Want to sell your home instantly? More companies are offering homeowners cash on the spot, but this supposedly stress-free option can come at a cost.
Recently retired and widowed, Linda Fraley wanted to sell her home fast.
Fraley said she needed to downsize, "This home was great for family gatherings when we had a lot of people, but then it became just kind of me." But the idea of cleaning and fixing up her house, finding a real estate agent, and waiting weeks if not months for a buyer was too stressful. She turned to the real estate website Zillow, which offered to purchase her home directly for cash.
Zillow, Redfin, and Opendoor are just some of the companies buying up homes in more than a dozen U.S. cities.
CBS Correspondent Laura Podesta asked Glenn Kelman, CEO of Redfin, if Redfin is now the Uber of real estate? Kelman said, "You can look at it that way." He acknowledges convenience comes at a cost and offers are often below market value.
"Whether it's from Zillow or Redfin, now when we make an instant offer we charge a premium for that service," according to Kelman.
The National Association of Realtors said that premium may be too costly for sellers. Dr. Lawrence Yun is the National Association of Realtors' chief economist.
"They would lose out on the price because the business model for direct purchase is they are buying it on the cheap, so it could be 10% below market price, some cases 15 percent," according to Dr. Yun.
Fraley says she's happy with the process and the ability to move on so quickly, "I'm so relieved. I'm so happy."
Zillow is now fixing up her old house and preparing to resell it for more money.