On Tuesday, Opendoor announced it had acquired Open Listings, a discount brokerage that gives homebuyers a 50-percent deduction on commissions.
The move, which instantly provides the San Francisco-based startup with a new team of salaried real estate agents and a cache of emerging technology, is being watched closely by other iBuyers, many of which weighed in on the news. Knock and Offerpad responded with broad encouragement while Felix Homes, a Nashville-based startup that offers a prearranged price before trying to sell homes for higher, commented on the acquisition more directly.
Zillow Group, which earlier this year joined the iBuyer fold with the launch of its own online homebuying and selling service, did not reply when Inman reached out earlier this week for a comment on the Open Listings acquisition.
“The acquisition makes sense because, in markets where Opendoor’s not currently in, it gives them a channel to expand,” said Tyler Forte, the founder of Felix Homes, adding that his company has previously engaged with Opendoor about a potential homebuying vertical. “On the other side, Opendoor has been offering sellers a value proposition for years so it’s only natural that they expand their product offering to include buyers as well.”
Opendoor, which launched in San Francisco four years ago, was one of the first companies to offer an iBuyer business model, with Offerpad and Knock following suit a year later. Since that time, the trio has battled for market share in metro areas including Las Vegas, Phoenix and Atlanta, among others, while frequently introducing new services in a bid to distinguish themselves.
On Tuesday, following the news of the Open Listings acquisition, Offerpad CEO Brian Bair hinted that his Arizona-based company was nearing an announcement of its own, although he did not elaborate.
“Less than four years ago, homebuyers and sellers didn’t have nearly the options they do now to search, view, sell and purchase homes,” Bair told Inman in an email earlier this week. “Offerpad is proud to be a leader in the evolving real estate industry; you can expect to see continued revolutionizing developments in this space in the coming weeks and months.”
Knock, which purchases the customer’s new home on their behalf before selling their old house on the open market, praised the acquisition, suggesting that all innovation in the iBuyer space is beneficial to the bottom line. CEO Sean Black said that Knock’s model owns it own subset of the market — in particular, people who want the convenience of an iBuyer but can’t afford to lose money on service fees.
“We are excited by the continued innovation in our space and the increased options for consumers to have more certainty and transparency around the biggest transaction of their lives,” Black told Inman in an email.
“We have an incredible consumer value proposition in our unique Home Trade-in model, and are happy to have that compared to other new ways of buying and selling your home, as we almost always win the customer’s heart and mind in those comparisons.”