What Is An iBuyer? (And Should You Sell to One?)

iBuyers are tech-driven real estate companies that use algorithms, big data, and AI to make fast offers and streamline home buying and selling. The "i" stands for "instant" — most iBuyers make offers within 24-48 hours and can close in less than two weeks.

Selling to an iBuyer lets you skip the hassle and uncertainty of listing with a real estate agent and negotiating a deal with a private buyer. You can close on your own timeline and let someone else worry about fixing up your house.

The trade-off? iBuyers like Opendoor typically pay less than the open-market value and charge service fees of 5% or more, with additional deductions for repairs and other costs.

However, the tradeoff may be worth it if you have substantial equity and value convenience over maximum profit.

If you're on the fence about which route to take, we recommend starting with Clever Offers, which lets you quickly compare offers from a variety of sources, ranging from local options to nationwide iBuyers. You can also test the waters with a no-obligation 7-day MLS listing — allowing you to see what a wider range of buyers would pay for your house as is, without the commitment of a lengthy listing agreement. Answer five simple questions and start comparing offers.

What's the history behind iBuyers?

The term “iBuyer” was first used in 2017, but Opendoor pioneered the business model in 2014 by creating a new way to sell your home.

iBuyers and cash homebuying companies both pay cash, but target different properties. Cash buyers typically seek distressed properties to renovate and resell for profit or hold long-term. iBuyers have stricter criteria and prefer newer, well-maintained homes in appreciating markets.

To maintain profitability, iBuyers like Offerpad and Opendoor now offer traditional brokerage services and hybrid solutions that combine upfront cash with the potential upsides from an open-market listing.

Companies like Homeward and Orchard have also entered the space with parallel cash-offer solutions that help you buy a new home before selling your current one.

How do iBuyers work?

Selling to an iBuyer

Regardless of which iBuyer you sell to, you'll go through a similar series of steps:

1. Submit your home information through the iBuyer's online form.
2. If eligible, you'll receive a preliminary offer within two days.
3. The iBuyer conducts a virtual or in-person inspection before making a final offer.
4. If you accept, you'll sign a purchase agreement online and schedule a closing. You can usually close within two weeks or choose a later date that works for you.
5. The iBuyer handles all paperwork for closing day.
6. You'll receive your funds within several days of closing, sometimes even the same day.

In addition to direct cash offers, iBuyers may have other options for selling your home, including:

• Traditional brokerage services: Work with a partner agent to list your home traditionally, with the iBuyer's cash offer as backup.
• Hybrid solutions: Get immediate cash from an iBuyer while retaining potential benefits from an open-market sale.

Buying from an iBuyer

Buying a house from an iBuyer follows similar steps to a traditional purchase, with closings typically taking two to three weeks.

Here’s the general process when purchasing from an iBuyer:

1. Search the iBuyer’s app or website for available homes in your area.
2. Tour the home. Many iBuyers offer self-tours; unlock the door with your phone any day of the week and bring your agent if desired. If self-tours aren’t available, book through your agent.
3. Submit your offer through your agent or directly to the iBuyer.
4. Do your due diligence by completing home inspections, appraisals (if financing), and title reviews.
5. Negotiate repairs or credits, secure financing, and schedule closing.
6. Sign closing documents, transfer funds, and receive your keys.  

Traditional home purchases offer significant negotiating room on price, condition, and seller concessions. iBuyers typically have less flexibility in these areas.

“They send offers to their main database, run their numbers, and send back a counteroffer — which is typically not workable,” explains Luke Kochniuk, an experienced Utah Realtor.

Are iBuyers a good idea?

iBuyer pros and cons

Selling to an iBuyer makes sense if you need speed and certainty over maximum profit, such as if you want to offload an inherited property. iBuyers offer quick home sales and nearly unparalleled convenience but typically purchase only owner-occupied homes that don't need significant repairs.

That said, if you have time to spare and want maximum value, working with a realtor is likely the better option.

Likewise, buyers who want full leverage in negotiating price, terms, and repairs are better served by a traditional purchase.

Most iBuyers offer free, no-obligation estimates, so it’s worth requesting one to see how much they're willing to pay for your home.

How much do iBuyers offer?

