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Senior Living: Can iBuyers help the real estate market?

With the housing market at a high level, technology could come to the rescue

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The economy is so far from what we were used to before COVID. Today, we are all experiencing a historically high housing market, supply chain issues, increasing immigration, stock market instability, and a new work-from-home culture.

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Strong housing demand combined with low inventory appears to be keeping builders and real estate agents extremely busy across the country. Canada has now increased its immigration target from 10,000 to 411,000 in 2022, which we believe will put further pressure on the expanding housing market.

So if you’re thinking of selling your home this year, could an iBuyer be right for you?

More popular in the United States, an iBuyer (instant buyer) is a real estate company that uses technology to buy and resell your home. When you sell through an iBuyer, you receive a cash offer without the traditional hassle of staging your home and showing it to potential buyers.

This sales solution works because it’s simple and extremely convenient. The iBuyer company purchases your home at market value based on an approved appraisal, then takes care of owning, marketing and reselling your home.

Now, you might think that’s a way for someone to take advantage and “flip” your property – but apparently that’s not the case. The iBuyer’s goal is to find the next buyer, provide the seller with the proceeds of the sale in cash, and then charge a service fee (usually similar to a normal real estate commission).

Sound intriguing?

There is an iBuyer business in Canada located in Edmonton called Sweetly Real Estate (sweetly.ca). This new real estate firm has, like all other iBuyers, its own financing process to introduce the iBuying concept to Canada.

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Sweetly buys homes at market value and simply deducts real estate fees from the price. The service allows owners to sell without any public exposure, gives them control over their closing and moving days, and can eliminate the need to manage two mortgages at the same time or qualify for bridge financing.

Now you might be thinking that buying or selling your home directly with an iBuyer eliminates the need for a real estate agent. According to Sweetly Real Estate, this is not the case.

Sweetly uses licensed real estate agents across the country to facilitate transactions for their clients, by paying them a referral fee or a commission. According to Sweetly Real Estate broker Ed DePrato, the company has seen 400% growth in sales year over year, even during the pandemic.

“Don’t make the mistake of thinking that Sweetly Real Estate is a lowball buyer. Nothing could be further from the truth. If we were a lowball buyer, no one would ever sell their house to us,” says De Prato. market value Customers simply need an up-to-date appraisal, and we will pay for that, less our fees.

Only you will know if an iBuyer is right for you. It seems that many Canadians are considering this process to reduce the stress of buying and selling, even now, in a high real estate market.

We must remember that change is inevitable. It will be interesting to see if this new concept will revolutionize the way we buy and sell real estate in the future, especially with younger generations.

— Christine Ibbotson has written four books on finance, including the best-selling How to Retire Debt Free & Wealthy. [email protected]

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