Wholesaling to Opendoor?

[Micah Piller]

Has anyone tried to/had success with assigning/double closing a wholesale deal to Opendoor?

I came across a seller that had almost zero equity in his home and was facing foreclosure auction in less than 1 week. He was willing to sell below market value, but the numbers didn't work for me to purchase it or even wholesale it. In looking out for his best interest I suggested he turn to Opendoor to see if they could purchase the home before it went up for auction and sure enough, they offered him just below market value for his home.

I was curious to see if anyone's wholesaled a deal to Opendoor? Thanks!

[Ankur Sethi]

If you are a licensed real estate agent you should have taken their referral fee for referring them to Opendoor. 0.75%

[Robert Adams]

I havenot fone any wholeselling with them but this is what I have put togetherso far in Vegas.

Here is how it works:

Over the past 7 years the Vegas Valley has seen enormous growth in the housing market and home values. Many people have no idea what their home is worth. Some homeowners even rely on outdated autovaluations like Zillow's Zestimates for home values. Then opendoor or similar company gets in touch with a homewoner (because they are spend an insane amount of money on marketing to reach sellers that are not in tune with the market). FOR EXAMPLE: The homeowner maybe bought their home in 2011 for $200k for the sake of round numbers. Now lets fast forward to 2018 and the home is now worth $400k. The seller looks on websites like Zillow and sees there home is worth $380k. This seller is already underselling themselves by $20k, but wait it gets worse. Then opendoor comes along and says we think your home is worth $370k to $380k BUT we will buy it right now from you without you having to market the home or do any showings etc for $375k but we are going to charge you a fee up to 12% (in our example this would equate to $45,000). Then on top of that they charge a 7% Commission (that would equate to additional $26,250). Then opendoor would clean the home, maybe paint it, maybe put new carpet if you are lucky then resell your home for $400k in a week or two. Below I have compared 2 examples of selling traditionally with a Realtor at 6% commisions (which it may be less as it is negotiable) vs selling with opendoor or similar service.

Comparing Opendoor to a Traditional Sale with a Realtor

$400,000 Home via Opendoor Home Value: $400,000 Sales Price: $375,000 Charge 12%: $45,000 Commissions 7%: $26,250 Total Costs via Opendoor: $71,250 Net Proceeds to Owner: $303,750

$400,000 Home via a Realtor Home Value: $400,000 Sales Price: $400,000 Traditional Closing Costs 3%: $12,000 Commissions 6%: $24,000 Total Costs via a Realtor: $36,000 Net Proceeds to Owner: $364,000

In this Example Selling with a Realtor will save you $60,250!!!

Most homeowners I know could use an extra $60,000+ in their pocket! It is my firm belief that homeowners do not know how drastically their bottomline is affected by selling with these unethical companies.

BEFORE YOU SELL WITH ANY COMPANY ASK THEM "HOW MUCH MONEY WILL I WALK AWAY WITH?"AND THEN COMPARE THAT TO A TRADITIONAL REALTOR SALE.

I confronted them on a public post of Opendoor on Facebook, you can see for yourself how it went below
(after my question about them charging 19% they stopped responding):
HERE IS THE ORIGINAL POST

[Jay Hinrichs]

@Robert Adams  they low balled one of my Dallas properties I just would not sell to them because and I waited a few weeks and got 25k more.

but its the power of radio marketing at play.

[Robert Adams]

sounds accurate Jay!

[Jesse M Robles]

https://www.opendoor.com/w/faq/what-does-it-cost-to-sell-to-opendoor

[Bob B.]

Here is a house near me that they have listed for $340,000.  Looks like they paid $337,000 in July.  Looks like they aren't going to make money on this one.

4211 Mabry Rd Roswell, GA 30075

[Akilah S.]

@Bob B. Great example! I figured the market shift would bite them in some cases. Looks like the homeowner came out the winner since it wasn't moving when they listed either. 

[Bob B.]

@Akilah S.  I passed the house this morning, it's still for sale and the roof is covered in pine straw. New price is $338,000 which is $1,000 more than they paid in July.  

[Akilah S.]

@Bob B. It's new price is even lower @$335,000 as of 1/17 according to Zillow and Realtor. They're definitely taking a loss on this one. 

[Marc Winter]

What am I missing here...  If they made 18% +/- on the buy, they could actually sell for less than they paid and still not be in the red.  No?

[Bob B.]

@Marc Winter  If you are asking about the house I referenced.  It sold in 9/17 for $235K and was rehabbed.  It sat on the market for 4 months and OpenDoor purchased it in 7/18 for $349K and now have it listed for $335K.