Opendoor is a venture-capital-financed property flipper with a $1 billion valuation. Inman had a fantastic piece last week by Mike DelPrete analyzing Opendoor’s progress in its first two years. Read it. Quick observations based on Mike’s piece: Opendoor buys and resells homes. Sometimes it fixes them up a bit, but its average relisting time is just 20 days. More than half the time, the gap between the price Opendoor pays sellers and its resale price on the flip is 5.4 percent or greater. On about 1 out of 5 resales, Opendoor pockets price gains of 10 percent or higher. Consumers are also charged 6 to 12 percent in fees, averaging between 8 and 9 percent. To Opendoor’s credit: There is a need in some specialized cases to turn real estate into a liquid asset in short order. Even if the assets are heavily discounted in the process, there’s a niche audience that requires this service. Opendoor’s founders are brilliant in creating and selling this mark...
- According to research, median Opendoor homesellers give up 14 percent of their homes' value through equity and fees.
- The results for homeowners are like a payday loan: Some scenarios could push seller loss percentages into the 20s.
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