- The so-called iBuying companies buy private homes themselves.
- Their main advantage is to guarantee much faster transaction times.
- Like Homeloop, they are booming in France even if they are still far from competing with real estate agencies.
They are called Homeloop, Dili or Vendez-votre-maison and hope to “revolutionize” the French real estate market. In full development, these so-called “iBuying” companies are inspired by a concept from the United States: rather than serving as an intermediary, like a traditional real estate agency, the “iBuyer” company acquires itself accommodation put up for sale by an owner. It will then try to resell it, if possible with a capital gain.
For the individual seller, the interest of these new operators would be both “time savings” and “less risk taking”. "We are offering a firm purchase offer within 48 hours," explains Aurélien Gouttefarde, founder of Homeloop, the French leader in the sector. We then manage to close the sale in about a month and a half [against a minimum of three months generally]. Our record is three weeks. We manage to reduce the delays because we have no bank credit to apply for and because we always work with the same notaries. As we are professionals, we also do not have the possibility to change your mind after the promise to sell, there is no bad surprise for the seller. "
Service charges and estimate
For the individual buyer, doing business with a professional with a reputation to defend would also be considered "more reassuring", especially since the property is previously "checked" by experts from the company.
However, these services have a counterpart. Homeloop charges between 7% and 8% on each transaction. A higher commission than most real estate agencies. The room for maneuver on the estimated price is also limited. "We don't negotiate very much," admits Aurélien Gouttefarde. But this is because the value we offer is as close and as reliable as possible to the reality of the market. Our goal is not to buy as low as possible. "
Unlike the merchants of goods, the "iBuyers" are only interested in housing in good condition. To fix the price of a house, they ask the sellers to provide the property information themselves via an online form. A videoconference or face-to-face visit is used to refine the estimate.
"They need to make volume"
"This is not a scam," says François Gagnon, president of the Era real estate agency network and an expert on the phenomenon in the United States. This is another operating model that responds well to the interest of certain customers, those who are in a hurry in particular. What we observe is that these companies need to make volume to earn money because their margin is relatively low, a fortiori in France where regulatory costs are high. For the model to work, it must be relatively automated. The risk must also be limited, which means that goods cannot be bought too expensive. "
After having “prowled its model” in Paris, Homeloop has been deployed in Lille, Nantes and, since April, in Lyon. It makes around twenty purchases per month on average and is expected to exceed 60 million euros in transactions in 2020. A volume of business that it hopes to double next year. Before attacking Marseille, Toulouse, Bordeaux, Nice and Montpellier.
“The crisis has slowed down our business plan but we believe strongly in the project, defends its director, Aurélien Gouttefarde. Banks are less reactive when issuing a mortgage. We can help owners sell quickly and with confidence. "
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