On Tuesday, Nov. 2, an American online real estate marketplace company announced it will be closing the doors on its iBuyer program, a home-flipping business that started in 2018. The company struggled to sell houses for enough money to recoup expenses, reported Fortune. As a result, the company will be reducing its workforce by 25 percent.
The unpredictability in forecasting home prices far exceeded what the company expected, according to its CEO. Based on the company’s third-quarter earnings in 2021, it lost $339.2 million, which was influenced by the struggling iBuyer program. In comparison, the company reported a $39.6 million profit that same quarter in 2020.
iBuying is not a simple business venture to pull off effectively and at scale. It’s easy to turn a profit on houses when prices are sky high. However, online homebuying companies need a sustainable plan that will work even when the housing market cools. One algorithm for an entire country and with limited, non-localized support did not work well for one of the largest brands nationally.
That’s why Meridian Trust does things differently. Unlike this iBuying program, which started just three years ago, we have more than 15 years in the industry. To date, we’ve purchased tens of thousands of homes, townhouses, condos, apartments, and multi-family units.
Our team is also made up of licensed real estate agents. We understand the real estate market and the factors that influence it. Meridian Trust keeps a finger on the pulse of the industry, both nationally and locally.
We also have operations in the same states we serve — Florida, Georgia and Texas. This enables us to localize our strategy, ensuring that it’s customized to the area and not “one size fits all.”
Buying and rehabilitating homes helps to improve the communities where we live, work and play. This is particularly important to us because your communities are our communities, too.
To find out how much your property may be worth, give us a call at (954) 807-9087.