Often credited with launching the "iBuyer" movement, Opendoor offers qualifying homeowners fast and convenient alternative to the traditional home selling process.
The company makes near-instant cash offers on qualifying homes — typically within 24 hours of request. It also offers sellers fast and flexible closing timelines, ranging from 14 to 60 days.
The company charges a service fee to offset its carrying costs and ensure profitability, which ranges between 6-14%. The average is 7.1%, which is comparable to the traditional 6% real estate agents charge.
Opendoor operates on an absolutely massive scale. This high-volume approach means it can maintain a much thinner margin on each transaction. Translation? Unlike a traditional house flipper, it makes fair offers for the homes it buys.
But what if you're not happy with the offer you get? Is there any room for negotiation? Read on to learn more.
Can you negotiate with Opendoor?
Opendoor's willingness to negotiate largely depends on whether you're buying or selling a home. They appear to be more flexible on price with buyers versus sellers, and the negotiation process with each is a little different.
Does Opendoor negotiate with buyers?
If you're buying a home through Opendoor, there's room for negotiation on price just like in a traditional home sale.
One thing to remember is that they're trying to save money by not using a real estate agent, which may give you more leverage in negotiations. It's usually in the buyer's best interest to work with a real estate agent who is skilled in negotiations and the buying process at large.
This not only helps you get a fair price, but can also provide expert guidance with the home inspection, market research, and the closing process.
Will Opendoor negotiate with sellers?
Opendoor doesn't offer much room for negotiation with sellers. It relies on advanced technologies, massive amounts of data, and a team of in-house experts to arrive at a fair offer price for your home. If you like the offer, you can accept — if not, you're free to decline. Unlike many of its competitors, you won't incur a penalty if you decide not to accept Opendoor's offer.
That said, if you believe Opendoor undervalued your home or overlooked some important detail, you can request a second evaluation and submit additional evidence/information as to why you think your home is worth more.
Does Opendoor perform a home inspection?
Opendoor will make a preliminary offer based on the info you submit online, then follow up with an on-site inspection before committing to a final price. Here's a quick overview of how it all works.
To start, the seller will provide details about their home, such as square footage, number of bedrooms and bathrooms, unique features, upgrades, and other attributes. The company compares your home to other homes in your area and what they sold for. Within 24 hours, you'll have a cash offer waiting on you.
Opendoor does all of this without ever stepping foot inside your home. It relies largely on market data and local trends to calculate the home's fair market value.
Once you accept the offer, Opendoor will send out a representative to inspect the condition of your home and see what repairs need to be made. You'll have the option to take care of the repairs yourself or let Opendoor handle them. If you don't want to deal with the cost of repairs, Opendoor can handle them for you and will deduct their cost from their offer to you.
How can you successfully negotiate with Opendoor?
Whether you're buying or selling a home, there's no written rule anywhere that you can't negotiate an offer. The key is to be prepared with data that can back up any disputes in pricing and show why you feel an offer is too low (for sellers) or too high (for buyers).
There are a few things you should put in your your negotiation toolbox:
A comparative market analysis (CMA) is a professionally prepared research document that looks at homes in your area that are similar in size, style, features, location, and other criteria. The goal of a CMA is to accurately determine how much your home is worth.
Also, past sales data for your home may help give you negotiating power. You can show what you purchased the home for and the improvements you've made to the home throughout your ownership.
It's a good idea to save sales receipts for upgrades and renovations so you can prove how much you spent. Upgrades can vary in price depending on the area, so sales receipts can help to put these costs into perspective.
Will you make more selling with Opendoor or working with a realtor?
Unfortunately, this question doesn't have a clear or definitive answer.
The key difference between Opendoor and selling with an agent on the open market is certainty.
When you sell to Opendoor, you're guaranteed a fair price for your home and have the flexibility of defining your own sale timeline.
When you sell with an agent, there's less certainty regarding both timeline and price, but the possibility of getting above fair market value for your home is there.
It really boils down to your situation and priorities.
Are you looking to sell quickly or with as little hassle as possible? Assuming you qualify, Opendoor is probably the way to go.
If you have a little more flexibility and want to see if you can get a better price on the open market, listing with a top agent is worth giving a shot.
Again, assuming your home qualifies for an Opendoor purchase, if the traditional listing isn't getting the results you're looking for, you can always pull the plug and go for the cash offer.
Either way, it's worth exploring both options before making a final decision. After all, requesting an offer from Opendoor and interviewing agents are both free and come with zero obligation.