Over the past few years, brokers have watched with concern as new proptech attempts to cut them out of the homebuying process. Chief among these systems are a suite of iBuyers whose algorithms compare properties, determine price, and provide instant offers — sight unseen.
Proponents say they smooth over the complicated residential buying process, but critics say iBuyers often undervalue homes.
One company that’s made a name for itself by bucking iBuyer trends is EasyKnock, the New York-based sale-leaseback company. EasyKnock stands out for its strong ties to traditional brokers in a landscape that many see as anti-brokerage.
“Buying a home is too important a transaction for most people to rely on some algorithm,” said Jarred Kessler, CEO and co-founder at EasyKnock. “We know buyers and sellers value working with agents and brokers. In the dynamic market that is residential real estate, we know brokers and agents are in need of more products and solutions to offer clients more choice and options.”
EasyKnock’s programs help hurdle over the complexities of the homebuying process by providing clients quick access to their equity and the flexibility to move when they secure their next home. At the core of the company’s service is this simple proposition: EasyKnock buys homes from owners, letting them convert equity into cash while allowing them to stay in their as a renter.
Because it doesn’t require long waits for approval or mountains of paperwork, EasyKnock is a boon to buyers who need a better experience and options than an impersonal bank offers, and to agents who want a simpler, faster closing and higher deal volume.
Once homeowners receive the cash, EasyKnock doesn’t restrict how they use it. It can go toward a down payment on another home, paying off bills or renovations to attract a better final sale price. Most importantly, EasyKnock’s short term product MoveAbility allows sellers to access up to 80% of their home’s equity immediately — without moving out. They later receive the remaining amount at the open market price plus any appreciation.
As any agent knows, contingent offers are often the largest obstacles to successful home sales, especially in hot markets where sellers can expect unencumbered bids. EasyKnock eliminates the need for contingent offers since the sellers now have the capital they need to make a competitive offer on a new home. There are other upsides for brokers, too. Most iBuyers pay only 1 percent total commission. But EasyKnock’s short term bridge solution MoveAbility program pays market-rate commissions, and 1 percent as “instant” commission for referrals.
Homeowners, then, don’t have to worry about accepting contingent offers. Once EasyKnock pays off the mortgage, it rents the property back to the original owners, allowing them to stay until they find the right home or get the right bid. It eliminates the pressure to sell and improves the homeowners’ ability to make an offer. For agents, it enables smooth closings.
An additional benefit is available for homeowners who want to unlock equity as a way to make improvements to their homes. They can stay in the house up to 12 months until renovations are finished, or until they receive an offer at the right price. This provides a flexible timetable and the opportunity for sellers and agents to see a higher return.
By zigging instead of zagging with the rest of the market, EasyKnock’s strategy has seen success in just four years. Fresh off a $20 million Series B funding round, it partnered with industry heavyweight realtor.com to expand its reach.
And now, with a rising number of homeowners falling behind on mortgage payments, experts suggest many Americans will need new ways to access cash — which EasyKnock can provide.
“We’re not a lender,” Kessler, EasyKnock’s CEO, said. “We don’t have the same restrictions they do. We can help homeowners with credit or employment issues or who are already holding a mortgage. What people need now more than ever is more flexibility than they’ve been offered in the past.”
In an uncertain economic cycle, both brokers and homeowners need options. EasyKnock is well-positioned to provide them.