Opendoor.com Market Impact

[Matt Shields]

Here in Phoenix Opendoor.com has been operating for a couple of years. They have become one of the largest brokers in Arizona and is now expanding to other parts of the country. It is a flipping company on a massive scale that was started by some silicon valley tech people with a shipload of money behind them. The difference between them and other flippers is that they seem to pay near market value, and make their profits from around 7-10% brokerage fees. Considering holding/closing costs, this seems like a pretty slim margin especially when they offer incentives like a 30-day money back buyers guarantee.

Opendoor appears to be sucking up a lot of deals in the Phoenix area that would normally be purchased by traditional flippers. If they are active in your market have you seen an impact?