Remember this when...
It’s Thursday, April 2… but only because I looked did I know! Here in Las Vegas, it’s Day 16 or so of the Stay at Home initiative, and we’ve been doing what we can to help. The office is closed, and I’m sitting in the guest room, as many of you have seen when I have done some live video.
Today, I wanted to cover something that I’ve spoken about on Video, but wanted to capture it in my Blog as well. We know we are going through uncertain times right now, and many of us, the positive folks, realize that our down turn will once again turn positive. We are going through unprecedented times, yes, but we will get through this. And when we do, we’ll hopefully remember who helped us along the way; and to the contrary, remember who hit the sidelines when things went bad.
In the last week, almost every iBuyer, those tech and Real Estate related companies that will Buy Your Home for Cash, who give you the freedom to close when you want, and not make any repairs, nor have to do any showings, have all pulled out of the buying business. Literally stopped buying. Not only did the stop buying homes on a go forward basis, they CANCELLED contracts for people that hadn’t closed yet. I am not going to name any names; some of the companies are a local member of our Association of Realtors, and others are large, publicly traded companies. But if you pay any attention to news, or commercials, or Facebook ads, you’ve seen the companies.
When the going got tough for them, they didn’t roll up their sleeves and continue to deliver a service for those that TRULY needed it; they simply packed up their bags and said “we’ll see you when the market gets better.” It’s one thing to stop making future buys, it was an entirely different thing when they literally cancelled people’s contracts. Some of these people who were selling to an iBuyer, did so because they needed the convenience of a quick sale. Maybe they were in contract to buy another home, either a resale or new build. What about those contracts? Those are most likely cancelled now too. Earnest Money Deposits forfeited. Funds lost. Opportunity Squandered.
In Las Vegas alone, the largest of the iBuyers sold over 500 homes, just in the first 3 months. That was close to $150,000,000 in volume! So to say them going away is not consequential is a bit of an overstatement.
Look, I believe their business model really attacks a would-be home seller. They are playing the ‘convenience’ factor, but they are definitely charging a premium for it; most of the time their fees are HIGHER than what a normal transaction would be. Additionally, the agreed upon sales price is often less than what a seller can get on the open market, further hurting a Seller’s bottom line. In my heart, I always know an ‘open market’ will yield a higher price for a seller in Real Estate, but understand there are some sellers that need the convenience.
I further believe that these Business Models should THRIVE when markets are unstable. If a seller is concerned about the future, and/or needs access to a quick sale, this is when I fully believed these companies would shine. If they bought right, they could afford to ride out the storm and profit on the back end. But instead, I was shocked when I found out they just packed up and stopped doing business. Revenue and profits above all else is clearly their intention.
I understand. My business is not a NON-PROFIT, although, sometimes I feel it is. We are paid well for performing tasks we handle, and for that, I can point to my education and experience level to justify what we do. I also know that I took and oath when being sworn in as a Realtor. Fiduciary Responsibility means something to me. I will always do my part to put my CLIENTS interest above mine. When the going gets tough, WE ARE STILL HERE. We understand that sometimes, you NEED to sell. Because maybe, just maybe, there is someone out there that just lost a family member, and there was no life insurance, and the mortgage is too much to pay. We are here for those people to help survive. Maybe there is a couple that is downsizing because they just lost 60% of their savings in the Stock Market Panic, and need to find a smaller home, selling the larger family home that delivered so many amazing memories, but is now simply too expensive, and has too much equity that they need to use to live.
This is why we do what we do. For the Relationships. For the people. For helping change lives. So, when this is all over, Remember those that stood by you, helping you through life’s most amazing, and sometimes, most difficult, decisions. We’re here for you. That’s who we are!
-GZ