iBuyer Market Statistics

Last Updated: November 7, 2021

Report Highlights. iBuyer market statistics reflect a volatile moment in the industry; market share increased 233% in the first 6 months of 2021, but some companies may have overpurchased and overpaid.

  • Direct-buyer companies or iBuyers control up to 1.0% of the national metropolitan real estate market.
  • iBuyers offered an average 104% of market value for homes in the first half of 2021.
  • The median iBuyer purchase price is $284,500.
  • Up to 9.2% of iBuyer sales are purchased by a growing number of institutional investors, such as rental companies.
iBuyer Home Purchase Rates by Fiscal Quarter
Quarter Rate of Home Purchase* YoY Change
2021 Q1 1.9% -26%
2020 Q4 1.8% -55%
2020 Q3 0.7% -85%
2020 Q2 0.4% -89%
2020 Q1 2.6% -7.3%
2019 Q4 4.0% +4.3%
2019 Q3 5.0% +72%
2019 Q2 3.7% +92%
2019 Q1 2.8% +129%

*The number of houses purchased by iBuyers expressed as a percentage of all homes sold in that quarter nationwide; rate of purchase does not necessarily reflect market share.

National iBuyer Market Statistics

iBuyer market performance appears to have declined in the latter months of 2021 though financial specialists suggest the iBuyer business model may still be profitable.

  • iBuyers’ median purchase price is 24% lower than the nationwide median home price of $375,639.
  • iBuyer home purchases were down 41% year-over-year (YoY) in 2020’s fourth quarter (2020 Q4).
  • iBuyer purchases declined by an estimated 88% in 2020 Q2.
  • Realtors report 2% of homes they sold from May to July 2021 were purchased by iBuyers.
  • Real estate agents receive an average 2.4% commission when they sell to an iBuyer.
  • Up to 87% of home buyers still use a real estate agent.
Number of iBuyer Home Purchases by Fiscal Quarter
Quarter Homes Purchased YoY Change
2021 Q1 4,383 -6.1%
2020 Q4 3,634 -41%
2020 Q3 1,798 -78%
2020 Q2 825 -88%
2020 Q1 4,667 -3.6%
2019 Q4 6,718 +28%
2019 Q3 8,130 +99%
2019 Q2 6,789 +100%
2019 Q1 4,842 +137%

Regional iBuyer Market Statistics

iBuyers are most active in southern states in the U.S. Phoenix, home to Opendoor and Offerpad, continues to see significant activity in the iBuyer market.

  • North Carolina had the top 3 iBuyer markets in 2021 Q1, with market shares averaging 2.7%.
  • Phoenix, Arizona had the largest marketshare in 2020 Q4, with 2.1% of home sales going to iBuyers.
  • Also in Phoenix, iBuyers purchased up to 6.1% of homes sold in 2018.
  • In some markets, iBuyers take 14 days to sell an average home.
Top 10 iBuyer Markets
Metro Area Market Share 2021 Q1 Market Share 2020 Q4
Raleigh, NC 2.9% 1.9%
Charlotte, NC 2.7% 1.5%
Durham, NC 2.6% 1.4%
San Antonio, TX 2.6% 1.5%
Tuscon, AZ 2.3% 1.2%
Phoenix, AZ 2.2% 2.1%
Atlanta, GA 2.1% 1.6%
Fort Worth, TX 2.1% 1.1%
Las Vegas, NV 2.0% 1.4%
Dallas, TX 1.8% 0.9%

iBuyer Company Statistics

iBuyer companies use algorithms to evaluate homes for purchase and calculate their market value. After a free home inspection, many companies will make an offer within 48 hours.

  • The unofficial industry-wide standard service fee is around 6%.
  • Major iBuyer companies posted net losses in 2021 Q1 of up to $109,800 per home.
  • Opendoor sold more homes than Zillow and Offerpad from 2019 to 2021 Q1.
  • Zillow Offers reported significant losses in 2019 and 2020.

