When an iBuyer (instant buyer) makes you an offer, the headline number always feels like a discount. The right question is not "is the offer below market?" — it almost always is — but "is the discount worth what I save in time, repairs, showings, and dual-mortgage risk?" This is a net-equity comparison.
What an iBuyer offers
A typical iBuyer flow:
- You request an offer through the iBuyer's platform with photos, basic property data, and disclosures.
- An AVM-based preliminary offer arrives in 24-72 hours.
- After an in-home inspection, the iBuyer issues a final offer with deductions for repairs.
- You choose your closing date — typically 7-60 days out.
- You move out, the iBuyer takes possession.
What you get: speed, certainty, no showings, no contingency negotiations, and one closing date you control.
What you pay: a service fee (typically 5-8% of price), repair credits (median ~1-2% of price), and the price discount itself (typically 2-5% below realistic CMA).
What a traditional sale offers
A traditional listing flow:
- Listing agent prepares CMA, photos, MLS submission.
- Listing goes live; showings begin within days.
- Offers arrive; you negotiate price, contingencies, and closing.
- Inspection, appraisal, financing periods (30-45 days).
- Closing.
What you get: typically 3-7% higher gross sale price.
What you pay: ~5-6% combined commission (NAR settlement era — listing-side now ~2.5-3%, buyer side negotiated separately), ~1-3% closing costs (seller-side title, transfer taxes, etc.), holding costs while listed, repair credits commonly negotiated at inspection, and time risk if the deal falls through.
The dollar comparison
Take a $500,000 home in good condition.
| Line item | iBuyer | Traditional |
|---|---|---|
| Headline offer | $480,000 | $510,000 |
| Service / commission | -$28,800 (6%) | -$15,300 (3% listing) |
| Buyer agent comp | $0 | -$10,200 (varies by negotiation) |
| Repair credits | -$5,000 | -$3,500 |
| Closing costs (seller) | -$3,000 | -$5,500 |
| Estimated net | $443,200 | $475,500 |
| Days to close | 14-30 | 45-90 |
| Showings required | 0 | 15-40 |
In this scenario, the traditional sale nets ~$32,000 more — a meaningful spread. But the comparison flips when:
- You have already moved or will face dual mortgage payments. At $3,500/month carrying cost, three extra months erase $10,500 of the gap.
- The home needs visible cosmetic work that cannot be priced out at full market without staging and prep.
- Local market is slow (DOM > 60 days for comparable homes).
- You have a hard deadline (job relocation, medical, divorce) that forces accepting the first reasonable offer regardless.
When the iBuyer math works
The iBuyer is rationally the right choice when *any* of these apply:
- The iBuyer offer is within 4-5% of CMA and you place positive value on certainty.
- You are moving cross-country and the dual-mortgage risk is real.
- Your property has hidden issues that would cause traditional buyer financing to fall apart at appraisal or inspection.
- You are inheriting a property in another state and have no bandwidth to manage a listing.
When the iBuyer math does not work
When your home is in good condition in an active local market with comparables selling under 30 DOM, and you can manage 30-45 days of showings, the traditional sale almost always nets more. The exception is when you genuinely cannot afford the holding period.
A note on FHA 90-day anti-flipping
If you sell to an iBuyer, the iBuyer often resells within months. Federal regulation (24 CFR §203.37a) restricts FHA-financed buyers from purchasing a property within 90 days of the iBuyer's acquisition. This affects the iBuyer's resale model, not your sale — but it explains why iBuyers price acquisition discounts: the resale market is constrained for the first 90 days.
There is no universally "better" path. Run the actual numbers with your specific carrying costs and hard deadlines. A good listing agent can give you both: a CMA for the traditional sale and an iBuyer-equivalent net analysis side by side.