Love it or Hate it? Opendoor, Offerpad, UpNest, Zhomes, etc

[Robert Adams]

Just curious what the community's thoughts are on these types of listing/selling services that buy and relist. 

(Love it or Hate it? Opendoor, Offerpad, UpNest, Zhomes, etc)

I have seen an increase in homeowners using these types of services.

I have my own thoughts that I will share later but I would like to get some unbiased opinions first.

Thank you.

[Steve C.]

I'm certainly a biased opinion as an agent in town, but I'm not a fan. On the purchase side, when shopping for a home, one listed by open door on the MLS with a sign in the drive way didn't even show up on their app to view the home, so they missed a potential sale. On the listing side, they're offering a quick close in exchange for 10-30k in value left on the table, with fees adding up to a 7% commission + closing costs. Generally they're buying low, painting, maybe replacing a room of carpet & re-listing 15-30k more. for A traditional sale in this market will move just as fast & help the seller retain that equity in the sale. Who ever is the investor with a broker's license running it.. good for them, not so good for the clients.

[Robert Adams]

I just got a notificatioin about this post being voted on. Wow 4 years ago. Time flies. Anyone have updated thoughts on the iBuying now that is much more well known?

With Zillow out of the iBuying game, opendoor and offerpad seem to be the two dominate iBuyers here is Vegas. We have buyers in escrow with both companies right now. We also have one buyer in escrow with Zillow (One of their previously purchased homes before they stopped buying.)

[Mark S.]

Ive never bought from any of them, but Opendoor among others contact me all the time to make offers to me.... by phone, text, mail, email. 

[Josh Carlos]

I'm a mobile notary/loan signing agent, and I actually work with the prop-tech division of First American which handles the offerpad closings. From the reactions at the closing table, it seems to be hit or miss on the customer experience. I know if there is no agent involved then offerpad charges 4% to 5% in place of the commissions that the agents would normally split in a traditional transaction. 

I know I've met a lot of investors who are using them to basically liquidate their holdings here and look for other opportunities.

[Al D.]

@Robert Adams: I decided to look up “Upnest” here because I had just recommended it to a friend for an upcoming sale, and came across your post. Besides getting mail from some of the others you mentioned to sell to, I’ve only had experience using Upnest as a seller:

I used it in 2019, when I found myself without a local agent I could trust in a remote market where I suddenly decided to sell. While I could ask a well-known (highly-networked) agent in my local market for a referral, I knew that it would not be free to me somehow in the end (I once paid a 7% commission for a tough to sell remote property, where I used such a referral, and it was well worth it - for that property.) This property had no issues, the market was already slightly favoring sellers, and I only wanted to find a good (enough) agent for the lowest possible commission.

I believe I had a choice of 3 or 4 agents within minutes of giving my info to Upnest. While I can’t remember now whether I chose the lowest quote, or perhaps the agent I chose was offering certain “value-adds” despite being the second-lowest quote, I contracted for a 4.8% commission.

I sold to a retail buyer. My experience was positive; I am sure that the agent made all the difference, regardless of how she came recommended.

Of potential interest: A couple of the offers - "insultingly" below my asking price - were from some LPs/LLCs, one of which was definitely a REI arm of a large private equity firm.

[Bill B.]

I think 99 out of 100 buyers and sellers would take ibuyers over wholesalers. I’d say 100 out of 100, but 1 in 100 are wholesalers these days and they’d probably vote for themselves. 

On average I would bet these ibuyers offer 20% or more above the wholesalers. (We’re talking $40-80k more. How much does a wholesaler think they should make for a few hours work? We already complain about realtors and they want 1/4th as much, maybe less.) And they don’t bother you with 10 postcards and 20 phone calls. I only ever asked for a quote on one of my properties and it was about 10% below what a realtor said they thought they could get.  And that was cash in 3-30 days, my choice. Luckily I didn’t take it and 4 years later offers are up about 100%.