Did you buy more things sight unseen on Amazon last year than the year before? Me too. The photos of the item have gotten better so I can actually see the texture of the fabric, there are more photos showing more angles of the item and there are more reviews that answer all my questions. And, more importantly, it’s faster and easier to buy something online than having to get in my car, drive 30 minutes in traffic, pay for parking, waste time walking around a too crowded store trying to find what I’m looking for and then being disappointed if the item is sold out.
Turns out the same thing is happening with real estate. More people are buying homes online, sight unseen in real time, than they did last year. In 2016, 19% of homebuyers bought their home online without ever seeing it “in person.” Last year, 33% of all homebuyers bought their home online sight unseen in real time.
Redfin released its data on how many homebuyers purchased their home sight unseen. Here is what Redfin learned:
- By May 2017, +33% of all homebuyers in the country’s most competitive markets bought their homes sight unseen. This 33% compares to 19% homebuyers buying sight unseen in June 2016. This represents a 17% increase in sight unseen home buying in 1 year!
- 45% of all Millennials bought their home sight unseen in May 2017. This number compares to just 6% of all Baby Boomers who bought homes sight unseen! 33% vs. 6%!!! Pay attention realtors!
- In Los Angeles, a whooping 57% of all homebuyers bought their homes sight unseen!!!
What with virtual tours and iPhone Face Time, 3-D house touring is only going to increase. And, according to Redfin, “With no end to the housing shortage in view and more Millennials entering the housing market, the trend towards sight unseen bidding is likely to grow in 2018.”
Remember that buyers who have tight timelines to move, buyers from foreign countries and buyers who are investors join Millennials in being the likeliest sight unseen buyers.
Here is a list of the cities and percentages of sight unseen homebuyers. You’ll notice that the West is leading the way.
Los Angeles 57%
San Diego 46%
San Francisco 44%
Portland, OR 30%
Redfin is keen to note the importance of agents in sight unseen transactions. It says that video tours are only part of it…agents give (the buyers) the sounds, smells and textures of the home’s strengths and flaws so the buyer isn’t surprised when she/he sees the house for the first time.”
Personally, I’m not sure that buying a home online compares to a buying sweater online but…I’m not a Millennial.