Buying or selling houses online? Opendoor and Offerpad are the way to go!
One of the safest investments of all time is real estate investment. Last year, when the pandemic hit us globally, we shared the vulnerabilities, pleasures, and sorrows together as one kind. The whole world forgot about every single identity and became one. One country came up with the idea of dealing with the situation smartly, other countries gladly adopted and appreciated it. One of the biggest finds of this pandemic was the ability of companies to execute their routine tasks without the physical attendance of their employees. This not only offered a great solution to the problem at hand but also opened the doors of unlimited possibilities for the future.
The idea of remote working became a savior for unlimited people globally. Saved many lives, continues earnings for families, and much more. One of the biggest surprises pandemic brought was the unexpected steep hike in the housing market. Are we witnessing a clear housing market boom after decades? The continuous increase in residential and commercial properties, minimized selling time, accelerated offers, bidding wars, and decreased mortgage rate are clear indications of the boom in the housing market.
Buying and selling have always involved repairs, inspection clearance, hiring an agent, staging the house, visitations, offers to handle, and final decision making. Not anymore! With the complete paradigm shift of interdependence on virtual networking, we can now conveniently put all these steps to rest and simply do it online with no physical visits involvement. There are multiple platforms like Opendoor, Offerpad, and ibuyer that offer market competitive prices for your house. Every single step of selling a house has now become hassle-free and one click away!
Mortgage Rates at their lowest:
One of the biggest reasons for the housing market boom is decreased mortgage rates due to COVID-19. Nobody speculated that while going through the most unpredictable disaster, people would start thinking about nothing else but buying a property! Most probably people saw the vulnerability of living on rent. Many relief strategies were introduced for people with mortgage liability. However, the inability of paying rent due to job loss pushed people to move in with their families. The saving of rent during this time and many other social factors helped people decide on mortgaging their own property for stability.
The industry is working at about a 2.87% mortgage rate, which is the lowest since the 1970s. At the beginning of March 2020, the 30-year fixed-rate mortgage rate was almost 3.45%. By the end of July 2021, the numbers dropped furthermore. There is an evident drop in mortgage rate since the mid of the pandemic in 2019.
Mortgage Rate since 1970 – 2020 (Source- Freddie Mac)
The recent drop at 2.87% has led to the most unbelievable rise in property demand. It certainly translates into more affordable monthly payments. People are making the most use of rent saved last year by staying with family by now investing in a more stable future by buying a property of their own. The two platforms have been on top among the virtual buying and selling realtors. Opendoor and Offerpad are buying the properties at the most competitive rates, with minimum hassle, and almost everything is done virtually. All you have to do is sign up and negotiate!
Yes, these companies negotiate as well. It’s not like an automated price calculator where you don’t have a chance to bargain. The teams representing these online platforms work alongside you for buying your property at the most profitable rate you can imagine in this booming market.
Median Prices of houses is highest in decades
If you were ever waiting to sell your house at a profit when the time is right, now is the time. Since the start of the pandemic, the average price of properties has increased tremendously compared to the last decade. The data collected by analytics clearly indicate that the median price of a house is now standing at the highest which is $374,900 during the second quarter of 2021. This price was $322,600 last year according to the Federal Reserve Bank of St. Louis (analytics institution). It simply transcends into an astounding 16.2% increase in just one year. It wouldn’t be wrong to say that different regions experience various levels of hikes. However, looking at the stats, it is safe to say one way or the other you are definitely making a profit. The graph shows how much the median price of a house in the USA has increased since the 1980s.
Data source: Federal Reserve Bank of St. Louis (2021).
It is highly recommended to all the clients who were looking to benefit from their investment in real estate to sell the property now and make big bucks. The market has been accelerating since last year and no one knows what 2022 might bring as the banks are looking at increasing the mortgage rates once again. Pandemic is almost over, people are back to their routine, jobs are back, hiring has started, and kids are back to school. There is the complete possibility that the market might not be the same next year.
Who should opt for Offerpad and Opendoor?
Ibuyer companies are offering a service for fees of almost 06-10% in commission. People who inherit the house and are unwilling to spend any time, energy, or effort in selling it can call these ibuyer companies their best friend. All you have to do is log in to their website, enter your house details, get a free quote to accept the offer, and choose a closing date. Once that is done, their inspection team will visit your home and prepare all the necessary documents. Other than that, anyone short on time can also use these service providers as there is a minimum hassle and a small fee for all the services you enjoy. As per the analytics, ibuyer companies offer almost 11% less compared to the market price. This could be a small amount for someone who inherited a house for free and is getting $400,000 without any investment. However, if you can sell your house for $440,000 in an open market but are getting $400,000 through Opendoor/Offerpad, this could be a huge chunk of money you are letting go of.
Similarly, the option of ibuying is also lucrative for people whose property is not located in a hot market. Regions where demand is short and prices are comparatively low can face difficulty in selling a house. However, ibuyer can give you an offer within 24 hours that you can utilize and get yourself out of a hard-to-sell property. When it comes to the rating from Better Business Bureau, both Offerpad and Opendoor have A+ ratings. However, Opendoor has 4/5 star rating and Offerpad has a 3/5 start rating. People who have sold to both platforms have mixed reviews. However, one common finding is that people looking for hassle-free and convenient selling are giving them better reviews and enjoying this service. Sometimes, sellers don’t have enough time to wait for the most lucrative offer for various personal or situational reasons. Ibuyer companies provide a great solution to people with short time, more work required homes, and inheritance properties.
Price appreciation of residential real estate
Since generally there is a price hike in the market after the pandemic; the idea of selling at this point is to cash the maximum amount of money you can on your equity and investment. By using these virtual realtors you let go of the appreciation your house has earned due to this hot market season. On average annual appreciation of residential property has hit 14.1% this year (NAR) which used to be 4.14% since 1995 according to the Black Knight (Housing analytics). This rate is more than any given year since 1995 when the Black Knight started collecting data. Therefore, selling your home at a lesser price than it deserves just to cut down on a few visits and home inspection is probably not a good idea!
The monthly house supply is the lowest low!
As expected of demand-supply rule application, the increase in demand has led to price hikes and shortage of supply. As per the National Association of Realtors, the U.S. was already deficient in its housing needs by at least 5.5 million units for more than 20 years. The housing bubble of 2008 was a major outbreak of overbuilding. Interestingly, this time we are underbuilding. According to the latest statistics issued by NAR, homes supply inventory stands at 2.6 million which is less than half of 5.5 million of what we already were doing before the pandemic.
Decreased selling time and Accelerated offers per listing in decades
The selling time of property has been reduced from 21 days to 17 days in recent times as per the data issued by NAR. Last year we were listing a house on the market and it took at least 21 days to close the deal. Now, in very hot markets, they say that you list the home in the morning and get the offer by evening. After a big blow to the banking sector, last year now is the time for them to reap the fruit of patience. Even the number of offers per listing has gone up to 4.5 offers per listing from 2.2 offers per listing. There is every possibility you will find a buyer who would give you a premium on your investment.
This is the ideal situation and time after ages for people who have been trying to make big bucks on their investment. List your property on the market, sell it, and double your assets by refinancing!