We buy houses. Who is actually buying when you see that sign.
Get a real cash offer from a buyer who will actually close. See the number online, see how it was calculated, and connect with a vetted local buyer when you're ready. Before you sign with anyone, know what kind of buyer you're dealing with.
"We buy houses" is not a company, it is a category, and behind those signs and billboards are four or five different kinds of buyers with different business models and different reasons to want your house. Here is how each one works. No company names, no pitch.
Who is actually on the other side.
1. The flipper
A flipper buys a house that needs work, fixes it, and sells it within about six to twelve months. Their whole model depends on buying low enough that, after repairs, holding costs, and selling costs, there is still a margin left.
How they price. They estimate the after-repair value (what the house will sell for once it is fixed up). They subtract the cost of the work. They subtract their carrying costs (taxes, insurance, utilities, interest on their money) for the months they will own it. They subtract their selling costs (agent commission, title, closing costs) on the other end. Whatever is left, minus the profit they need to make the deal worth doing, is their offer.
That is the "70-percent rule" in most flipper conversations: offer 70 percent of after-repair value minus repair costs. In a softer market with higher rates, that number drops closer to 65 percent. In a hot market with cheap money, it creeps toward 75 or 80. The logic behind the rule is documented in academic work on investor home purchases[1].
What they want. A house that needs cosmetic work or moderate systems work (roof, HVAC, plumbing), in a neighborhood where retail buyers pay real money after it is fixed. They do not want tear-downs (too expensive) or perfect houses (no margin).
Who they are. Usually local. An LLC with one or two owners, maybe a crew of contractors they use over and over. Some are institutional and do 50 flips a year. Most are smaller.
When they are your best buyer. Your house needs work, you do not want to do the work, and you want to sell once. They price the work into the offer so you do not have to.
2. The buy-and-hold landlord
Also called BAH or rental investor. They buy a house, fix what has to be fixed, rent it out, and hold it for years or decades. They are not flipping. They are building a rental portfolio.
How they price. They work backward from the rent the house will produce. A common metric is the 1 percent rule: monthly rent should equal about 1 percent of the purchase price. If a house will rent for $1,800 a month, the landlord wants to pay around $180,000, adjusted for local taxes, expected repairs, and vacancy. In dense urban cores, that rule is harder to hit than in lower-cost markets, so landlords use cash-on-cash return or capitalization rate (cap rate) calculations instead.
What they want. A rentable house in a rentable neighborhood. They care less about cosmetic condition than a flipper does, but they care about the bones (roof, foundation, systems, plumbing, electrical). They do not want a full gut rehab because the money they spend on renovation does not come back as rent.
Who they are. Local landlords building five- or ten- or fifty-house portfolios. A few are large institutions. ATTOM tracks the institutional share of home purchases in their quarterly reports[2]. In some metros, the institutional share has historically run below the national average, which means most landlords you deal with are local.
When they are your best buyer. Your house is in rentable condition, in a rentable location, and you want a quiet cash sale without the full flip discount. A BAH buyer often pays a few percent more than a flipper because they are holding, not reselling, so they do not need the same margin.
3. The wholesaler
This is the archetype that causes the most confusion. A wholesaler does not buy your house. They get it under contract from you, then sell that contract to an end buyer (usually a flipper or a landlord) for a markup, typically $5,000 to $20,000.
How they price. They offer you the lowest number they think you will accept, because their profit is the spread between your price and what a real investor will pay. They are running a middleman business. They are not wrong to do it. It is a legal activity when done within state rules. But the person at your kitchen table is not the buyer.
What state law says. Most states treat repeat wholesaling activity as real estate brokerage under their state real-estate license act[3]. Unlicensed individuals can generally only wholesale a small number of deals per year before they cross the line into licensed brokerage activity. The threshold and exact rules vary by state[4]. This matters because a wholesaler who is over that limit and unlicensed is operating in a gray zone, and if your deal falls apart, the remedies are harder to sort out.
Red flags that you are dealing with a wholesaler.
- The contract says the buyer is "X LLC and/or assigns." The "and/or assigns" clause means they are planning to assign the contract to someone else.
- They ask for a long inspection or due-diligence period (14 to 30 days). They are using that time to shop the contract.
- They cannot name the end buyer. A real cash buyer knows who is cutting the check.
- They try to keep a low earnest-money deposit ($500 or $1,000). They do not want to risk much of their own money because they are not planning to close themselves.
When a wholesaler is acceptable. If they disclose upfront that they are a wholesaler, the assignment fee is reasonable, the end buyer closes on the contracted terms, and you get your proceeds on time. Some wholesalers operate cleanly. But you should know that is what is happening before you sign.
4. The iBuyer
iBuyer is short for "instant buyer." An iBuyer is an algorithm-driven buying service like Opendoor or Offerpad. You enter your address, the algorithm pulls local comps, and you get an offer in 24 to 48 hours.
How they price. Algorithmically, using recent sales of similar homes nearby. The offer is usually closer to retail than a flipper's because an iBuyer does not plan to do heavy renovation (they list the house back on the market with light touch-ups). The catch is the service fee. iBuyers charge a service fee, typically 5 to 8 percent of the purchase price, plus they run their own inspection and ask for repair credits. After fees and credits, the net to the seller is often close to what a traditional cash buyer would pay.
