The real estate market’s seismic shift is dramatically impacting every facet of the business. Just like brokerages and their agents, iBuyers, Power Buyers, concierge and homeowner-accelerator solutions are rapidly adapting to the overall decline in market activity.
The most recent data in the zavvie Modern Marketplace Report gives unparalleled insight into how these modern buyer and seller solutions are approaching the shift.
The good news is that consumers have more fast and easy options available to help them buy and sell a home, often at either the lowest cost (for buyers) or the highest profit (for sellers). And customer satisfaction scores for all these solutions continue to hit 90% or higher.
Here are some of the highlights from the most recent zavvie report:
Cash offers and Power Buyers. Surprisingly, we’ve seen a drop-off in demand for one of the most popular buyer’s solutions: the cash offer product. There’s a misperception in the marketplace that cash offers are less relevant as the market shifts toward buyers. But cash is still king, and it saves consumers money. As a result, cash-offer products should regain ground in 2023.
Also, the buy-before-you-sell (modern bridge or Power Buyer) solutions are more common, remaining strong throughout Q2. They began to slow after July, but this solution seems well-matched for today’s market, especially if inventory rebounds.
iBuyers. 2021 was a breakout year for iBuyers. They achieved a 1% market share nationwide. The two category leaders—OfferPad and Opendoor—bought more homes in the first half of this year compared to the first half of last year. In Q2 of this year, iBuyer purchases surged 65% compared to the second quarter of 2021.
But as the market shifts and softens, iBuyer activity should drop by about 70% in Q3 of this year compared to Q3 last year. Expect iBuyer activity to be down about 49% compared to Q2 of this year. However, iBuying is not going away; thousands of homeowners still select the iBuyer path to sell. Brokerages need to remain in this space because of the opportunities it continues to provide.
Concierge services. If any seller solution is immune to the current market, it’s the presale renovation folks zavvie works with such as Curbio, Revive, PunchListUSA, Freemodel and others. Because no out-of-pocket cash is needed, sellers will clamor to this category in 2023, as homes need to be move-in ready to sell if sellers want to maximize profits. This is a golden moment for the concierge presale-renovation providers.
Homeowner accelerators. Rent-to-own solution providers like Divvy and Landis are in the spotlight because we need to expand access and increase the number of first-time buyers. A significant shift: they are working with more folks who can qualify for a mortgage now but who want to rent for a while. Expect these solutions to grow and adapt to changing consumer needs.
If you want the next zavvie Modern Marketplace Report, visit www.zavvie.com/modern-marketplace-report. To learn more about how zavvie helps brokerages, visit www.zavvie.com.