How Can I Get An Instant Offer On My Home?

There have never been as many options to sell a home as there are today. In any major city, advertisements for instant cash offers abound on billboards, on social media, and are even stapled to telephone poles on street corners.

According to the National Association of Realtors, cash sales accounted for 32% of home sales in January 2024, marking the highest rate since 2014.

So who are the buyers offering instant cash offers? Why are more and more sellers considering them over the traditional home sale process? What are the potential drawbacks or pitfalls of selling through an instant offer?

In this guide, we’ve done the research and interviewed experts such as Trevor Heuser, a top-selling real estate agent in Austin with over 800 transactions under his belt, to help you understand your options and make the best decision.

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Who provides instant offers to buy homes?

There are many companies that provide instant offers to buy homes, though it’s important to note that “instant” doesn’t mean seconds or minutes; offers typically arrive within 24 to 48 hours.

iBuyers

Instant buyers or “iBuyers” are technology-driven real estate companies that use algorithms and technology to quickly purchase homes from sellers with cash. The iBuyer model is to invest heavily in sophisticated automated valuation models that are reliable enough to make cash offers quickly that are closer to market value than most other instant offers but still allow enough of a profit margin to make the process sustainable.

The caveat? iBuyers are pickier about the condition of the home and will leave distressed properties for other we buy houses investors.

Two of the most well-known iBuyers are Opendoor and Offerpad. Additionally, HomeLight has a competitive Simple Sale platform that provides cash offers to sellers with the flexibility to close quickly.

Short-term investors/flippers

The easiest way to spot a short-term investor or home flipper is through their common advertising slogan, “We buy houses in any condition.” As opposed to iBuyers, house flippers typically target distressed properties — homes that need significant repairs.

They typically have a streamlined process for purchasing the home and making the necessary renovations to resell it for closer-to-market value as quickly as possible.

Wholesalers

Wholesalers source homes for other investors who don’t want to go through the hassle of finding and making offers on homes. “Some people don’t even realize that wholesalers aren’t even the ones buying their home, because they are allowed to assign the contract to someone else,” Heuser explains.

Their model is to cast a wide net and make a large number of unsolicited offers to find homes that match their investors’ needs. Heuser and others often consider these tactics predatory, especially when they aren’t upfront about intending to assign the contract to others.

Buy-and-hold investors

These investors look for properties they can purchase and turn into rental properties. Sometimes, they also look for distressed properties they can renovate before renting, but for the most part, they are looking to obtain turnkey homes.

Long-term investors aren’t as worried about making quick margins as other investors, but they are very methodical in negotiating a price that provides a target capitalization rate, or “cap rate.”

Trade-in or buy-before-you-sell companies

Trade-in or buy-before-you-sell (BBYS) companies differ from other instant offer companies in that they provide a specific service to help sellers quickly obtain cash to purchase their next home in exchange for a modest fee.

“These companies help sellers buy and move into a new home, and then sell the other home while it’s vacant. When it sells, the sellers typically get another check,” Heuser says. “You’re still getting market value on the home and just paying a small percentage based on how long it takes to sell your home.”

Here’s how HomeLight Buy Before You Sell works:

How much do instant offer companies pay for homes?

How much these companies will offer for your home depends on a number of factors, including which type of company it is, the condition and location of your home, the estimated amount of repairs needed for it to be market-ready, and the extra service fees they charge.

The adage “nothing is free” applies when considering how much instant offer companies will pay for your home. Because these companies typically submit cash offers with short and often flexible closing times, you can usually expect to pay for that convenience in terms of receiving lower net proceeds than a traditional sale with a real estate agent.

Why would I sell my house to an instant offer company?

The main benefits of selling to an instant offer company are speed and convenience.

“Everyone’s convenience has a cost. Selling a home isn’t fun. Showings aren’t fun. It costs money to prepare to list your home, and not everyone is ready to take this on,” Heuser explains. “Sometimes, convenience is worth the cost of using iBuyers and other programs.”

