A new study finds that iBuyers, or institutional buyers like Redfin and Opendoor, have a growing presence in the Phoenix real estate market.
iBuyers make instant cash offers to qualifying home sellers and close a sale without listings within days, and then re-sell the property for a profit. According to Redfin's analysis of public records data, iBuyers in Phoenix bought about 6.9 percent of homes sold in December 2018, a 2.7 annual increase. Consequently, Phoenix is home to the highest market share for iBuyers of all U.S. metros. iBuyers had an overall share of 4.8 percent in Phoenix in 2018, at least two percent higher than in Dallas and Atlanta, markets that are also popular with iBuyers.
The softening market in Phoenix is likely to have similar repercussions on institutional buyers as it does on traditional homebuyers and home sellers. Like traditional homebuyers, iBuyers are able to take advantage of relatively low price growth in Phoenix—but when they are going through the selling process, it may be more difficult to find a buyer or get top dollar for a property than it was last year.