“We’re being very aggressive when it comes to buying homes right now — it’s all gas, no brakes.” Myron Curry, Senior Investment Specialist at RedfinNow

Opendoor

Opendoor is one of the most well-established iBuyer companies with locations in over 40 major cities.

  • Opendoor charges a 5% service fee.
  • Buyers’ agents can get a 1% commission.
  • Opendoor paid out more than $133 million in commissions in 2019, up 166% YoY.
  • Typically buys homes between $100,000 and $600,000 (but has gone as high as $1.4 million).
  • Purchases single family homes or townhomes.
  • In some markets, Opendoor will purchase duplexes or condominiums.
  • No prefabricated or mobile homes.
  • Opendoor will not purchase homes on a flood plane.
  • In general, homes must be built after 1930 with a maximum lot size of 1 to 2 acres according to service area.
  • Opendoor sold 7,000 homes in 2018.

Offerpad

Offerpad became a publicly traded business in September 2021 with a $2.7 billion valuation.

  • Available in 24 major metropolitan markets across 16 states.
  • Service fees range between 4% and 7% depending on the local market.
  • Buyers’ agents can get a 3% commission.
  • Offerpad purchases single family homes, townhomes, and condominiums.
  • No prefabricated or mobile homes.
  • Offerpad will not purchase homes valued at more than $1 million.
  • In general, homes must be built after 1960 with a maximum lot size of 1 acre.
  • Offerpad claims to buy or sell a home every 10 minutes.

RedfinNow

Redfin is one of the top brokerage sites nationwide; its iBuyer service is RedfinNow.

  • Available in 10 states and in Washington, D.C. with plans to expand.
  • RedfinNow charges service fees ranging from 5% to 13%.
  • Offers are valid for 5 days.
  • Sellers may select a closing date between 10 and 60 days after RefinNow’s final offer.
  • RedfinNow does not purchase homes in age-restricted communities.
  • The maximum lot size is 0.5 acres.
  • No manufactured or mobile homes.
iBuyer Homes Purchase Requirements
What iBuyers Want What iBuyers Don’t Want
Ready-to-market with no repairs or renovations needed. Fixer-uppers or homes that require extensive work.
Median value homes that are close to the average fair market price. Luxury homes or homes priced higher than the area’s median value.
Basic or standard blueprints with no customizations. Unique or custom features or fixtures.
Modern construction though not necessarily new. Old with construction dating back 50 years or more.

Zillow Offers

Throughout 2021, Zillow Offers’ algorithm approved more home purchases than ever. In November 2021, Zillow announced it would end its iBuying program after less than 3 years in operation.

  • Zillow Offers sold 786 in 2019Q2, up from 414 in the previous quarter.
  • Zillow increased iBuyer sales 89.9% from 2019’s first to second financial quarter.
  • Zillow claims it plans to sell 7,000 homes for $2.8 billion – an average of $400,000 per home – to institutional investors.
  • Traditional listings on Zillow sold for 0.09% more on average than similar listings from Zillow Offers.

Sources

  1. Opendoor 2021 Report: The Hearts & Minds Behind Today’s Housing Market
  2. RedFin News, iBuyer Home Purchases Inch Back Toward Pre-Pandemic Levels
  3. U.S. Census Bureau, Business & Industry: New Residential Sales
  4. United States Securities & Exchange Commission, Opendoor Technologies Inc. Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
  5. CNBC, Zillow Says It’s Closing Homebuying Business, Cutting 25% of Workforce; Earnings Miss Estimates
  6. Offerpad, Seller FAQs
  7. Opendoor, What Types of Homes Does Opendoor Purchase?
  8. Redfin Now, iBuyer Market Continues Slow Recovery, With Decline In Home Purchases Narrowing to 48% In the Fourth Quarter
  9. Zillow, What is Zillow Offers?
  10. Zillow, iBuyers Are Helping People Move in Record Numbers
  11. iBuyer Offerpad goes public at $2.7B valuation
  12. RedfinNow FAQ
  13. Offerpad and Its More Profitable Flavor of Buying
  14. National Association of Realtors, Economists’ Outlook