Why Should You Sell With Opendoor?
- Pros: Quick & effortless sale, convenient closing dates.
- Cons: Low scope for negotiation, limited coverage, high service fees, strict eligibility criteria, excessive repair charges but poor quality repairs, high chances of Opendoor backing out of the deal.
- Our Take: Selling to Opendoor is only feasible if you are on a time crunch and need money quickly. You can save a lot more with options other than Opendoor. View your savings.
What is Opendoor?
Opendoor is the country’s best and largest instant Buyer (iBuyer), offering instant cash offers on homes. Opendoor claims to offer 90% to 100% of the property’s Fair Market Value (FMV).
Additionally, you also get a preliminary cash offer within 24 business hours. But this price does not include repair costs, service fees, or closing costs.
Opendoor deducts a service fee of 5% from the final cash offer once you accept its preliminary offer.
- 💡 DID YOU KNOW? In August, Opendoor announced a multi-year partnership with Zillow that would allow home sellers to request an Opendoor offer on their home through Zillow’s platform.
» Companies that Buy Houses for Cash: Find out America’s Top iBuyer and Cash Companies
Is Opendoor Legit?
Yes. Opendoor is a modern, tech-savvy company, operating across 45+ markets nationwide. The company is also known to give fair cash offers compared to other cash home buyers.
Apart from being the largest iBuyer, Opendoor also provides services including home financing, buying from Opendoor homes, and Opendoor brokerage.
Presently, Opendoor offers iBuyer services in 48 metro areas.
Other services, like buying Opendoor homes, Opendoor brokerage, and Opendoor mortgage, are available only in certain areas. Depending on your location, you may need to check their availability.
What Types of Homes does Opendoor Buy?
The eligibility criteria for Opendoor are quite stringent. Further, it does not make exceptions and may back out of an offer if your property fails to fulfill any of the given criteria.
Your property needs to fulfill these conditions:
- Home type: Must be one of the 4 categories; 1) Single-family homes, 2) Townhomes, 3) Duplexes (only in certain markets), and 4) Condos (only in certain markets).
- Ownership and occupancy: The seller must have a clear, marketable title. The homes should also be occupied by the owners themselves. It should be vacant at the time of closing.
- Valuation: $100K to $600K, can go as high as $1.4M
- Year built: After 1930, can vary based on the market
- Max lot size: 2 acres, but they can buy homes with 1 acre or 1.5 acres in certain markets
- Home locations: Homes within Opendoor’s coverage
Opendoor may reconsider buying if your house is/has:
- Being sold as a short sale or foreclosure
- Renovated or has additions made without proper permits
- Foundation issues, flood damage, or damage caused by fire or natural disasters
- Presence of dated construction material, e.g. polybutylene plumbing or masonite woodruff roofs
- Has a well or septic system
- Presence of active organic growth e.g. algae, mold, etc.
How Does Opendoor Work?
Basically, Opendoor buys houses on a large scale to resell after flipping them. The costs for flipping are covered by repair charges that they deduct while buying your home.
Here’s a quick rundown of how an Opendoor home sale works:
1. You Request an Offer
To sell a home to Opendoor, you start by submitting your address and basic information to Opendoor.com.
Thereafter, Opendoor gives you a preliminary offer on your home after evaluating the local housing market. This service is free and does not obligate you to sell to Opendoor.
2. Conducting a Virtual Home Tour
If you accept their preliminary offer, Opendoor will evaluate the condition of your property by scheduling a virtual home tour.
Consequently, a company representative looks over the house on a video call with you. Otherwise, you can also send photos and videos of the property for verification.
The virtual walkthrough serves as a preliminary filter for your property to move forward to inspection.
3. Opendoor Schedules an Inspection
Soon after the virtual tour, Opendoor sends an in-house appraiser to evaluate and look into any material defects in the property.
Once the inspection is completed, Opendoor makes a final offer on your house within 2 days. This offer includes their 5% service charge and repair costs.
If you disagree with the final offer, you may cancel it. Cancellation does not cost you any compensation or penalty.
4. Closing on the Sale
Once you accept Opendoor’s offer, you can choose a closing date anywhere between 14-60 days.
To verify your home is in the same condition as when the assessment was done, you must provide information to an online dashboard before the closing.
Thereafter, the money from the sale of the house will be given to you a few days following closing.
Selling to Opendoor Reviews
Here’s a quick summary of Opendoor reviews found on various websites, including bbb.org, Reviews.io, etc.
