My first (bad) investment experience with Roofstock

13 Replies

After spending almost half a year in reading the forums, books etc finally I got ready to do my first investment on Roofstock. I really liked a property that was from Memphis, TN. It was listed as a 'open house' property.

I made an offer of 175K. After the 'open house' period, the seller had 24 hrs to review and select an offer (according to Roofstock website). If the Seller does not take any action, the property gets listed in Roofstock again.

I did not receive any response during the seller review. One of the Roofstock representative told Seller has not accepted any offer and the property will be getting listed on roofstock again. He gave me the exact time at which it will be coming to open market.

I waited until then and when the property was available on the open market I purchased it. I got confirmation from Roofstock that the purchase was successful and I got a questionnaire to fill out. Market fees was debited on my card. My wife double checked and confirmed with Roofstock representative that we actually got the property. So far so good.

All these happened on Saturday.

Following Monday, got a one line text from Roofstock that the purchase was cancelled . I logged on to their website and the property was marked as 'Off the market'. I tried again after 30 mins to see it was in 'Sale pending' stage which means it was sold to someone else.

I wrote an email to roofstock asking for details. I am just getting weak apology replies stating it was their fault and would waiver the market fee on the next purchase.

What is interesting is that a Roofstock representative was closely working with me while I placed the order and confirmed that purchase went through fine and congratulated on the first purchase. Not sure what happened in between.

It is very frustrating.

Has this happened to anyone else?

I do not think this is normal. I am getting lot of questions in my mind and still have not heard anything convincing from roofstock.

Never heard anything like this happen on Rootstock before. We have sold a couple properties with them and everything went well besides it was a lengthy onboarding process to get it listed. They are a fairly new company and I am sure are experiencing growing pains and still figuring out their systems and processes. 

Thanks Sean. In this case, I am guessing, Seller did not act on any of the offers and after the review period ended Seller went to Roofstock.com to allow him to pick previous offers. Roofstock.com just cancelled my order and opened up the system for the seller. 

Atleast they should give a proper explanation instead apologies. 

I am just speculating. Still waiting for their reply.

Thank you for posting. I've been watching/analyzing Roofstock listings daily waiting for the perfect opportunity. I've spoken with one of their reps and have another call scheduled for Monday. Your experience is very helpful. Cheers!

Sure @Matt Schroeder . I will keep this thread updated with their responses. I have asked some pointed questions and waiting for their answer.

@Anandakumar Elumalai , to be honest, doesn't seem like too bad of an issue. They refunded your marketplace fee, offered to waive it the next time, and you did not have any loses involved.  I used Roofstock before, and although the deal fell through on mine, I'd still recommend using them if you find a good deal.

I've purchased three investment properties through Roofstock and I am currently in the process of purchasing a fourth.  I've purchased one investment property outside of Roofstock.  I agree with @Ross Yeager in that this isn't too bad of an issue.  Deals can fall apart for a variety of reasons at different points in the process.  You lost no money and Roofstock is making an effort to make it up to you by waving the market place fee of your next purchase which is $500+ depending on the purchase price.  I know it is a frustrating experience, but I wouldn't let this incident dissuade you from utilizing Roofstock to acquire investment properties.  

Originally posted by @Anandakumar Elumalai :

After spending almost half a year in reading the forums, books etc finally I got ready to do my first investment on Roofstock. I really liked a property that was from Memphis, TN. It was listed as a 'open house' property.

I made an offer of 175K. After the 'open house' period, the seller had 24 hrs to review and select an offer (according to Roofstock website). If the Seller does not take any action, the property gets listed in Roofstock again.

I did not receive any response during the seller review. One of the Roofstock representative told Seller has not accepted any offer and the property will be getting listed on roofstock again. He gave me the exact time at which it will be coming to open market.

I waited until then and when the property was available on the open market I purchased it. I got confirmation from Roofstock that the purchase was successful and I got a questionnaire to fill out. Market fees was debited on my card. My wife double checked and confirmed with Roofstock representative that we actually got the property. So far so good.

All these happened on Saturday.

