William Raveis ain’t no stinkin’ iBuyer
Residential brokerage and mortgage lender William Raveis is buying its clients’ homes across New England, the tri-state area and Florida. But don’t confuse its new program with iBuying – they’re looking to solve the sell-before-you-buy dilemma in a different manner.
“We’re giving them an offer to unlock their equity and move forward to make an offer on their next home,” Ryan Raveis, co-president of William Raveis Real Estate, Mortgage & Insurance (WRRE), said in an interview with HousingWire. “We’re taking title to the house, and the big difference between what we’re doing with Raveis mortgage and what an iBuyer program like an Opendoor, Zillow looks like, is we’re passing along 100% of the value that we create from the time we forward their initial equity to them, to the time that it’s sold on the open market.”
He added: “We’re giving them 100% of the value creation so they make out better in the end, as opposed to an iBuyer program where it’s their business model to buy low and sell high and make the difference in between. Ours is to buy at the market price and sell it at higher-than-market price and give 100% of the upside to the consumer.”
With “Raveis Purchase,” which officially launched earlier this month, WRRE will acquire the home-seller’s property for an initial payment of up to 80% of the current value of the home, which unlocks the majority of the equity and enables the seller to settle any mortgages.
Using another new tool, called “Raveis Refresh,” WRRE prepares the home for sale by making any necessary upgrades and renovations to maximize the home’s value and ensure that it sells above market average and quickly. Its agents are tasked with marketing and selling the home, using their local expertise, Raveis said.
Once the home sells, the homeowner receives the full proceeds. The program is available in Florida, New York, New Jersey, Connecticut, Massachusetts, Rhode Island, Vermont, New Hampshire and Maine.
Every deal is different – the amount of equity they forward and the fee that they charge for the service. “Typically the fee might be 3%, somewhere in that area, for the purchase program itself,” Raveis said. “And then we have our agent commission.”
In essence, the program allows WRRE’s sell-side clients to compete with cash-buyers, iBuyers and investors for the little inventory that’s out there when they’re ready to buy. WRRE also will help them buy, finance and insure their next home purchase, with mortgage closing times in as few as eight days, considerably faster than the industry average.
“We do that on purpose because we know that this is the type of market we’re in and we want our agents to win deals,” Raveis said. “Agents that don’t have that advantage are going to lose, they’re going to lose out to other offers.”
In determining how much WRRE will pay to buy the home from a client, Raveis said he “could have a million data scientists creating algorithms of what the right home value is, and none of them would be right because the right value for the home is what the market is willing to pay.” He also noted that the firm has a considerable amount of equity deployed, but did not offer specifics as to the dry powder.
The Raveis Purchase program was rolled out about a month-and-a-half ago. WRRE has offers under contract plus more in the pipeline. “We’re making offers on homes as low as $150,000 and as high as $5 million,” Raveis said.
In the latest RealTrends 500 ranking, William Raveis placed ninth among real estate brokerages with $16.2 billion in closed sales volume in 2020. It was the 11th-most active firm with 26,959 transaction sides. The Connecticut-headquartered brokerage is the biggest player in New England. Founded by William Raveis 47 years ago, the firm is still family-owned and run, with Ryan and his brother Chris serving as co-presidents.
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