✅ Seamless Experience
Your home selling experience with Opendoor is quick, easy, and comes with a preliminary offer within 24 hours.
✅ Skip Home Prepping
Most home sellers compliment Opendoor’s hassle-free home assessment. You won’t need to do the decluttering or staging part before selling your home to Opendoor.
Prior to the inspection and the final offer on the property, a quick virtual walk-through is required.
✅ Choose a Convenient Closing Date
Once you accept Opendoor’s final offer, you can choose a closing date between 14 and 60 days.
Many sellers thought this was more practical than using traditional agents who insisted on closing dates that suited them.
⛔ Zero Negotiation
Opendoor does not give you a chance to negotiate the price. Its offer is a give or take situation where you can either sell at their price or walk away from the deal.
⛔ Low Price Offers
Many Opendoor reviews complain about Opendoor making lowball offers for their property.
For the most part, Opendoor makes an offer based on the Fair Market Value (FMV) of the house. However, it is also known to make an offer as low as 50% of the home’s FMV in some cases.
⛔ Operates Only in Select Markets
Presently, Opendoor provides iBuyer services in 48 metro areas.
However, people in the suburbs and rural areas that fall outside Opendoor’s coverage are unable to use their services.
⛔ High Service Fee
Opendoor charges a service fee of 5% of the home’s selling price. Comparatively, FSBO websites or low-commission agents offer services for a lot less than this.
» For Sale By Owner Websites: Find Out America’s Top 12 FSBO Websites
⛔ Strict Eligibility Criteria
Opendoor’s eligibility criteria are too narrow and inflexible. If even one of these requirements is not met, Opendoor is unlikely to buy your house.
⛔ Excessive Repair Costs
Many customers have complained that Opendoor charges too high to cover even the basic repair costs.
In that case, selling FSBO and paying for the repairs yourself might be more cost-effective for you.
⛔ Opendoor Has Backed Out of Deals
The majority of reviews of Opendoor complain about them backing out of the offer at the last minute. This has caused a lot of stress and hassle for several customers.
Likewise, many customers experienced unresponsiveness after accepting the final offer. Additionally, Opendoor has reduced the final offer at their discretion without providing justification.
As a result, use caution when selling on Opendoor to avoid becoming the next victim of an Opendoor scam.
✅ Consider Opendoor if
- You’re on a time crunch and selling fast is your priority than money
- You simply need a free, no obligation offer.
❌ Avoid Opendoor if
- You’re looking for guaranteed offer. Not all homes get an offer. Opendoor has a strict purchase criteria
- You want complete control over additional costs for eg. repair costs.
Buying from Opendoor
There are 2 different ways of buying a house from Opendoor:
1. Buying Homes Purchased by Opendoor
Opendoor lists all the houses owned by it on its website. Interested buyers can view these properties on the website or Opendoor app, request details, and make offers.
The buying process is conducted like any other home sale. You can make an offer yourself or have an agent represent you.
You can also negotiate the selling price and closing costs after Opendoor accepts your offer. Typically, Opendoor home sales are closed within 14-45 days.
2. Buying a Home Through Opendoor Brokerage
Opendoor provides agent/broker services in certain markets. You just have to submit an offer on the website or through the Opendoor app.
Based on your requirements, you are assigned an Opendoor partner agent. This agent provides services like any real estate agent, from reviewing and making offers on your behalf to handling closing.
» Top Real Estate Agents: Find out America’s Top 10 Real Estate Agents
Buying from Opendoor Reviews
People who bought homes with Opendoor’s services have mixed reviews about the process. Here’s a summary of the pros and cons of buying from Opendoor reviews:
✅ Manage Showing Times Yourself
Managing showing times together is a big drawback of working with an agent. With the Opendoor app’s showing management technology, buyers can book showings at their convenience.
The ability to manage showing times through an app significantly lowers the need for an agent to schedule showings for you.
✅ Flexible Closing Date
Buyers can choose a closing date of their choice when buying through Opendoor. Generally, Opendoor home sales are closed within 14-45 days.
⛔ Poor Quality Repairs
Many people who bought homes from Opendoor often complained about the poor quality of repairs carried out in their houses.
Although Opendoor may demand excessive prices for repairs, it is difficult to track what repairs were done once ownership changes.
⛔ Less Scope for Negotiation
Although Opendoor claims to negotiate the selling price and closing costs with the buyers, many customers have experienced it differently.