The benefits of convenience come in many forms:

• Cash offers are simpler, with fewer contingencies
• Money is available as quickly as seven to 14 days
• Fewer steps and hassle in the process
• No need to prep the home or perform repairs
• No need to stage the home or schedule showings
• Flexibility for closing and move-out dates
• No “for sale” signs to preserve privacy (such as during divorce)

What are the drawbacks of selling a home through an instant offer?

The main drawback of selling to an instant offer company is that it may sell for less than it would using the traditional process of working with a qualified real estate agent.

The convenience of a shorter, low-hassle process comes with a price tag. “You get what you pay for. When was the last time in life that you paid less and got more?” Heuser says. “You’ve got options, and ultimately you have to make the decision to do what’s best for you.”

In addition to a reduced sales price, there are a few other potential drawbacks:

• Because there aren’t multiple bids, negotiating is a lot more difficult
• Cost structures can be confusing and unclear
• Predatory companies can take advantage of you, such as inflating repair estimates
• There isn’t anyone on your “side” to consult with, such as a real estate agent
• Your home’s condition may disqualify you from working with some companies

To know whether an instant offer is right for you, you’ll want to have a good understanding of how the process works.

How does the instant offer home-buying process work?

The main allure of instant offers is their simplicity and speed. The process is pretty straightforward.

While the exact process may differ from one company to another, these are the steps they have in common:

1. Share your home’s address with the buyer (typically through an online offer website)
2. Answer a few questions about your home (such as its current condition)
3. Receive an initial offer as soon as 24 to 48 hours
4. In some cases, set up an onsite property inspection
5. Accept the offer and close the sale in as few as seven to 14 days

If you are selling a distressed property, the initial offer you receive is subject to specific property condition requirements, and the offer may change after the company determines the repair costs necessary to make the property market-ready.

Finding a reputable company to work with is key. HomeLight has created a convenient all-cash instant offer option through its Simple Sale platform. Start by filling out a brief questionnaire about your home, and HomeLight will provide a no-obligation cash offer in as little as 24 hours. Close in as few as 10 days, with no hidden fees or agent commissions.

Part of the process includes comparing your instant offer to what your home might sell for by listing with a traditional real estate agent. If getting top dollar for your home is more important than the speed and convenience of using the instant offer platform, HomeLight can connect you with top agents in your area.

Connect with a Top Agent

Top-performing agents are experienced experts that sell houses faster and for more money than average agents. HomeLight’s Agent Match platform allows clients to connect with great agents in their area.

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How does the instant offer process compare to using a qualified real estate agent?

There are multiple reasons why hiring a qualified real estate agent may be better for your situation.

The benefits of working with an agent include:

• You’re more likely to get a higher sales price for your home on the open market
• Your agent’s commissions are often comparable to the service fees from iBuyers
• You’ll get personalized service from a professional who has fiduciary duties to represent your best interests
• Your agent will understand the particulars of your local market that an automated valuation process might miss
• An agent can still get you a quick sale or even a cash offer, depending on the market

A great real estate agent will be willing to discuss your options with you. Agents like Heuser actually incorporate instant offers as options in their listing presentations.

“I do what’s best for people, whether it involved me getting a check or not,” Heuser says. “I tell people there are options. They can list on the market with me to get the most amount of money, or if timing or convenience is more important, they can sell to an iBuyer or use a trade-in service.”

Do your research before accepting your instant offer

Whichever route you decide to take, make sure you do your research. Not every promise of an instant cash offer is created equally, and an uninformed seller can end up leaving a lot of money on the table if they aren’t careful.

If you’re planning on moving forward with an instant offer for your home, we recommend you check company reviews and testimonials and then shop around. Request more than one offer and compare them side-by-side. Also, request information about the company’s cost structures with examples of similar sales that show the net proceeds to the seller.

Unless you have substantial experience with these types of transactions, your best bet may be to start by talking to a professional. HomeLight’s Agent Match can connect you with a top-performing agent in your area who can help advise you on your options and what might be the best course of action to help you reach your goals when selling your home.

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