HomeVestors franchises are one of the only outfits left still running cash-for-houses operations amid the pandemic.

The weekly grocery run feels like a high-risk gamble, encouraging cheery ruminations on one’s mortality, while the economy suddenly looks like Great Depression 2.0, with deserted streets, empty offices and shuttered storefronts and restaurants. 

Food pantries, hospital wards, and Dunkin’ drive-thru windows are pretty much the only places that are bustling right now. 

So, I was heartened to learn that HomeVestors – a.k.a. the “We Buy Ugly Houses” gang – is at least one business that isn’t packing it in. 

Even as Zillow, Redfin and Opendoor recently put their cash-for-home ventures on ice, HomeVestors recently announced it will keep making cash offers for homes in the Boston area, coronavirus be damned. 

And in the spirit of the times, HomeVestors announced it would be offering virtual consultations to homeowners, relying on photos and video tours to determine whether to make an offer.   

“The decision to go virtual comes after Gov. Charlie Baker issued a statewide stay-at-home advisory,” local HomeVestors franchise We Buy Ugly Houses Boston recently announced. 

The virtual consultations will “ease seller worries during this unprecedented time,” the franchise noted in its press release. 

How considerate.  

In fact, I received a hand-written note – nice touch! – from a HomeVestors franchise owner just as few days ago. 

Not only did “Chris” offer to look over my century-old Natick fixer-upper – virtually, of course – for a potential cash offer, but he made clear he was interested in looking at all the other homes in my neighborhood as well, so spread the word (socially distancing while you do it). 

Now that’s a way to make a guy feel special! 

Not My First Rodeo 

Of course, I haven’t broken it to my new friend at HomeVestors, but it’s not the first time the cash-offer home flipping operation has taken an interest in my neighborhood near downtown Natick. 

Marion Street features a mix of older homes renovated over the past decades or two with some fairly pricey new duplexes – selling for well more than $800,000 each – built after teardowns of older homes.  

There are also a couple run–down homes that have been all but abandoned for a couple years, along with a battered cape next door that is anything but unoccupied, with a neighbor running what amounts to an auto-repair business on his paved-over lawn. 

So, I was not exactly shocked when one morning about a decade ago, I walked out my door to pick up the paper and there, stapled to the telephone pole was HomeVestors’ signature “We Buy Ugly Houses” sign.  

It was in the midst of some tough times, with home prices and the economy having stalled out in the wake of the Great Recession. 

We probably also received a letter a well – at this point, I don’t recall all the details 

But I do remember feeling pretty damn angry and walking over, ripping down the sign and throwing onto a pile of junk in my garage. 

Why the reaction? Well, looking back, I probably felt more vulnerable than I realized. 

Money was tight, our mortgage was bigger and our financial situation could have been better, to put it nicely. 

HomeVestors Greater Boston franchises paid an average of $250,000 per home they bought last year, less than half the local median price for a single-family home.

The last recession had cost my wife her job at a major bank, just as I struck out on my own as a freelancer after years at the Boston Herald and other newspapers. 

And we had just completed a major renovation and addition to our cramped village colonial. 

Built in 1924, had been a complete wreck inside when we bought it, from knob–and–tube wiring, dingy wallpaper and moldy carpeting, to a grimy toilet in danger of falling through the rotting floorboards to the dirt-floor cellar underneath. 

Solving Problems, For a Price 

OK, to be real, you would have had to put a gun to my head to sell my home at a loss to HomeVestors or anyone else.  

But looking back, what if we had been desperate enough for the cash? What’s clear now is that it would have been the worst financial decision of our lives. 

Today our house is worth, at least according to Zillow’s zestimate, more than $714,000. That’s a nearly 60 percent increase over a decade ago. 

But it also made me wonder about 100,000 people who, according to HomeVestors, sold what was likely their most valuable asset to the home-flipping franchise over the past quarter–century. 

So, I called David Hicks, CEO of Dallas-based HomeVestors. 

Hicks contend that his business is not about driving hard bargains and flipping homes but rather helping people out of “ugly situations.” The homes his franchise owners buy are typically run–down and in need of extensive work before they can be put on the market. 

“These are homes that Realtors don’t like to sell,” Hicks said. “They smell like cats – they are not marketable.” 

And Hicks said his franchise owners work with sellers, “educating them on what their options are. We really try do to the right thing for them.” 

Overall, HomeVestors’ 20 franchise owners bought a total of 200 homes last year in the Boston area, for a total of $50 million, or $250,000 each. That’s less than half the median price for a single-family home. 

And for this part, Hicks sees no issue continuing to pursue sellers ready to turn their homes over for a quick cash payment amid the coronavirus, arguing he is providing an important service. 

Scott Van Voorhis

“The reality is people need to move,” Hicks said. “We help them. We tell them their options.” 

So, with the housing stock in my Natick neighborhood a mix of the good, the bad, and the downright ugly, I can see why some eager HomeVestors franchise owner might see an opportunity to snag something cheap, fix it up and flip it. 

But that doesn’t mean I am thrilled with a business that clearly stands to profit from other people’s hard times, and, to top it all off, acts like it is doing everyone a favor by trolling for new business amid a deadly epidemic.   

Scott Van Voorhis is Banker & Tradesman’s columnist; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.