While there may be room for negotiations, it is unlike working with an agent who brings the best deal for you.
⛔ Very Limited Coverage
Opendoor’s buying services are available in even fewer areas as compared to iBuyer services. Presently, Opendoor for buyers operates in only 37 metro areas.
And lastly, just 16 metro areas offer access to Opendoor’s brokerage services.
Other Opendoor Services
Here are some additional services Opendoor provides, depending on your location.
Also called Opendoor Trade-in, this service helps you avoid paying two mortgages at a 5% fee.
When you use Opendoor Complete to trade in, you use one of their agents. Hence, this service is limited only to the markets where Opendoor has partner agents.
Opendoor’s 90-Day Buyback
Designed as a guarantee to promote buyers, Opendoor also offers a 90-day buyback guarantee for a 3% fee.
So, if you’re not happy with your purchase, you get to back out within three months.
Opendoor Home Loans
When buying a home, most buyers require a mortgage. In select markets, Opendoor offers instant financing to homebuyers.
Opendoor backs your offer with cash, without extra fees. In the event that you cannot secure money in time, Opendoor buys the home and holds it for you for up to 120 days.
Once you obtain the loan, you can buy back the home from Opendoor.
The Opendoor service charge is 5% of your home’s sale price. However, closing costs and repair deductions could increase the total fees by 7–10%.
Here’s a breakdown of Opendoor service charge plus other costs:
Calculate Your Savings
Alternatives to Opendoor
The competitive real estate market provides home sellers and buyers with multiple options to fulfill their real estate needs.
Today, people can manage complicated home sale transactions all by themselves. Moreover, Flat Fee MLS companies like Houzeo provide FSBO home-sellers with cutting-edge technology.
Here’s a quick glance at what Houzeo does for you:
Houzeo vs Opendoor
Why It’s #1: Houzeo has thousands of 5-star reviews. It offers the best combination of maximum savings, advanced technology, 5-star customer support, and listing exposure.
Packages: Houzeo typically offers 4 Flat Fee MLS packages.
- Bronze Package – $299+: It is the best for selling a lot. Your listing gets syndicated to Zillow, Trulia, Realtor, Redfin, and more.
- Silver Package – $349+: This includes everything that home sellers typically look for.
- Gold Package – $399+: It is Houzeo’s signature MLS package and includes all the technology Houzeo is known for Houzeo Showings, Houzeo Offers, and DigiTransact.
- Platinum – $999+: It includes the assistance of a licensed broker to help you with negotiations, disclosures, and closing.
👉 Our Take: We recommend the GOLD plan. You’ll have all the access to Houzeo tech, making managing showings and offer negotiations easy!
» Houzeo Reviews: Houzeo is 100% online. You can finish listing formalities in less than 60 mins.
Houzeo has 4.9 out of 5 stars on Google & Trustpilot.
» Houzeo Reviews: Check out what customers have to say about Houzeo.
Houzeo is available nationwide.
Here’s an overview of Opendoor’s and Houzeo’s features compared:
|100% Online Process||✅||❌|
|Offers Sent Directly to You1||✅||✅|
|Request the Highest & Best Offer2||✅||❌|
|Showing Time Management3||✅||✅|
|Fast Listing Changes||✅||❌|
|Buyer Property Search Feature||✅||✅|
1 Offers are typically routed to the brokers. Houzeo’s Offers Platform allows your broker to present the offer to you instantly.
2 Houzeo Offers allows sellers to Counter an Offer and Request Highest & Best Offers Online.
3 Houzeo Showings is available both on Houzeo’s website and on the Houzeo mobile app.
4 Available only on weekdays up to 1 pm, and only in select MLS’. After you’ve purchased the Gold or Platinum plans, email firstname.lastname@example.org with the subject line “Expedited Listing Request: “. Service is free for Gold and Platinum plan customers
- 💡 DID YOU KNOW? Home sellers on Houzeo have received offers from a variety of cash buyers, including iBuyers like Offerpad and Opendoor.
Although Opendoor is the first and biggest iBuyer currently, it is not the only one in the housing market.
