What It Means To Buy Sight Unseen & Why People Are Buying This Way
by Arnab Dey Real Estate 20 October 2022
Of all the recent real estate trends to emerge in the past half-decade, sight-unseen buying looks the strangest from an outsider’s perspective.
Imagine telling a real estate practitioner in the 80s that, in forty years’ time, there would be a sizable increase in people buying homes without ever stepping foot in them. They would scratch their heads.
But that’s the state of real estate right now. And in this article, let’s attempt to uncover the trend. What is sight unseen buying? And what are some of its driving factors?
What Is Sight Unseen Buying In Real Estate?
Sight unseen buying is when a homebuyer or real estate investor makes an offer without stepping foot in the property.
It’s not a new phenomenon. Overseas investors, peering into the upward-trending North American markets (and perhaps looking to stabilize their assets), have been buying sight unseen for years. And in the eras before accessible flight routes connecting remote communities, it wasn’t uncommon for buyers to invest before arriving in a new place.
However, recently the trend has skyrocketed. In the following sections, let’s look at a few underlying factors precipitating the trend.
The Knock-On Effects Of The Pandemic
The pandemic is the clear and apparent reason for increased sight-unseen sales. In COVID’s nascent stages, governments enforced strict lockdown rules, prohibiting in-person meetings like home tours.
These rules forced real estate agents to get creative with home showings, and they forced homebuyers – eager to capitalize on low-interest rates and high savings – to buy properties without stepping foot in them.
The pandemic is slowly fading (touch wood), but the trend continues.
The Rise Of Real Estate Technology
Of course, there would be no rise in remote buying without an equivalent rise in real estate technology. Real estate tech (known as “proptech”) was necessary to facilitate a large-scale trend toward sight-unseen sales.
Immersive tech like augmented and virtual reality allowed buyers to “experience” home tours from afar. And real estate digital marketplaces like Nobul allow buyers to choose the right real estate agent without conducting several in-person meetings.
According to Nobul CEO Regan McGee, “technological advancements are beginning to gain real traction in a stalwart industry that was initially skeptical.” This traction undoubtedly helped spur the remote buying trend.
Suburbanization, Shifting Migration Patterns, And Millennials
The research into recent migration patterns is still emerging; it can be challenging to piece together a straightforward narrative when patterns continue to change.
Nevertheless, most experts agree that we’re witnessing a wave of suburbanization, as well as a concentration in cities known for their “outdoor climates” like Miami, SoCal, Vancouver, etc.
These big swings in migration don’t just indicate that people are moving – they indicate that people are moving far. And far movers often buy remotely.
Lastly, you can partially blame the sight-unseen trend on millennials (that oft-blamed demographic). Now the largest buyers of real estate in North America, millennials dictate trends. And they are less guarded than past generations about making big decisions remotely.
Hopefully, this article sheds light on an unusual real estate trend. As real estate technology continues to grow and millennials exert influence, you can expect sight-unseen sales to continue.