Will I need to refund this eBay transaction?

I sold an iphone 5 a couple weeks back on eBay, I did let them know that I was on holiday and will send off when I was back and they said that would be fine. So I sent it off when I got back, but the buyer has now opened a case saying when it gets there they want to refund it. When I did say in the auction no returns, will I have to refund them?

They have to ship it back in the same condition and pay for return shipping in this case before you issue a refund. Yes, it is wiser to refund them than to risk getting negative feedback (even if unjustified). You never know about wacko buyers. I don't see how buyer can open a case for refund before they receive item. Did Ebay actually open a dispute or did the buyer just email you directly?

Why do they want a refund? There must a be reason

No
(and your "no refunds" in the auction is completely irrelevant)

The buyer has clearly stated that they want a refund before they have even got it - so they would have a hard time claiming anything about it being "not as described" or not working after they receive it
(in either of these cases they have a legal right to a refund no matter what you put in auction)

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