Editor's Note: This story has been edited to reflect Knock estimates the value of homes using proprietary algorithms combined with real life evaluations from licensed local agents.
There's no question about it---if there's one thing Atlanta knows, it's real estate. But with technology platforms like Zillow and Trulia, the game of buying and selling a home is quicker, easier and more convenient than ever.
Sean Black, a founding team member of Trulia, is behind the latest in home buying tech in Atlanta---Knock, one of the first-ever home trade-in platforms.
"We are basically trying to make it as easy to trade in your house as it is to trade in your car," he said.
With Knock, homebuyers and sellers solve three crucial problems presented with trading in their home, according to Black, CEO and co-founder of the company: liquidity, convenience and underwriting a mortgage.
On average, Knock customers have 30 percent equity in their home, making the process of trading to a larger, more expensive home a difficult task, Black said.
"They need that money unlocked in order to move up into a bigger house, usually in a better school district or neighborhood," he said. "And that’s a conundrum because you have to decide if you sell your house first and move into your in-laws, an apartment or be homeless or you buy first and hope to god your home sells in time."
Knock says it also has a solution to the age-old problem of having to mobilize children and pets every time a prospective homebuyer wants to see it.
"It’s really hard to show your house for months on ends," he said.
Once a home owner signs up with Knock online, the company estimates the value of their home using proprietary algorithms combined with real life evaluations from licensed local agents, provides mortgage underwriting, goes shopping for a new home with the owner and buys the house they select for an all-cash offer, Black said. When the customer moves into their new home, Knock will invest up to $10,000 worth of upgrades and features (all approved by the home owner) and sell the home. This cuts down the waiting process of buying a new home and selling their old one, he said.
"On average we sell houses within 15 to 25 days and it’s a matter of waiting for the buyers’ financing to clear," he said. "Soon as that happens, we close on your old house, you apply whatever you want to the equity of your new house and execute the mortgage and you’re done."
Though headquartered in New York, Atlanta is one of Knock's first markets and it has been buying and selling homes for Georgia residents for more than two years, Black said. The company is now offering options for first time home buyers---the latest feature added---and those looking to simply sell their home, usually consolidating for a marriage or other family situation.
"Something like two thirds of the customers in Atlanta are trading houses," he said. "We have another third that is consolidating."
Knock charges the same fee a traditional broker would charge, Black said, about 3 percent, and hires local agents who know the area to help home buyers find their next residence. Black said about 20 percent of the homes he's working with in Atlanta came from referrals.
"So that’s friends, neighbors, coworkers, coming to us purely word of mouth, which is amazing, because it traditionally takes an agent 10 or plus years to get to that,” he said.
