance time frames. Some of the good ones will even been quite flexible with their terms and time frames. The idea is to solve the sellers issue rather then meet the stringent requirements of a traditional buyer, or plug the data into a ‘buy box’, if you will, like an iBuyer. Additionally, a local investor will to be more knowledgeable then a big iBuyer, seeing as they are not using algorithms to solve an issue and are more hands on with local real estate. Just like a local homebuyer with conventional financing, they most often work and live near the property being sold, so can provide more of a local expertise. The cash local home buyers also has the ability to close quickly since they are not waiting for financing, which appeals to folks who need their money in less then a week. There are many scenarios where this hybrid type buyer give the seller the best of both worlds.
But whatever you decide, be informed about each option and find the one that most suits your situation.
For more information on how an iBuyer compares to a local home buyer in San Diego, you can always call us at Trusted House Buyers by dialing 619-786-0973.
We’re always happy to answer any questions or explain our services. Thanks for watching and good luck out there!