It should’ve been a banner year for Flyhomes.
As 2019 drew to a close, the real estate startup had $141 million in fresh funding to fuel the expansion of its novel home-buying service beyond Seattle to Portland, Boston, and Los Angeles. Then, three weeks after announcing the expansion, the first-known U.S. coronavirus case was discovered in Flyhomes’ backyard.
The U.S. real estate market froze as the full scope of the coronavirus crisis came into focus, a nerve-wracking jolt for Flyhomes, which was sitting on several homes the startup purchased on behalf of clients.
Flyhomes buys houses directly with cash and then holds onto them until its buyer clients secure financing. The goal is to present its customers as the equivalent of cash buyers, helping them gain an edge in competitive markets.
Despite the uncertainty that marred the initial weeks of the pandemic, Flyhomes managed to close deals on all of the homes it purchased. Since then, the Seattle real estate market has stabilized for the most part, according to Flyhomes CEO Tushar Garg.
“What we’re seeing right now is a high demand in the buying market, less inventory, and we’re not anticipating that to change anytime soon,” Garg said.
We caught up with Garg to hear his perspective on leadership, the real estate market, and more as part of a special GeekWire Podcast series highlighting finalists for the upcoming GeekWire Awards, a live virtual event at 4 p.m. on Thursday, July 23. Garg is one of five finalists for Startup CEO of the Year.
Listen above and read edited highlights from the conversation below.
On the real estate market: “The real estate market did go on a pause as soon as COVID hit just because you couldn’t show the house safely, you couldn’t buy the house safely, and it wasn’t an essential service. But then soon after, real estate became an essential service and the company and the industry adapted to showing the houses in a safe way. We found that everything else can be done online. What’s been really fascinating is that in the short run, the market did slow down and the inventory was much lower, and the inventory is actually starting to catch back up in all the markets right now.”
“But in the long run, to a large extent, the idea of having a house has become further accentuated in this situation, where a lot of people who have started to work from home and are looking for more space. Traditionally, in the U.S., the housing market has had a great shortage of stock. The housing inventory is far less than the number of buyers and that’s why we’ve seen competitive markets across the U.S. for a long time. With COVID hitting [and] the inventory drop, the number of buyers actually remained the same. So what we’re seeing right now is a high demand in the buying market, less inventory, and we’re not anticipating that to change anytime soon.”
On leadership: “It’s the story of resilience and dealing with crisis and how do you navigate and come out the other side? In those moments when things look dark, I think you have to appreciate it as an opportunity to create and be innovative. And normally something good comes out of it. Every crisis is an opportunity to innovate and become better for the future. It’s really hard to see that while you’re living through the crisis.”
On the pandemic’s long-term impact: “Work from home, I think, it’s definitely going to become a big trend and that will have its own implications on where people live. Now it’s hard to know. There are so many things that also hold us to where we are, so not everything changes. Schools being one big factor, where a lot of the families have schools, communities, families, and friends, nobody can predict exactly how it’s gonna happen. Of course, you see the reports on all dimensions where people are moving, and we see that in the customer base as well, where many customers are looking to move to further out areas, even in the Seattle area.”
“But then there are many folks who are just worried about the uncertainty in the economy at the moment and holding out [on] buying a home. My feeling on this is just like most things, there will be change, and it will get accelerated. Work from home or becoming remote-first will become more of a trend, and its implications for the housing markets are going to be interesting, but also there’s a lot of factors that hold us to our homes and the places we live. So I don’t anticipate it to change super dramatically in that direction.”