How To Buy a House Online

More homebuyers are ready to shop online for that cottage or craftsman, and many are even willing to buy online.

In fact, 97% of all homebuyers said they’d used the internet in their home search, according to a 2021 study from the National Association of Realtors (NAR). Most buyers typically viewed nine homes over eight weeks, with five homes viewed solely online—and most buyers find their eventual forever home online.

"The outbreak of the pandemic and an extremely hot, fast-moving real estate market that followed has raised the demand for more aspects of the house hunting and buying experience to take place from the comfort of our own homes," said Amanda Pendleton, Zillow’s home trends expert, by email to The Balance. A 2020 Zillow survey found that 36% of Americans would be more likely to buy a home entirely online at that point in time (during the COVID-19 crisis).

But not everyone is bullish on the idea of buying a home 100% online. "You could, but I don't think you should," said Jen Nelson, a Phoenix-based real estate agent who frequently helps people buy homes online. "There are a lot of little things you don't realize or notice you want in a property until you see it.”

For that reason, it’s more accurate to consider the online homebuying process as a hybrid experience. While you can’t text, click, and email your home purchase from start to finish, you can do a lot online. Your real-estate agent and inspector will do a little legwork, and phone calls or Zoom meetings will happen.

Pros and Cons of Buying a House Online

Pros Explained

• Saves money: Buying online saves money, particularly in hot markets away from home. "You're not having to fly out to look at houses," said Seattle-based agent Matthew Chapman. Buying last-minute tickets or flying out every weekend can add up. Agents can send you home disclosures, set up inspection discussions, and more from afar.
• Saves time: Technology has made long-distance shopping more efficient, with video tours, secure file transfer, and digital signings. “I work with people from around the world,” said Chapman. “You can sign for a new home in Hong Kong or Dubai, and we aren't beholden to time zones."
• Internet-savvy buyers can benefit from in-depth research: Clients must perform some research independently, Chapman said, including reading up on local schools, community events, and neighborhoods. Chapman asks clients to use Google Street View to check out the neighborhood.

Cons Explained

• Can be stressful: Buying a home online—for hundreds of thousands or millions of dollars—isn't like clicking through for cheap socks on Amazon. "In any real estate transaction, the emotional component and stress involved in a home purchase are high,” Chapman said. People can feel overwhelmed or make an uninformed decision and regret it.
• May not be suitable for first-time homebuyers: Second-home buyers and those who've been through the process before may have more real estate savvy, resources, and finances, while not being as emotionally invested, Nelson said. First-time homebuyers might choose instead an in-person approach.
• Online listings may not be up-to-date: Some home-search apps may not have real-time accuracy for listings, Nelson said. “For instance, in Arizona, some MLS statuses don’t filter out to third-party sites like Zillow, Redfin, and Trulia. For example, ​’UCB’ which stands for ‘under contract, taking backup offers.’” The homes may still look available, but really aren’t. You may need to rely on a local real estate agent to navigate the market so you don’t miss out.

Best Places To Shop for a House Online

Today, most buyers kick off their home search online, said Fiona Dogan via an email to The Balance. Dogan has worked with luxury property buyers across the U.S. and worldwide as a Realtor in Rye, New York. Research backs Dogan up—the typical first step in the homebuying process is looking online for properties for sale, according to a 2021 NAR survey.

Online home listings often offer photos, information on the house’s physical characteristics and sales history, and 3D tours. Here are a few places to start your home shopping trip:

Local Agent

Chapman has worked with two San Francisco clients who purchased Seattle-area homes online. "I sit down on a Zoom call with clients before they start looking, to create a custom-tailored game plan and strategy," Chapman said. "The best clients for the online home hunt are those who are confident and excited about the prospect, not terrified. Someone who loves the unknown and convenience of buying online and has calculated out the whole risk-reward scenario." Then, Chapman sends potential abodes to consider by email and text.

Realtor.com

This real estate website lets you share and save homes, and add ratings and comments in a private dashboard. Realtor.com 3D offers home tours and a noise indicator to detect traffic, plane, and school noise pollution. The Sign Snap feature allows users (or their friends in another city) to scan for-sale signs and immediately pull up the Realtor.com listing.

Redfin.com

Redfin's easy-to-use shopping app shows homes, condos, and land photos and details. Newer service Redfin Direct allows buyers to buy a home online from Redfin agents in 12 markets, many in California. The Redfin Direct tool helps develop an offer, which may stand out to the home seller as it removes fees typically paid to the buyer's agent. However, you're also on your own when it comes to negotiating a deal.

