Tech Startup is Buying Single Family Rentals (Phoenix, Dallas, Portland)

[Account Closed]

Keith Rabois' new startup, Opendoor, starts buying homes in Phoenix; Dallas, Portland next

Cromwell Schubarth

Silicon Valley Business Journal

Opendoor, the startup co-founded by Khosla Ventures partner Keith Rabois, launched Monday in its first market.

It is offering to buy homes in Phoenix, Arizona, and plans to move into the Dallas, Texas, and Portland, Oregon, markets next.

"Homeowners can trust and rely on Opendoor during one of the most stressful times in their lives," said co-founder and CEO Eric Wu, who used to work at online residential real estate site Trulia.

As I outlined in a Business Journal cover story in June, Opendoor makes an offer to buy a home after the owners give their address and some basic information. It arrives at the offer price without ever setting foot in the home, using an algorithm that mines data from public and private data sources.

Prices are usually a few points below what a seller might get on the open market. But Opendoor believes there are enough people willing to give up some cash to move quickly that it will be able to build its business around them. Before a sale is completed, a real estate agent or inspector working for Opendoor visits the home to make sure the description was accurate.

What do you think?

You'll be competing against not only funds and REITS, but now tech startups for single family rentals?

[Mitch VanDeveer]

The post states "Before a sale is completed, a real estate agent or inspector working for Opendoor visits the home to make sure the description was accurate."   In my interpretation they will offer more money than the average investor then go back during the inspection period with a significant offer price reduction to be able to buy where they should of in the first place.   Once seller reviews begin populate the internet with statements that they don't actually purchase properties for the original offer price their offers will have to come down into a normal range like the rest of us!