Academic work on iBuyer pricing finds the combined effect of service fee plus offer spread is a meaningful discount to fair market value, with variation across markets and home segments [1]. Redfin's periodic iBuyer reports track share and pricing in metros where iBuyers operate [5].
What they want. A house that fits their algorithm's box: built after a certain year (usually 1960 or 1970, varies), no unusual layout, no obvious condition issues, in a suburb where their data is good. They do not buy tear-downs, rural properties, or houses outside their operating footprint.
Who they are. Corporate, national, venture-backed. Opendoor is the largest. Offerpad is the other current active iBuyer at scale. Several have entered and exited the market since 2018. iBuyer coverage in any given metro has been uneven and can change without notice.
When they are your best buyer. Your house is in clean shape, fits their box, you value the instant-offer convenience, and you are okay with the service fee math. The comparison to a traditional cash buyer usually comes out close.
5. The retail cash buyer
The rarest archetype, but real. This is a person (or a couple) who wants to live in the house and happens to be paying cash. No lender, no flip, no rental.
How they price. Like any retail buyer. They are competing against other buyers on the MLS, so they often pay near market. Their "cash" is a financing advantage, not a discount lever. They use cash to beat financed offers in a competitive market, not to pay less than market.
Who they are. Downsizers using proceeds from a bigger house. Investors buying their own home. Relatives of the seller. Out-of-town buyers with liquid savings.
When they are your best buyer. You are selling a house that a retail family would want, in a market where cash buyers show up. A seller looking at this archetype is running an MLS sale, not an off-market cash sale, and the math is completely different.
How to tell which archetype is making you an offer.
Five questions will usually get you the answer.
- "Are you the end buyer, or will you assign the contract?" A flipper says end buyer. A BAH landlord says end buyer. A wholesaler says something like "we sometimes assign" or "our partners close." An iBuyer says end buyer. A retail cash buyer says end buyer.
- "Where is your proof of funds from, and how recent?" A real end buyer has a bank statement or a bank letter dated within 30 days. A wholesaler usually has a letter from someone else's account, or something vague.
- "How long do you need for inspection or due diligence?" A flipper or BAH wants 3 to 7 days. An iBuyer wants 7 to 10. A wholesaler wants 14 to 30. Long due diligence is a wholesaler signal.
- "What is your earnest money deposit?" A real buyer puts $5,000 to $10,000 into escrow at the title company. A wholesaler often offers $500 or $1,000. Low deposit means low skin in the game.
- "What is your plan for this house?" A flipper says renovate and resell. A BAH landlord says rent it out. A wholesaler says they will line up a buyer. An iBuyer says relist with light updates. A retail buyer says move in.
If the answers do not match any of the archetypes, ask again. Clarity is a reasonable thing to want before you sign anything.
What the signs and billboards actually mean.
- "We Buy Houses Cash" is almost always a flipper, a wholesaler, or a small buy-and-hold investor. The sign does not tell you which. Ask.
- "We Buy Ugly Houses" is a national franchise brand (HomeVestors is the best-known). The local franchisee is usually a flipper or a small landlord operating under the brand.
- "Sell Your House in 7 Days" is a marketing promise. The actual buyer could be any of the archetypes. The 7-day timeline is achievable for a real cash buyer; it is aspirational for a wholesaler who still needs to find an end buyer.
- "Cash Offer in 24 Hours" is about the offer, not the close. Any of the archetypes can produce an offer in 24 hours. The close takes longer.
- "No Fees, No Commissions" is true in a direct sale, for any archetype. You still pay your own closing costs (title, transfer stamps, attorney fees) unless the contract specifies otherwise.
The sign is a marketing layer on top of one of the archetypes above. The archetype is the thing that actually determines what kind of deal you are getting.
What stays true for all of them.
Whatever archetype is on the other side, two things are always true.
You still have a seller's disclosure duty. Nearly every state has a residential real-property disclosure statute[6] that requires sellers to disclose known material defects. "As-is" protects the buyer from expecting repairs. It does not let the seller hide things. Pull your state's seller-disclosure form before you sign anything.
The price will be below an MLS retail price. That is the whole point of selling off-market. A flipper pays less than retail because they need margin for repairs and profit. A BAH landlord pays less because they are pricing to rent yield. An iBuyer pays less after fees because the service fee is how they make money. A wholesaler pays less because two people need to get paid from your spread.
A cash offer that is not below retail is almost always either a retail cash buyer (rare) or an offer that is going to be re-traded once the inspection runs (common). Know the difference going in.
The honest summary.
"We buy houses" is a category, not a company. The archetype behind the sign determines how you will be priced, how the deal will actually close, and who you are really negotiating with. Five buyer types cover almost every case: flipper, buy-and-hold landlord, wholesaler, iBuyer, and retail cash buyer. A few questions at the kitchen table will tell you which one is sitting across from you.
Once you know that, the offer makes sense. And once the offer makes sense, you can decide whether to take it.
See your cash offer.
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