Wednesday, November 16, 2022 / by Sean Collins
The Evolution of iBuyers in Real Estate Investing
A tidal wave of emerging real estate tech giants including Zillow, Opendoor, and Realogy have been forced to drastically cut back or altogether shut down their fledgling iBuyer investment programs. Redfin is the most recent to drop the axe on this department.
Their investment strategies were obviously engrained with overly-aggressive growth ambitions. Volume goals were then in effect pressed upwards as a misplaced top priority. The result was that their underwriting models were then forged with oversimplified analysis and idealistic expectations in order to simply “get the deal”. This in turn led to a frenzy of greed buying that took reign at the expense of properly assessing risk.
The manifestation of this algorithm was a blind money grab through property control. However, detached calculations from a distant desk throne are unfeasible for real estate investing. The power of such technology has met its match with actual industry expertise. With the exce; ...
Their investment strategies were obviously engrained with overly-aggressive growth ambitions. Volume goals were then in effect pressed upwards as a misplaced top priority. The result was that their underwriting models were then forged with oversimplified analysis and idealistic expectations in order to simply “get the deal”. This in turn led to a frenzy of greed buying that took reign at the expense of properly assessing risk.
The manifestation of this algorithm was a blind money grab through property control. However, detached calculations from a distant desk throne are unfeasible for real estate investing. The power of such technology has met its match with actual industry expertise. With the exce; ...