There is a trend in the Phoenix market, with investor companies like Offer Pad and Open Door. I’m often asked about these companies, so I thought I would talk about them a bit.
They are investors, but as the short sale and foreclosure market has dried up significantly, the traditional “auction” investor has less opportunity, so with more homeowner’s having equity in their homes, the investors have opportunity to change things up. Their business model is to purchase a property below market value, then turn around and sell the property to another buyer. They advertise Hassle Free listing… sell your home to them so you can skip the hassle of listing, showings, and months of uncertainty. Move when you are ready and close with certainty.
My opinion is that if you have more money than time, it could be an option. They typically offer you slightly below fair market value for your property, but then they charge a “deduction” to cover their operating costs. That “deduction” could be right around 8-10%. Then they often ask for additional concessions after they do an inspection on the property.
There is certainly a convenience factor to selling to one of these companies. It’s a cash offer so once the inspection is completed, the sale should go through with no problems. You can pack up and move at a time that works best for you.
Selling to a cash home buying company is no different than selling to any investor. It’s a business transaction. It’s not good, bad or indifferent. It’s simply another tool that you can use to sell your home… however most sellers will net a higher proceeds by using a more traditional sales approach.