Real Estate Question

• pmoney25

  

  So while driving on my lunch break, I happen to be at a light next too a Hummer which seems to be a Realty Company. One of the ads says something like " Upgrade to one of our homes and we will buy your house."
  
  Is this common practice and if so, how does this work? I am not very well versed in Real Estate but this almost sounds like too good to be true. My wife and I are wanting to move mainly due to growing out of our current house. We have been here about 5 and half years. Our current home was really just meant to be a starter home.
  
  So question is, Do Legit companies do this? buy a home from someone to take it off their hands if they buy one of their houses that is worth more?
  
  I am aware of the Buy house for cash schemes you see on every street corner throughout town but this one seems like a real company. Checked out their website and a few people I know have actually heard of them.
• LJ

  

  Check and see if it was a builder or an agency. If it is a builder it's legit, if it is an agency I would do a TON of due diligence on it.
  
  Trinity homes around here does it as well as Diyanni, both very respectable.
• pinstriper

  A lot of builders will do it if they are tied to (connected to) realters. They can get you into the larger house at asking price, thenget you out of your house, turn it around and sell it for market value (easier to sell since it's a lower price range), and save a lot in real estate commisions a long the way (they'll pay out the buyers fee on the lower priced home instead of the higher one). Works out for everyone involved really.
  An example: a builder has a $250,000 spec sitting there for a year and can't get rid of it. You are trying to sell you want to move up in house and like it, you currently live in a $150,000 home. You trade basically with the real estate company representing the builder. The builder gets out from underneath his spec he can't sell and now has a $150,000 house instead of a 250,000 one to sell. You get into a bigger house. They sell the $150,000 house in an easier market, pay out a buyer's agent the 3% fee on $150,000 instead of having to pay 3% if someone would have bought the $250,000 house. They still got thier 3% seller's fee on the 250,000 house when that loan closed and their 3% on the 150,000 house....they, as the selling agents just sold two houses. Everyone made out just fine.