On average, iBuyers pay 8-14% less than resale value, excluding fees and repair costs. These figures are based on our analysis of 530+ homes bought and sold by Opendoor and Offerpad between 2023 and 2025.

In the early days of iBuying, companies like Opendoor regularly paid more than the market. In 2021, for example, Mike DelPrete, an internationally recognized thought leader in real estate tech, found that Opendoor's median purchase price was around 107.7% of market value.[1]

The model wasn't sustainable as the housing market cooled and appreciation slowed. Today, iBuyers purchase fewer homes and pay less on average.

Florida realtor Christopher Trumbach explains that “Before 2022, they were competitive. Offers were coming in close to market value or what the sellers were looking for. But when the market changed, [iBuyers] started cutting down on the numbers.”

• In recent years, Opendoor paid sellers an average of 9% less than the eventual resale price — $43,950 in lost profit on a $500,000 home.

• Offerpad offered an average of 14% less than the eventual resale price — $69,450 in lost profit on a $500,000 home.

“They're not competitive anymore,” notes Chris. “I haven't had people really interested in looking at them too much recently.”

Complex factors can make iBuyers' offers unpredictable

How much iBuyers offer varies and is based on multiple factors, including:

• Local comparable sales
• Proprietary algorithms and data sets
• Inputs from local pricing experts
• Your input on features, upgrades, and condition

Kochniuk says he's seen offers vary widely, with no clear pattern. “I had a couple of them…that the offer was well above market rent or well above the market rate. I was like just go with it because if they're going to pay you that, it's crazy [not] to go get it. 

And then I've had them like standard cash offers, which are 30% below list price…So they've been all the way across the board.”

Dave Goodman, a realtor with over two decades of experience, says the highest offer he’s seen is 88-90% of market value, while North Carolina realtor Melissa Young told Clever the offers she sees are typically 85-90% of the actual retail value. 

Their fees are also typically higher than what she charges to sell it conventionally. “I have never once had a seller actually take them up on their offer.”

What fees do iBuyers charge?

iBuyer fees typically total 7-10% of the sale price, comprised of a 5% service charge, 1-3% in closing costs, and 1-2% in repair fees.

By comparison, real estate agents typically charge 5-6%, though this fee is negotiable. Realtors can help your home sell at or above fair market value, potentially letting you walk away with more. However, you pay for necessary home repairs out of pocket.

​Cash homebuying companies don’t charge repair fees, agent commissions, or most traditional closing costs. Investors typically offer 70-80% of your home’s after-repair value, leaving room for them to renovate and resell for profit.

What are the best iBuyers near me?

iBuyers operate primarily in larger cities with strong price appreciation. Below are some of the top iBuyers by market coverage.

What is the best iBuyer alternative?

iBuyers vs. 'We buy houses' companies

‘We buy houses’ companies are better alternatives for homes in poor condition. You sell your home as-is in a cash sale, but typically cap offers at 70% of the home’s after-repair value.

Closings are fast — sometimes less than two weeks — giving them an edge if you need to sell immediately. If your home is in good condition and you can wait, you’ll likely net more with an iBuyer.

iBuyers vs. buy before you sell program

If you need to move on a set timeline without sacrificing equity, consider a buy-before-you-sell program.

Companies like Knock, Orchard, and Flyhomes offer bridge loans that help you secure a cash advance or short-term loan based on your current home equity. This lets you buy a new home before selling your current one and make offers without home-sale contingencies. In competitive markets, having fewer contingencies can give your offer an edge.​

Buy-before-you-sell programs vary by company, so research specifics carefully. Expect service fees, closing costs, and potentially loan origination fees, rent, or mortgage payments.

If you don’t want to buy another property or list your home traditionally, iBuyers may be a better fit.

iBuyers vs. realtors

iBuyers rely on technology and standardized procedures, so services may be less personalized.

Experienced local realtors can adjust strategies to suit their clients, including those who need to close on a specific timeline or avoid traditional sale hassles.

Agents can also help you get the highest possible sale price by exposing your listing to a broader buyer pool, creating competition that drives prices up.

However, you may need to make repairs before listing, stage your home, and conduct showings and open houses. Some realtors offer discounted commission rates while still providing a full range of services. iBuyers offer a hands-off approach, buying directly and as-is.

Selling to an iBuyer vs. a listing with a realtor

FAQs about iBuyers