This report is available exclusively to subscribers of Inman Intel, a data and research arm of Inman offering deep insights and market intelligence on the business of residential real estate and proptech. Subscribe today.
Zavvie is getting into the power buyer game.
The company offers a web app to help agents communicate selling and buying options to clients in a marketplace format and now provides brokerages with cash-offer services.
The white-labeling program, called simply zavvie Power Buyer, was announced exclusively to Inman and will include two common forms of the power buyer model, contingency-free (cash offer) financing and a buy-before-you-sell bridge loan.
“When brokerages use zavvie Power Buyer, they are seeing between a 10 percent and 15 percent increase in their mortgage capture business because we connect clients directly to the brokerage’s preferred lender,” said zavvie CEO Lane Hornung.
Zavvie has made the financing products available to 14 current brokerage customers in 11 states and the District of Columbia. Some of those include The Keyes Company in Florida, Home Pros in Texas, RE/MAX Professionals in Colorado, and Berkshire Hathaway HomeServices Stouffer & Preferred in Pennsylvania among others, according to the announcement.
Zavvie’s core competency rests on presentation software that ranks the array of options homebuyers and sellers have available to them today, ranging from traditional open market transactions to lists of fast-moving iBuyers and institutional investors. Agent-first zavvie Pro was launched in 2020, empowering them to create detailed breakdowns of each offer type and visualize final net proceeds.
Windermere, for example, hired zavvie in 2022 to build out their branded comparison tool, calling it Windermere Offers. The tool will also help sellers compare mortgage options and other paths to homeownership, such as rent-to-own.
A large part of zavvie Power Buyer is to help brokers capture additional mortgage business, making the deal vertical as opposed to spreading wide among multiple vendors. Hornung said his company wants to avoid owning homes, as many power buyers end up doing, which depletes revenue from brokerages with mortgage arms.
“The zavvie platform continues to showcase all the other leading power buyers solutions, as our program is designed to be complimentary, not competitive,“ Hornung said.
The term “power buyer“ originates from the advantage offers submitted without financing contingencies provided to consumers. The buy-before-you-sell model was largely made popular by Knock’s Home Swap, which allowed sellers to make offers without “contingent upon sale” clauses. Knock went on to launch cash-offer services too.
Inman reported that zavvie raised $3.65 million at the start of 2023, led by the National Association of Realtors’ Second Century Ventures.
Hornung remains bullish on what alternative financing structures can provide consumers who seek less-complicated, streamlined home transactions. Data shows that they’re willing to pay for it too.
“We believe 2023 will be a breakout year for power buying because cash offers will particularly help first-time buyers,” Hornung said upon closing the funding January round.
At Inman Connect New York last month, 1000Watt CEO Brian Boero revealed survey results from 1000 millennials that demonstrated little interest in how much agents made or how they made it. They merely want it to be easier to move.
Fifty percent of 1000watt’s survey respondents said they would take a cash offer for less money if it came with a quick process and the dependability of closing on time. What people want, Boero said, is less stress during the transaction, not pitches about commission costs.
Zavvie’s research backs Boero’s.
“Mortgage-backed buyers needed to make an average of seven offers when buying a home, but just 1.1 offers when using a cash offers program,” the company said.
Zavvie states it directly serves more than 75,000 agents and up to 400,000 through its many integrations.
