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Buying a home sight unseen
ZACK Fountas bought a new one-bedroom apartment in White Plains, New York, from his home in Chicago, without ever having set foot inside the building. The 850 sq ft apartment is within walking distance of the train station, and with an asking price of US$155,000, it appeared on paper to have almost everything that Mr Fountas and his fiancee were looking for, including a dishwasher.
During an open house last summer, his sister-in-law and Joe Muller, an agent with Julia B Fee Sotheby's International Realty, gave Mr Fountas a tour using FaceTime.
Mr Muller showed him around with his iPhone and then emailed a link with listing photos and comparable sales nearby. Mr Fountas, who had not seen any other places in person, bid US$142,000, and his offer was accepted.
Six weeks later, it was time to take a tour in person. "I think I was sweating because I was like, 'Oh, my God, what if he doesn't like it?'"Mr Muller said. "He'd have lost his deposit."
Mr Fountas, who was moving to New York for a job as a risk manager after earning a business degree, said that he was not disappointed: "Having seen it through the phone, it was what we were expecting."
Most buyers want to see a place in person at least once before committing. A home, after all, is usually an emotional purchase, with intangibles like the feeling it evokes key to a buyer's attraction. But a growing number of house hunters across the country are making the biggest financial decision of their lives sight unseen.
According to a recent survey by Redfin, a national online real estate brokerage with more than 1,000 agents, 20 per cent of buyers said they submitted an offer on a home without visiting it first. And in a survey of 45 New York City-based agents conducted by Realtor.com, more than half said that in the past six months they had worked with at least one buyer who was purchasing a primary home without visiting it first.
Of course, out-of-towners looking for investment properties - especially in hot markets such as New York City and Los Angeles - have long bought homes sight unseen. (Their decisions are often based more on profit-driven factors such as average rents and price-per-square-foot comparisons than emotional considerations.) And when it comes to brand-new construction, buyers regularly commit with little more to go on than renderings and floor plans.
But these days, agents said, more primary homebuyers purchasing already-built properties are willing to go in blind, in part because technology has improved the remote-viewing process. And it tends to happen more in markets where properties sell quickly, putting out-of-town buyers at a particular disadvantage.
Graham Candish was living in Geneva when he accepted a job as an innovation director for a beauty company that would require him and his family to move to New York. His agent, Nuno Ribeiro of Redfin, showed him several homes in the New York area when he was in town on business, but nothing fit the bill. After returning to Geneva, he did some research on his own using Google Street View to get a sense of neighbourhoods. He perused websites like Zillow to learn property sales history, something that he was not able to do when buying a home in Europe, where less information is available through public records. "There are no secrets here," he said.
Having identified the French language school in Mamaroneck that his 12- and 14-year-old son and daughter would attend, he set about looking for a home within a 10-minute drive. Mr Candish said that he found a Tudor-style home in Larchmont listed for US$1.32 million near the school and within walking distance of the train station. "That was the main thing, the right location," he said. "And it ticked most of our boxes, including having the potential to renovate it and make it more modern."
He put in an offer of US$1.25 million, which the seller accepted. Mr Candish and his family did not fly back to New York to see the house until partway through the closing process, with their deposit at stake. "At that point, we were US$125,000 in," he said. One thing that he did not realise about the home until he saw it in person was that the basement was very damp and dark - "much more so than in the photographs", he said. "They massively overexpose the photographs and turn on all the lights. You get there in person, and it's not as bright as you'd imagine." Also hard to capture in photos: "It smells like a basement." He has since remodelled the space to make it more livable, and said that he is generally happy with his decision to buy the home.
Real estate agents said that the growth in sight-unseen purchases is partly driven by low inventory and high demand. In the hottest markets, houses and condos can go into contract within 24 hours of listing. Leslie Turner, a real estate broker in Charleston, South Carolina, said that homes in the downtown area are selling so quickly that it is challenging to get clients in for tours if they do not live in town and have immediate availability. "By the time you get on a plane to go see it, it'll be gone," she said. When she received a call in December from a buyer in New Orleans who had been searching listings online and was interested in a US$430,000 condominium downtown, her advice was blunt: "I told them, 'You don't have time to wait,'" she said.
Some believe that a growing comfort with buying almost everything else online is affecting the way people shop for real estate. "There's an e-commerce mentality sinking into the American consciousness," said Glenn Kelman, the chief executive of Redfin. "Zappos popularised the idea that you can buy shoes online. I think it's true for almost any goods in America now." NYTIMES