Offerpad is part of the growing iBuyer trend in the real estate industry. They'll make an all-cash offer on your home and let you skip time-consuming and stress-inducing steps that can come with the traditional home selling process.
But in exchange for speed and convenience, Offerpad charges high fees and often makes offers well below market value.
For some sellers who want the speed and simplicity, Offerpad's higher costs may be worth it. However, it's smart to explore all your options to see if you'd be able to still sell your home quickly and at a higher price.
Get in touch with a top-rated agent for free advice on whether working with an iBuyer like Offerpad or partnering with an agent can give you the best outcome when selling your Dallas home.
To learn more about how Offerpad works and if it's the right option for you, here's everything you need to know about selling to Offerpad in Dallas.
What is Offerpad?
Similar to other iBuyers, Offerpad provides a quick and convenient alternative to the traditional selling process. Offerpad's approach allows you to skip the hassle of finding a qualified buyer, staging and prepping your home, conducting open houses, dealing with negotiations, and waiting for the buyer's loan to be approved.
In November 2018, Offerpad expanded its operations into the Dallas-Fort Worth market, making Dallas it's largest operating market.
To sell your Dallas home to Offerpad, you start by filling out a short online form providing photos and your home's information such as square footage, age, number of bedrooms and baths, and any recent upgrades or improvements you've made.
Offerpad will take the information you provide and, with its proprietary valuation algorithm, determine your home's value. Within 24 hours you'll receive an all-cash offer on your home and if your home doesn't have an HOA, you can close in as few as 10 days in Dallas.
But to get the speed and simplicity with Offerpad, it charges Dallas residents a service fee. Depending on your property, your service fee can range anywhere between 6% and 10%, but the average is 7%.
Additionally, to meet their bottom line, Offerpad follows the typical iBuyer business model — they'll make you a low offer under market value, fix up any necessary repairs, and then resell your home for profit.
How does selling to Offerpad in Dallas work?
Offerpad is all about streamlining and simplifying the selling process. To give you an idea of what to expect, here's a step-by-step breakdown of their selling process.
1. To request a free offer from Offerpad, simply fill out a form providing information on the condition of your home as well as any features and upgrades that may increase its value. You can also include photos of the property.
2. Offerpad will use their proprietary algorithm to value your home and send you an all-cash offer within 24 hours.
3. If you accept their offer, you'll move forward and decide on your anticipated close date as well as any additional services you'd like to include such as their free moving services or extended stay. In Dallas you can choose a closing date as soon as 10 days or as far away as 90 days.
4. Once you sign the online purchase agreement, you'll be under contract and Offerpad will schedule your in-home inspection.
5. An Offerpad team member or a licensed property inspector will come out to assess your home's condition and determine what repairs are needed, which you can then pay to fix or let Offerpad take care of making the repairs.
6. After the repairs are done, Offerpad will do a final walkthrough. If your home looks good, Offerpad will close on your home, transfer the title, and pay you the agreed upon price.
Does Offerpad pay a fair price for Dallas homes?
Typically with iBuyers like Offerpad, you won't see an offer for the full value of your home. To earn a profit, Offerpad will make you an offer below market value and then turn around and resell for a higher price.
And while Offerpad's offer may be close to fair market value, on average you'll lose about 7.5% of your home's value.
For example, taking into consideration the 7.5% loss, on a Dallas home with a median sales price of $282,800, Offerpad's offer will be around $261,590 — that's a loss of $21,210.
If you're willing to give up that much equity in your home, you'll be able to sell your home quickly and have the certainty of a guaranteed sale with no chance of a buyer backing out due to financing or cold feet.
And as Dallas' market has cooled, favoring a buyer's market, a guaranteed sale with Offerpad may be appealing to some sellers who don't want to compete for fewer buyers or risk their home staying on the market for a long time.
How much are Offerpad fees in Dallas?
On average, Offerpad charges a service fee of 7%. The company uses the money to cover the 3% buyer agent's commission when they resell, concessions to the buyer, holding costs, maintenance fees, taxes, and other extraneous listing costs. And as these fees vary depending on your property, your service fee may increase ranging anywhere from 6% up to 10%.
For example, if you accept Offerpad's offer of $261,590, with the average service fee, you can expect to pay $18,311 in fees. But depending on your property, your service fee could add up to $26,159.
And on top of Offerpad's service fee, you'll also be responsible for any repair costs as well as closing costs that can include title insurance, escrow fees, HOA fees, taxes, and transaction fees that can range anywhere from 1% to 3% of your sales price.
Pros and Cons of Selling to Offerpad in Dallas
- Speed: Along with making you an offer within 24 hours, Offerpad can close on your home within 10 days, allowing you to sell your home fast. This can be important for Dallas sellers as since the market has cooled and homes now spend on average 53 days on the market — the highest it's been in years.
- Convenience: One of the biggest draws of working with Offerpad, is their simple selling process that allows you to avoid a lot of the time-consuming and stressful work that comes with listing your home. With Offerpad you don't have to worry about finding a buyer, staging and prepping your home, open houses, or negotiations.
- No hidden costs: Offerpad is upfront with all of their fees. Even if their costs seem higher, they're transparent with their pricing so you're able to make an informed decision when deciding how to sell your home.
- Certainty: With their all-cash offer, Offerpad guarantees your sale will go through. You won't have to worry about having a buyer's financing falling through at the last minute.
- Lower offers: To meet their bottom line, Offerpad won't offer you full market value for your home. You can expect an offer of around 7.5% below market value.
- Service fees: Especially when compared to a standard 6% agent commission, Offerpad's service fees are on the high end with an average of 7%. However, depending on your home you could see fees as high as 10%.
- No negotiations: While in a traditional real estate transaction, you're able to negotiable most everything, with Offerpad, you won't be able to negotiate price, repairs, or closing costs.
- Strict criteria: Offerpad will only purchase homes that meet their specific requirements. Your home must be a single-family home, condo, or townhome, and be in decent condition. Your home must also be valued under $500,000 or $600,000 depending on your market, built after 1960, and must sit on a lot no larger than one acre.
Top Alternatives to Offerpad in Dallas
One of the other major players in Dallas is Opendoor, often credited with launching the iBuyer movement and providing a more streamlined and convenient selling experience thanks to third-party partnerships and integrated services.
Opendoor will make you an all-cash offer on your home, (often closer to market value than other iBuyers competing in the market), they'll take care of the repairs on your home, and offer flexibility on your closing date so you can move on your schedule and avoid paying a double mortgage.
Before you make your final decision on selling your home, it's worth talking with an experienced real estate agent who can provide recommendations and help you explore all your options so end up with the best outcome possible.
Get in touch for a free, no-obligation consultation with an experienced agent who will help you navigate the best way to sell your home in the Dallas market.