Originating in 2015, Opendoor promised to simplify the home selling process by giving sellers an all-cash offer for their home within 24 hours. One of the pioneers of the real estate iBuyer model, Opendoor guarantees to help home-sellers “skip the hassle of listing, showings, and months of uncertainty.” However, this convenience comes at a cost with Opendoor’s take-it-or-leave-it offers often being close to, but ultimately below fair market value.
So is selling with Opendoor worth the trade off? Let’s start by defining exactly how Opendoor works, and then walk through the pros and cons of using Opendoor to sell your home. Finally, we’ll look at some Opendoor reviews from previous customers.
How Does OpenDoor Work?
Opendoor is one of the pioneering companies of the iBuyer model. In essence, Opendoor functions like a venture capital backed, national real estate investor. They purchase homes directly from sellers who solicit offers through their website Opendoor.com.
Through this process, Opendoor will collect information about the home such as square, footage, beds, baths, level of finishes, upgrades and finally they will ask for pictures to be uploaded. Within 24 to 48 hours Opendoor will either notify the seller that their home doesn’t qualify for an offer, or they will present their purchase offer. At that point, it’s up to the seller to either reject the offer or move forward in the process.
If the seller accepts the offer, an Opendoor representative will conduct a site visit and inspection. At that point, Opendoor will determine if they plan to move forward with the sale as-is, attempt to negotiate as a result of the condition, or decide to terminate the contract.
What Homes Don’t Qualify for an Offer from Opendoor:
- Property Types
- Single family homes (traditional houses)
- *Opendoor will not purchase mobile homes or pre-fabricated homes
- The typical price range they purchase in is $100K-$600K but will go as high as $1.4M
- They typically buy homes on lots less than an acre but on occasion will purchase property on lots that max out at 2 acres
- Year built must be after 1930 in most cases
- Opendoor will purchase homes with solar panels if there are no existing leases or outstanding balances on the panels
Pros and Cons of selling to Opendoor:
- Opendoor moves fast, they are able to close quickly since they are purchasing the property cash. Opendoor can also offer a flexible closing date if you need time to move
- The process for selling seems to be relatively smooth when everything works out. Opendoor does not require any repairs to be made prior to closing.
- Opendoor tends to pay more than other investors might since they are a larger company who is more focused on market share right now.
- The initial Opendoor offer is site unseen, so they can always change their mind or try to renegotiate once they make their visit to the home.
- Selling to Opendoor will likely net you less money than you could get on the open market and listed on the MLS with an agent or brokerage.
- Service fee to the seller can be as high as 12%
- Opendoor doesn’t buy every property that solicits an offer, so there is a chance that Opendoor won’t even be interested in your property.
Opendoor Reviews: (What are people saying about Opendoor)
Homeopenly Rating: 2 Stars
Mathew G of Charlotte, NC on 9/17/21 gave 1 Star: Awful condition of property. Steer clear 100%. A hobby flipper will do better work than this awful, heartless company. Plan to get under contract, have the home inspected and have the home fail, then fight for your deposit back. Unethical, untrustworthy, silicon valley garbage. Bleeding money and only hiring the cheapest, least intelligent and experienced labor. 100% bad, avoid at all costs!
Mike M, of Austin, TX on 9/10/2021 gave 1 star: Ridiculously low offer. I would never use them or recommend them to anyone. Houses on my block smaller than mine are selling for 35% more than their online offer. Horribly insulting and ridiculous.
Yelp: 1 Star
Sarah N, San Francisco, CA on 9/8/2021 gave 1 star:
I’m a little salty but they make viewing one of their homes absolutely terrible, especially if you have your own agent. They make it hard for the agent to schedule to view or to get the code to get inside.
We bid on a house they had on the market for over 30 days and had already dropped the price on once, from $210K to $202K. Purchased 4 years before @ $98K, most work was replacing carpets & paint as almost all fixtures, floors and wallpaper was original… We bid under, expecting a counter bid which they did. Their counter bit was $2K below asking price, no closing costs and the buyer would have to take on cost of all closing and the home warranty….We replied with $195K and they let the offer expire with no response.
Terrible company to deal worth, my realtor was frustrated trying to shake out a response, almost never could connect to a live person and just running around in circles. We also lost a day of viewings waiting to hear back from them.
Reviews.io: 4.36 Stars
Robert from Pheonix gave 5 stars: My wife and I couldn’t be happier with the way this sale went. It was sooooo easy! There was literally no stress for us. We didn’t have to worry about showings, repairs or any of the traditional hassle of a home sale. We were skeptical until the end but when we got the proceeds the day we closed i knew we were going to give a glowing review! Thank you so much Opendoor! I’m telling everyone that will listen.
Ellen from Los Angeles gave 5 stars: It was stress free, easy, and simple steps to sell the house. I had two little boys so cleaning up the stuff and setting up the schedule for potential buys was somehow stressful but selling my house to opendoor was very simple as it was and all the processing under the escrow was really easy to follow. Busy moms like me are recommended to try get an estimate from this company.
What did we Learn?
In short, if you are looking to sell fast with no prep on your house, as long as you are willing to leave some money on the table Opendoor may be a good option for you. You can call us bias, but we do feel there is a better way to have a smooth home sale without sacrificing your hard earned equity/profits.
- Exposure: With ListingSpark, your home will be marketed on your local MLS as well as 100’s of other real estate site, this ensures that more buyers see your home which translates in to higher demand and prices.
- Quality: All ListingSpark listings include professional photos to ensure your listing stands out against the competition
- Easy to Use Software: We make it a simple an easy process to get your home listed. Simply go to our website, and there is a simple step by step process for entering basic property info to get your listing going.
- Pricing Help: ListingSpark gives you accurate and up to date market data, to ensure your home is priced well.
- Listing Notifications: Stay informed with consistent updates about showings, feedback, offers and negotiations. You will never be wondering what is happening throughout the selling process.
- Savings: With ListingSpark, you get everything you would expect from an agent charging you a 3% listing commission for just $1499 ($250 paid up front). The average ListingSpark client saves over $10,000 in commissions. That’s real money back in your pocket.
Home inspections are a critical part of real estate. They impact both buyers and sellers and are key in negotiations and identifying any problem areas in homes.
Even if you’re buying new construction, you should be using a home inspector.
Building a real estate investor business is tough. You need to have the right people, the right processes, and the right tech to scale.
Even if you build everything right, things will still go wrong. The market isn’t always constant and you need to be prepared for shifts.
What should you do if the market goes down? How can you stay ahead as a real estate investor?
Real Estate Real Fast EP1 (with Romney Navarro, hard money lender expert and CEO of Streamline Funding)
If you’re looking to do some serious real estate investing, you might be interested in using a hard money lender. While most homeowners go with conventional financing, a hard money lender can be more useful for buying and selling properties.