By KIMBERLEY HAAS
As sellers become savvier about return on investment opportunities before putting their house on the market, the presale home renovation company Revive is expanding nationally.
Leaders at the California-based business announced on Tuesday that they have partnered with NextHome, a real estate franchise with more than 5,500 agents in 610 offices across 48 states.
“Presale renovations offer homeowners a $300 billion additional profit opportunity,” Dalip Jaggi, Revive co-founder, said in a statement.
Sellers can leave between 15% and 20% of potential profits on the table when selling a home as-is and, on average, earn $186,000 more than the cost of their renovations, Jaggi noted.
Tuesday’s announcement comes less than a month after it became public that Revive acquired HomePrep, a Washington, D.C., area company in the presale renovation space.
In December, company leaders announced they are partnering with The Keyes Company in Florida, an independent and family-owned brokerage.
Mike Pappas, Keyes’ CEO and president, said at the time that home sellers who want to maximize their returns can no longer list a home as-is in today’s market.
“By offering our agents easy access to Revive’s supported network, renovation expertise, and services for their clients, every seller can list a move-in ready home, quickly and on budget, and see a better return,” Pappas said in a statement.
Michael Alladawi, Revive’s CEO and founder, recently sat down with The Mortgage Note to talk about the business.
Alladawi said as a professional builder and flipper it took him years to build relationships and systems before starting Revive.
“My goal, it was and still is, to transfer those systems and relationships that you could build at scale to the person who is only doing one project in their life, a consumer who just wants to sell their home and they want to make sure they extract all the equity out of it,” Alladawi said.
Alladawi said this process can be overwhelming for the average seller.
“I think real estate is probably the most relevant thing in all of our lives,” Alladawi said. “Our homes are probably the single biggest way for us to build wealth and pass wealth down to future generations, so real estate and people’s assets are really important and the truth of the matter is, people leave a lot of money on the table when they sell their homes because they’re not up to what today’s buyers want.”
Alladawi said the homes in America are aging.
“There are a lot of homes coming to market that have deferred maintenance or are not just up to today’s buyers’ turnkey standards,” Alladawi said.
Alladawi said they front the money to contractors and wait to get paid back through the sale of the homes. Homeowners have twelve months to sell.
“It’s not a loan, so there is no interest or fees associated with it,” Alladawi said.
Alladawi said Revive has grown in the way that it has due to its partnerships with brokerages in multiple states.
“They want us to be there. They want to offer this service to their agents,” Alladawi said.
Alladawi pointed out that this type of service is now standard in many markets.
“If you are a realtor who is not offering this as a solution, then you’re at a disadvantage,” Alladawi said. “Presale renovation is the single most powerful tool an agent can have in their toolbox to help their clients and to be competitive in the marketplace.”
Well-priced turnkey homes will be hard to come by this spring, according to analysts at Realtor.
Clare Trapasso, executive news editor of Realtor.com, wrote in an article published on Monday that there will be competition for the few move-in ready homes going up for sale in popular neighborhoods.
Trapasso pointed out that the number of homes for sale was up 67.8% year over year in February, according to their data, but advised buyers to not get excited.
“Most of these homes have been sitting on the market for what might seem like an eternity, unable to attract buyers because they’re fixer-uppers, dated, overpriced, remotely located, or utterly lacking curb appeal,” Trapasso wrote.
With homebuyers and sellers feeling pessimistic about the market due to affordability and job security concerns, Fannie Mae Senior Vice President and Chief Economist Doug Duncan says consumers on both sides of the transaction appeared to be feeling cautious about the housing market last month.
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