Some iBuyers Temporarily Halt Instant Offers
NEW YORK – Several iBuyers – online companies that make instant cash offers to home sellers – have suspended their services in light of the coronavirus outbreak.
Opendoor, the largest iBuyer in the U.S., as well as brokerages with iBuying arms, such as Realogy and Redfin, announced they were holding off any new instant offers while the nation responds to the pandemic.
Realogy said in a statement that it would suspend its RealSure program for the foreseeable future. “To maintain the integrity and future of RealSure, we made the difficult decision to suspend all cash offers at this time,” Realogy said. The company added that it would monitor the market in hopes of restarting the program as soon as possible.
Redfin has put a pause on RedfinNow, an iBuying platform that enables the firm to purchase homes directly from sellers and resell them.
“We remain as committed as ever to giving homeowners the option of an instant offer – but only when we can know what a fair price for an offer would be [in this market],” Redfin CEO Glenn Kelman wrote in a blog post this week.
But it’s not all doom and gloom. Kelman notes that in some areas of the country experiencing a minimal impact from COVID-19, it’s still business as usual. The disruption to the market from the coronavirus likely will be short-term, he added.
“Even where buying demand is falling, we believe that low inventory has limited some of the impact,” Kelman wrote on Redfin’s blog. “Many agents we spoke to Tuesday morning still report bidding wars on listings.”
As of now, Keller Williams and a few other iBuyers are keeping their iBuying programs in place.
This marks the first slowdown in the economy that the relatively new iBuying model is facing. Meanwhile, traditional real estate brokerages are continuing to shift their work toward remote and automated solutions to keep transactions on track.
Source: “The Halt of Billion-Dollar Real Estate Businesses; iBuyers Suspended,” Forbes.com (March 19, 2020) and “Realogy Is the Latest iBuyer to Suspend Cash Offers,” The Real Deal (March 19, 2020)
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