Following Monday, got a one line text from Roofstock that the purchase was cancelled . I logged on to their website and the property was marked as 'Off the market'. I tried again after 30 mins to see it was in 'Sale pending' stage which means it was sold to someone else.

I wrote an email to roofstock asking for details. I am just getting weak apology replies stating it was their fault and would waiver the market fee on the next purchase.

What is interesting is that a Roofstock representative was closely working with me while I placed the order and confirmed that purchase went through fine and congratulated on the first purchase. Not sure what happened in between.

It is very frustrating.

Has this happened to anyone else?

I do not think this is normal. I am getting lot of questions in my mind and still have not heard anything convincing from roofstock.

175k for a SFR in Memphis? Not much in Memphis rents for $1,750.00. maybe this was for a flip.

@Ross Yeager :Thanks for sharing your thought. I read through your post. Sorry that you lost that deal. 

I do understand that not all deals work out. I just want to understand WHY mine was cancelled.

Roofstock offers a technology platform called a "Market Place" where the buyers and sellers interact to complete a transaction. Rules of 'Interaction' has been laid out by Roofstock.

If the rules are followed by the customers (Buyers & Sellers) , there is no reason for Roofstock employees to do anything as all the workflow is built into the system itself.   

As per the rules laid out, I was able to execute a purchase on the system. Now Roofstock manually overrides the system to cancel my transaction and sell the property to someone else. I just need to know why. I believe I am not asking for too much. 

Roostock.com is a great idea and innovative solution for out of state investors. I am fascinated about the concept. But, I cannot think of doing business with them until this is clarified. I am waiting for their answer. 

Would you buy anything on eBay, if your bid went thru but eBay cancelled it and offered to someone else? 

@Anandakumar Elumalai

We are sorry for your recent experience on Roofstock.

As explained in our email exchanges:

  • all offers, including yours, were made available to the seller
  • the system did fail to cancel all pending offers after the review period ended and our engineering team is looking into what happened and working to correct this error

We can also confirm:

  • your third offer to purchase the home after it was erroneously listed (given negotiations were on-going and had not been cancelled) after the review period was made available to the seller, who rejected it given the current higher offers he was negotiating
  • the seller was negotiating after the review period (this is the system error noted above that we are working on) with parties who bid on the property during the open house period and whose initial bids were higher
  • the seller is currently in contract with a buyer with whom he was negotiating with in the review period (and later) at a price in excess of your offers
  • we confirmed that an email was sent to your email address on July 14th @ 9 am that your offer expired due to the seller not taking any action

Lastly, one of our executives reached out to you via telephone a week or so ago and if you would like to discuss this matter further please feel free to call him.

We hope this clarifies what happened and again we apologize for the inconvenience.

@Zach Evanish with solid customer service as usual! Keep up the good work!
Originally posted by @Anandakumar Elumalai :

@Ross Yeager :Thanks for sharing your thought. I read through your post. Sorry that you lost that deal. 

I do understand that not all deals work out. I just want to understand WHY mine was cancelled.

Roofstock offers a technology platform called a "Market Place" where the buyers and sellers interact to complete a transaction. Rules of 'Interaction' has been laid out by Roofstock.

If the rules are followed by the customers (Buyers & Sellers) , there is no reason for Roofstock employees to do anything as all the workflow is built into the system itself.   

As per the rules laid out, I was able to execute a purchase on the system. Now Roofstock manually overrides the system to cancel my transaction and sell the property to someone else. I just need to know why. I believe I am not asking for too much. 

Roostock.com is a great idea and innovative solution for out of state investors. I am fascinated about the concept. But, I cannot think of doing business with them until this is clarified. I am waiting for their answer. 

Would you buy anything on eBay, if your bid went thru but eBay cancelled it and offered to someone else? 

I am not a buyer on Roofstock but a SELLER.. and I can tell you from a Sellers stand point.. any reasonable offer will put the deal to bed.

what I see on some of my props on Roof stock for what ever reason the buyers think they can offer 80k for a 120k prop.. that will never fly and Is a total waste of time for all 

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