In an effort to remain competitive in a world of automated offers and “no-hassle” home-selling, Keller Williams has launched its own i-buying program, Keller Offers, to compete with Opendoor, Offerpad, and even Zillow Offers. Keller Williams will offer all the attractions of any other i-buying program (mainly instant, online offers on your home) along with assistance from a Keller Williams agent without the hassle of – you guessed it – paying a commission.
“Currently, with many instant-offers programs, consumers don’t have the assurance that someone is looking out for their best interests,” Gaylyn Ziegler, director of operations for Keller Offers, explained. “We believe the consumer deserves the experience that only an agent can provide.” Ziegler noted the home seller will not pay commission for this service, but instead, “Our offer will include payment to the seller’s agent to completely remove or offset an added cost of having an agent involved in the transaction.”
Initial Launch in Texas
The program will launch in Dallas-Fort Worth, Texas and expand to six or either other markets in the coming months. Other than DFW, Keller Offers has not announced which other markets will be part of the early roll-out. Ziegler explained, “The microeconomics of an area will continue to factor into our roll-out decisions.”
How I-Buyers Operate
Since the advent of the concept of i-buying, these automated offer systems have generally entered large, competitive markets in their initial launch phases. While most i-buyers resist being dubbed “flippers” or flipping companies, they operate on a model that essentially involves making a purchase at a discount – the price you pay for the extremely easy process of selling in the system – then make the repairs that a traditional agent would recommend you make on your own before a traditional sale. Once cosmetic updates have been made, the i-buyer puts the home back on the market. Other models include “trade-in” sales, such as are offered by the Atlanta-based Knock, which allows you to purchase a new house while they sell your old one, and Charlotte-based Ribbon, which permits sellers to pay rent in a new house until the old one sells.
Keller Williams’ decision to enter the i-buying arena is indicative of the serious and substantial effects this type of algorithmic home-selling and -buying is having on the residential real estate industry. While Ziegler predicted that Keller Offers will likely account for only about 10 percent of the total business the company does, she also predicted the branch would make “$100 million in offers by the end of the year.” Gary Keller, CEO of Keller Williams, described the decision to debut Keller Offers as something about which “I have no choice” in an interview with Inman in January 2019.
Tell us what you think:
- Are i-buyers here to stay?
- Is this new model good for real estate? How about real estate investors?
- Have you used an i-buyer?
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