Here’s an overview of some of Opendoor’s top competitors:
|Parameter||Opendoor||Offerpad||RedfinNow||We Buy Ugly Houses|
|Repair Costs||Deducted from Offer||Deducted from Offer||Deducted from Offer||Deducted from Offer|
|Partner Agents||In-house Agents + Partner Agents||In-house Agents||In-house Agents||In-house Agents|
|Flexible Closing Date||✅||✅||✅||✅|
|Cancellation Dues||None||1% if 4 days after inspection report||None if repair addendum is incomplete||None|
|Late Checkout Option||✅||✅||✅||⛔|
» We Buy Ugly Houses Reviews: Find out Whether This iBuyer is Worth Your Money
Other Options You Should Consider
1. Sell to “We Buy Homes for Cash” Companies
Unlike iBuyers, “We buy homes for cash” companies help you sell your house as-is fast. They can even close within 7 days or any date you choose. “We buy homes for cash” companies also make cash offers for homes outside metro areas or in difficult-to-sell locations.
Here’s why traditional cash home buyers could be a bad option for you than an iBuyer:
- They make lowball offers and offer only 50% – 70% of market value.
- Their offers are non-negotiable
👉 Our Take: We recommend selling to a cash home buyer if you are selling a distressed house “as-is” without looking for the best price.
» “We Buy Homes for Cash” Companies: Check out America’s biggest cash home buyer companies in 2023
“Cash for Homes” Companies Near You
2. Sell FSBO With Flat Fee MLS Services
Listing with a Flat Fee MLS service gets your house on the market within just 24-48 hours. Selling For Sale By Owner has increased substantially in the past few years, with 77% of FSBO homes being sold in less than 2 weeks.
Flat Fee MLS is one of the best ways to sell your house fast, and it has 4 major benefits:
- MLS is the fastest way to hit the market, plus your listing is syndicated to Zillow, Realtor.com, etc.
- Your listing gets maximum exposure.
- You can negotiate all offers.
- You skip paying commission or service fees.
👉 Our Take: We recommend Flat Fee MLS companies for most home sellers. They are fast, and you will save thousands in commissions.
» For Sale By Owner Websites: Check out the rankings for America’s best FSBO websites
Final Word: Is Opendoor Worth it?
To conclude, Opendoor’s offers and services come with their advantages and drawbacks. Finding which one suits your needs best is the way to decide whether or not to sell to iBuyers like Opendoor.
With its fair offers, extremely low fees, and ease of operation, Opendoor is worth a shot. Opendoor cash offers are generally in line with fair market value.
In fact, in early 2021, Opendoor paid a median of 107.7% of a house’s estimated value, compared to just 98.6% in 2019, indicating a seller’s market.
However, while selling to an iBuyer, you have no option to compare the offer received with other offers. Opendoor’s offer is final and non-negotiable.
On the other hand, when you sell a home traditionally, multiple buyers will be interested in your property and bring in competitive offers.
In order to sell your home for top dollar and save on the listing agent’s commission, you can work with a Flat Fee MLS service like Houzeo.
Frequently Asked Questions
1. Are Opendoor offers legitimate?
Yes. Opendoor is legit. Their business model is to turn around your house and sell it on the open market. Opendoor fees represent the carrying and resale costs of homes they buy.
2. Does Opendoor negotiate offers?
Yes, Opendoor negotiates offers and will typically send a counteroffer via email and/or phone until an agreement is reached.
3. Will Opendoor pay buyer's closing costs?
No, Opendoor doesn't pay buyer's closing costs. If you sell to Opendoor, you still have to pay 50% of the closing costs.
4. Does Opendoor pay market value?
Yes, Opendoor is a legitimate company. Although Opendoor may not pay your home's full market value, it makes all-cash offers that allow you to close on your sale in as few as 14 days.
5. Does Opendoor offer lease back?
Opendoor offers a Late Checkout program that enables you to close your home sale, receive your proceeds, and temporarily rent back your home from Opendoor for up to 14 days.
6. How is Opendoor different?
Opendoor is actively buying and selling homes in over 45 metropolitan areas, more than any direct competitors. Compared to the traditional housing market, they are making it easy for home buyers to find their next home. Touring any Opendoor-owned home on any day of the week from 6am to 9pm is possible, no appointment needed.
7. What's the catch in Opendoor's Preliminary Offer vs. Final Offer?
Opendoor will share a preliminary cash offer for your house in 24 business hours, which is the best price you can get for your property.
Opendoor's preliminary offer is usually non-negotiable, and only if you accept it the company schedules an onsite inspection. The repair costs and other expenses (1% to 3%) and Opendoor's service fee of 5% are deducted from your proceeds. The final cash offer is calculated accordingly, and you lose roughly 6% to 13% of the home's sale price.
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