Anyone use OfferPad.com to sell their home? (Tampa: for sale, real estate market)

[Tampaite]

Look for feedback from anyone who may have used OfferPad to sell their home?

Received a flyer in the mail but haven't seen any reviews online on OfferPad.

[kmarc]

Originally Posted by Tampaite

Look for feedback from anyone who may have used OfferPad to sell their home?

Received a flyer in the mail but haven't seen any reviews online on OfferPad.

We haven't used them, but we did get curious when we saw a house for sale in the neighborhood with an OfferPad for sale sign on it. In other words, Offerpad bought the house and is now selling it. The property is listed in the MLS as Pending. So I did a little research.

As far as I can tell, they give you an offer that's somewhere between lowball and retail through an agent. It may or may not be worth it depending on what your situation is, because they apparently have the ability to close quickly and offer some extras like moving assistance if that's needed. For people who don't need to hold out for top dollar (which may or may never materialize), it eliminates the work of contracting with an agent and having the house sit on the market waiting for that acceptable offer and then paying the agent's commission and also any other expenses that would accrue while the house is on the market, such as lawn and landscape fees, association fees, stuff that might need to be fixed, etc. It seems to me that the business model is to buy at a better price than your average investor or flipper would offer, but lower than retail. Because it is between the seller and Offerpad, it never hits the MLS until Offerpad turns it around and sells it for themselves. Obviously they look to make a profit on the difference between what they paid for it and what they sell it for.

Whether this works for someone as a seller depends on what their goals are and how much equity they have in the home. If it were me, I'd first get a market analysis from three agents to arrive at a realistic listing price. Then deduct expenses like commissions, repairs, taxes, maintenance fees, HOA fees and any other carrying expenses over a three month period or whatever the average amount of time is that it takes to sell a home in your area. You may also wish to deduct the difference between your intended asking price and what you would accept as an offer from a potential buyer. Then see what Offerpad would give you and compare and see if that works for you.

[MortonR]

I have heard through a realtor in my area that OfferPad and other services like it are somewhat predatory in the sense that they will perform an inspection, give you a price, then list their costs for repairing or reconditioning items on the inspection at greatly inflated prices, thereby reducing the offer price considerably.

I don't know how common this is, but they said they've seen it occur on 2-3 occasions when they've come in after the fact to do a market analysis.

RM

[kmarc]

Originally Posted by MortonR

I have heard through a realtor in my area that OfferPad and other services like it are somewhat predatory in the sense that they will perform an inspection, give you a price, then list their costs for repairing or reconditioning items on the inspection at greatly inflated prices, thereby reducing the offer price considerably.

I don't know how common this is, but they said they've seen it occur on 2-3 occasions when they've come in after the fact to do a market analysis.

RM

Wouldn't surprise me. They are, after all, investors. Seems like the pitch is that they offer more than other investors and close fast, but I have no idea if that's true. Still, it doesn't hurt to see what the offer might be.

[MortonR]

Originally Posted by kmarc

Wouldn't surprise me. They are, after all, investors. Seems like the pitch is that they offer more than other investors and close fast, but I have no idea if that's true. Still, it doesn't hurt to see what the offer might be.

Absolutely. One can always decline.

RM

[Tampaite]

Thanks for the response. I'd think they would be competitive considering you have to pay your realtor or agent 6% to sell the home.

[kmarc]

Originally Posted by Tampaite

Thanks for the response. I'd think they would be competitive considering you have to pay your realtor or agent 6% to sell the home.

It would be interesting to see the actual terms of an Offerpad purchase contract. If it's a straight-ahead deal where the seller gets their cash and gets out from under the home, plus moving assistance and other inducements to sell their home at a discount to Offerpad, then it might work for some sellers.

However, if it is one of those "we partner with you" deals, where the seller has to wait for their cash until Offerpad re-sells, and is still on the hook during that time, you're better off going with a realistic realtor who has a track record of racking up fast sales. Many people, when they go to sell their home, are most likely to list with a realtor who presents the highest listing price, which some will do just to get the listing. And then the seller wonders why it sits, and after time has gone by, ends up having to reduce the price anyway. If it was me and I needed to sell, I'd go with a realtor who is brutally realistic and has a good track record of sales. But that's just me. Most people seem to have an over-inflated idea of what their house is worth. Of course, it also depends on what the real estate market is doing at the time.

I am not a realtor, just someone who has bought and sold some properties over their lifetime, with various combinations of marketing, with and without realtors involved. With the exception of the last bubble, where I posted the house on a niche website tailored to a certain kind of buyer and didn't even have to put a sign out to get a full price offer, I have found that the MLS is key to a fast sale. It's not that people can't do FSBOs successfully by other means, I've done it, but you'd better be prepared for buyers who have no clue how to write up and present an offer that complies with Florida law or what the role of a title company is, etc. The real fun begins when the sincere but clueless buyer is standing there in front of you, making an offer without so much as a sheet of paper in their hands. That's when you start to learn how a good realtor (I stress the word "good") really earns their commission.

I notice that Offerpad uses the MLS when they go to re-sell. Presumably they pay some sort of commission to an agent who brings a buyer.

[bobandsherry]

Found this about OpenDoor, similar service but different geographic location. I would guess OfferPad is structured similarly.

OpenDoor

Also found this: Why a top agent started OfferPad, an Opendoor competitor

Here's from OfferPad's site: See how selling to OfferPad compares to selling traditionally

[OfferPad]

Originally Posted by kmarc

It would be interesting to see the actual terms of an Offerpad purchase contract. If it's a straight-ahead deal where the seller gets their cash and gets out from under the home, plus moving assistance and other inducements to sell their home at a discount to Offerpad, then it might work for some sellers.

It's a straight purchase offer for the home. We're well capitalized and are prepared to close on any home within 5-90 days (FL: 15-90). We have established relationships with licensed/insured moving companies in every market to provide free local moving services within the terms of the Free Local Move. Additional fees beyond that are the responsibility of the seller.

With OfferPad, sellers enjoy the convenience of not having visitors show up unannounced or scheduling showings/open houses. Besides one third-party inspector (if they accept our offer) and a member of our team, that's all the people they deal with.

Originally Posted by kmarc

I notice that Offerpad uses the MLS when they go to re-sell. Presumably they pay some sort of commission to an agent who brings a buyer.

We do, but we're also a brokerage and can work directly with prospective homeowners as well. We have our homes available for sale on our website with more markets being added soon.

[MortonR]

Originally Posted by OfferPad

It's a straight purchase offer for the home. We're well capitalized and are prepared to close on any home within 5-90 days (FL: 15-90). We have established relationships with licensed/insured moving companies in every market to provide free local moving services within the terms of the Free Local Move. Additional fees beyond that are the responsibility of the seller.

With OfferPad, sellers enjoy the convenience of not having visitors show up unannounced or scheduling showings/open houses. Besides one third-party inspector (if they accept our offer) and a member of our team, that's all the people they deal with.

We do, but we're also a brokerage and can work directly with prospective homeowners as well. We have our homes available for sale on our website with more markets being added soon.

The 800 pound gorilla in this room and what people are probably most interested in is whether or not you're making offers at or near market prices. If not, you're no different than the other somewhat predatory cash buyers who advertise throughout the area, other than offering additional services with the purchase/sale.

RM