Cruising under the radar, Flyhomes, which offers cash-purchasing power to buyers and price guarantees to homesellers, has been growing rapidly with variants on the iBuyer model.
Flyhomes, an iBuyer that offers cash-purchasing power to buyers and price guarantees to homesellers, has announced its expansion into Los Angeles and Orange County, California, as well as Boston and Portland, Ore.
Opendoor, Zillow Offers and Offerpad, iBuyers that quickly buy and resell homes with cash, have hogged much of the industry spotlight over the past few years. But Flyhomes has been growing fast under the radar by offering variants on the iBuyer model — one of which has been adopted by both Opendoor and Offerpad.
“Our approach—which brings every step of the process under one roof—helps buyers separate fear from risk to make more informed home-buying decisions,” Flyhomes CEO Tushar Garg said in a statement.
Founded in 2015, Flyhomes appears to have secured at least $39 million in equity financing, as well as $141 million in debt for snapping up homes on behalf of customers. It has been operating primarily in Seattle and the San Francisco Bay Area.
The company’s services are particularly well suited for hot markets like these, where cash-purchasing power can give buyers a leg up over the competition. Flyhomes, which is a licensed real estate brokerage, selected its expansion markets for their competitive nature, the company said in a press release. For example, homes are only on the market in Boston for an average of 15 days, compared to a national average of 42, according to Flyhomes.
Flyhomes reports having helped more than 1,000 clients buy and sell over $1 billion in real estate.
Two of Flyhomes services provide cash-purchasing power to homebuyers. If a buyer chooses “Cash Offers,” Flyhomes will purchase a home on a buyer’s behalf. The buyer then moves in and pays rent to Flyhomes until they secure financing to buy the property from Flyhomes. If a buyer chooses “Guaranteed Offer,” Flyhomes will add an addendum to the buyer’s offer in which it promises to purchase the home if the buyer’s financing falls through.
In August, the startup announced a third offering for homesellers, “Trade Up.” For sellers who select this service, Flyhomes will buy a new home on their behalf and move them into it. Then it will try to resell the client’s old home. If it can’t within 90 days, it will then purchase the home itself for a previously agreed-upon guaranteed price — typically between 90 and 95 percent of what Flyhomes thinks the home is worth, Garg told Inman in August.
Flyhomes also provides in-house title and mortgage services, allowing it to provide an “end-to-end” experience to clients.
Atlanta-based iBuyer Knock offers a similar trade-in service. Opendoor and Offerpad, which specialize in quickly buying and reselling properties on request, have also recently unveiled cash power-purchasing services for buyers.
This points towards on overarching industry trend: convergence. iBuyers and brokerages are mixing and matching new capital-intensive home-selling and purchasing services, gradually blurring the lines between them.
Inman has reached out to Flyhomes for comment.