Zillow.com

Some early adopters may be comfortable with Zillow’s online residential-purchase transaction process. Users can search and browse for-sale listings with others on FaceTime, in conjunction with SharePlay. Buyers can finance directly with Zillow Home Loans or use Zillow’s online mortgage marketplace, and use Zillow Closing Services to wrap up the deal. The company's mobile notary service means the process isn't entirely online, but you don’t have to leave your sofa.

New Construction 

Some new-build companies offer tools and resources to make shopping online easier. For example, Meritage Homes builds homes in nine states, in cities such as Denver, Phoenix, and Atlanta. Meritage buyers can work with a sales counselor to tour homes virtually, schedule remote appointments, personalize their homes with virtual design appointments, and track the build's progress. Buyers can also get preapproved for a mortgage, and purchase with digital tools, complete the closing virtually, and attend an online new-home orientation.

How To Buy a Home Online

Get a Mortgage

Applying for a mortgage online isn’t unusual—you can now scan or upload images and documents such as your tax returns or paystubs. Since 2006, Dan Green has run mortgage companies without physical branch offices. Pre-pandemic, Green’s business model was more unusual.

"The pandemic showed consumers that business can be conducted at any time through any medium, and 9-to-5 hours are a relic," said Green via an email to The Balance. "Everything in life is on-demand, and financial services don't get a pass." Green conducts some mortgage business for Homebuyer.com by email and phone.

Mortgage broker Steve Hill of SBC Lending has worked primarily online since 2012, using a combination of email, text, and phone calls with clients. "Everyone prefers communicating in a slightly different way, and it's important to meet clients where they are," Hill said via email.

However, Hill pointed out that buying a home is usually the most significant financial purchase most people make, and sometimes requires months of preparation to get credit, income, and finances in order.

"Buying a home and the mortgage process is fairly complicated, and it takes time to explain, so calls are usually best," Hill said. "For a conventional loan, the guidelines are 1,200-plus pages long, without taking into account appraisal guidelines, escrow requirements, title insurance, and contract law. A lot can get missed if all you do is a few short questions over email."

Assess Homes and Put in Offers

Agents like Chapman in Seattle may take online clients on virtual home and neighborhood tours using a camera. A professional camera attachment and app stabilize images and allow him to pan slowly through a room or down a street. When Chapman pulls up to a house, he also uses his camera to show the real-time situation. At least one client said “no” to a home next to a residence that seemed to collect cars, trash, and spare parts.

Chapman points out issues that might not necessarily show up on glossy home photos or 3D tours. "I'll show the hardwood floors close-up and ask if they're OK with the scratched floors. I don't want someone to be surprised when they get into the house." Chapman also notes when the camera lens distorts, making a room appear larger or smaller or unable to truly capture the amount of natural light.

Even as online home searches, tours, and closings increase, "buyers and sellers are still human, with all of the accompanying emotions," Dogan said. "There’s little substitute for touring and feeling the personality of a house and neighborhood in person." In Dogan’s experience, most residential shoppers either visit the home or send family and friends to enter the space.

Inspect the Home

John Wessling, 2022 president of the American Society of Home Inspectors (ASHI), noted via email that home inspections still require a hands-on approach—testing outlets, examining the attic and crawlspace, and checking the operations of plumbing systems and electrical panels. "The home visit and inspection should be done by an experienced, educated, certified, and licensed home inspector who physically inspects the property," Wessling said.

During or after inspection, the inspector can meet with the homebuyer online. Wessling has done so in the past. "Using media can be complex due to the bandwidth required, camera angles, and poor lighting," he said. "However, it was productive overall as I observed and discussed issues with my client in real-time." Inspectors also provide a written report after completing the inspection.

Inspection periods can vary state by state and by housing market. In Arizona, Jen Nelson’s clients often put an offer on a house, then fly out to see it in person during their due diligence period. They then have the opportunity to see the home while they can still walk away from the purchase should it not meet their expectations. “It’s hard to convey depth and volume via video tours, so we strongly encourage clients to see it in person whenever possible,” Nelson said via an email to The Balance. 

Close on the Home

Remote online notarization is legal in most U.S. states, so buyers and sellers can sign documentation online.

For example, direct residential lender Silverton Mortgage is licensed in 46 states and offers an online application process. In November 2021, the company began offering an online application process for homebuyers, along with hybrid e-closings. With a hybrid e-closing, borrowers digitally sign about 80% of their paperwork using a popular digital closing platform called Snapdocs. Buyers, agents, and closing agents then show up to sign the final paperwork in person, cutting the closing time to about 15 minutes.

For everyone involved, the real test of online shopping comes when the buyer walks into the house for the first time, after the home closes. "I don’t want my clients to be disappointed or let down, in regards to the home," Chapman said. “But clients commented to me after meeting their new home, 'we like it even better than we thought, and couldn't be happier.' "

Frequently Asked Questions (FAQs)

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