iBuying is all the rage! This American concept, also known as instant property purchase offers to simplify and speed up property transactions by using an intermediary platform. Fast and efficient, this model has made a name for itself in the United States and is now being exported to Europe.
Discover the Wesold campaign, leader in iBuying in Belgium.
After its meteoric rise on the American market, the concept is now tackling the European market. But how can we explain the success ofiBuying ? Over and above technological advances, the emergence of this concept in Europe and around the world is due to a series of unpredictable and unprecedented phenomena. Remember during the Covid crisis and the health measures in Belgium, we saw a huge increase in demand, even though it had become very difficult to organise viewings and therefore to sell your property. How do you sell when it's virtually impossible to get in touch with potential buyers? The alternative solution was obvious: theiBuying
What is iBuying?
iBuying, or instant property purchase, refers to the service provided by platforms - iBuyers - which use high-performance IT tools to buy and sell properties in record time. The aim of the platform is to simplify the selling process for the owner by acquiring the property and then selling it on.
The sales process on an iBuying platform
In practical terms, this is howiBuying :
- The owner defines the terms of sale and offers the property for sale.iBuyer ;
- It studies the demand, analyses and estimates the value of the property using sophisticated algorithms and a single visit (which may be virtual);
- It's true that the platform submits an offer slightly below the market price, but it does so in just a few days! Most platforms guarantee that an offer will be sent within 48 hours! This is where the great advantage of this technology lies, as "traditional" sales usually take several months. The offer is simple, clear and precise, and includes no additional conditions. Once the offer has been made, the iBuyer will not go back on it;
- Once the contract has been signed, the transaction is quickly completed and the documents sent to the notary;
- Next, theiBuyer resells the property via its platform.
The advantages of iBuying
A simple and easy sales process
The most obvious advantage ofiBuying for the owner of a property is the disconcerting ease with which it can be sold. For owners wishing to sell a property, using theiBuying takes the stress out of selling and avoids the potentially long and tedious process of finding a reliable and solvent buyer. L'iBuyer simplifies your life by making you an offer that matches your requirements as closely as possible. Although the offer may be slightly lower than the market price, the speed and simplicity of the operation undoubtedly outweigh the loss of earnings.
At administrative level, the iBuyers are also professionals who know their trade inside out. They guarantee a fast transaction by ensuring that no errors slow down the operation. Documents are generated quickly and checked at every stage.
Time is money
Time is a precious commodity, and the iBuyers have understood this. This is especially true when the circumstances leading to the sale of a property are difficult. Many owners are forced to sell their property as quickly as possible for personal (divorce, death, transfer abroad, etc.) or economic reasons.
Pressed for time, they are often forced to take out a loan, known as a bridge loan, while waiting to receive the proceeds of the sale. The first thing they have to do then is repay the loan and the interest, which adds up day by day. All the more reason, once again, to sell as quickly as possible. Not to mention the fact that bridging loans are far from accessible to everyone, and exclude people who are already in receipt of a pension.
Compliance and maintenance included
It's the little extras that add up. To put your property up for sale, it is sometimes, if not often, necessary to carry out a series of works and repairs. Once again, this represents an expense in terms of time and money that the owner would be happy to do without, when his objective is not to refurbish a building in order to resell it later.
This problem is solved with theiBuying since most iBuyers will take care of maintaining and bringing the property up to standard at no extra charge. The reason is quite simple: they have already taken the condition of the property into account when calculating its value and formulating their offer.
Security for buyers
What is the point ofiBuying for buyers? The process is extremely fast and efficient. The platform guarantees the quality of the property, which is reassuring for those who are wary of new technologies. In fact, these platforms generate a large volume of transactions, enabling them to achieve economies of scale. It is therefore vital for them to maintain an impeccable brand image, as their credibility depends on it. Very often theiBuyer works with local estate agents and experts to refine their analyses and estimates.
The limits of iBuying
So what are the drawbacks of this innovative concept? Well, where there's technology, there's a technical limit. L'iBuying is generally based on algorithms and virtual visits. In practice, however, it is not always possible to use this system outside major cities. For example, the prices obtained using algorithms may not correspond to local market prices when the market is very specific, and virtual visits require a high quality internet connection.
Who are iBuyers?
The concept of iBuying emerged in the United States in 2014 with Opendoor. This start-up (now listed on the stock exchange) has enjoyed dazzling success. It now has a significant share of the American property market and competes with the biggest players, including the gigantic Zillow. The famous property listing site was quick to recognise the strength of iBuying's concept, and it itself entered the fray in 2018. It's a real revolution on the American market. In fact, experts estimate that in the United States, 60% of property sales will take place on iBuying platforms in 2025. Other iBuyers have emerged since then, including Knock and Offerpad..)
As for Belgium, an iBuyer by the name of Wesold was launched in 2020 and is expanding in what is still a very conservative market. Its beginnings are impressive. With its long experience in the property sector, the team behind the development has launched a crowdlending campaign on BeeBonds with the aim of raising up to €1 million by the end of the fundraising campaign.
Conclusion: iBuying is a revolution in the property world
The concept of instant property buying is developing without competing directly with estate agents, but by adding a missing piece to the complex jigsaw of the property sales process. After proving its worth and conquering the United States, theiBuying is entering the European market with a vengeance. Shaking up an old model, this concept is spreading rapidly and establishing itself on a long-term basis.
In a world that is becoming increasingly digitised and faster than ever, theiBuying brings simplicity and security. This concept may come as a surprise to the more conservative players in the property sector. However, theiBuying is an attractive solution for many many owners who want to sell their property as quickly as possible without taking any risks.
In a nutshell
Advantages and disadvantages ofiBuying :
+ Guarantee of the buyer's solvency and reliability
+ A single visit (virtual if necessary)
+ Avoids the need for a bridging loan
+ A clear offer within 48 hours and a guarantee that the platform will not withdraw
+ Sale finalised quickly
- An offer slightly below the market price
- Does not always work outside major cities