Opendoor recently announced a major departure for the company…in addition to focusing on recently built homes priced at approximately $300,000, Opendoor is now buying homes in the Los Angeles metro priced up to $800,000 that were built from 1950 forward.
The big takeaway from this newly announced company stance is that houses in the Los Angeles metro cost more than houses in Phoenix and Opendoor wants to “play” in Los Angeles. Los Angeles and parts of Orange and Ventura Counties have a current population total of approximately +13M people who may want to sell their houses at a date certain for cash offers on qualifying properties.
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According to Zillow, the median price for current listings in the Los Angeles metro is $849,900; the median price for sold properties is currently $710,400; and the median home value in the Los Angeles metro is $696,900.
With this announcement to broaden the company’s focus in order to buy older and more expensive houses in the Los Angeles metro, Opendoor also informed prospective Los Angeles buyers that they can use Opendoor’s app to search and tour any home on Los Angeles’s MLS as well as the “dozens” of Opendoor’s homes in the Los Angeles area that are located in southern LA and inland Orange County.
Approximately half of Opendoor’s Los Angeles listings consist of condominiums and townhomes. In fact, Redfin has already documented that one Los Angeles townhome property was sold on October 15, 2019 for $393,500 and was then relisted by Opendoor on October 31, 2019 for $415.000.
What are the reasons Los Angeles (and other) buyers and sellers may want to use Opendoor to sell their houses?
- Buyers who use Opendoor to purchase a house get 1% of the purchase price back after the transaction closes.
- Buyers who use Opendoor to purchase a house get a 90-day buy-back guarantee if they decide to rescind their purchase.
- Consumers who both buy and sell via Opendoor get 1.25% back after the transactions close.
Clearly, Opendoor is in the midst of a growth cycle.
- In September 2019, Opendoor acquired a title and escrow company.
- In November 2019, Opendoor added new partners, such as Lennar, Century communities and Gehar Homes, to its already 19-homebuilding developers that enable consumers to “trade up” to new houses throughout the country.
- Already, Opendoor has delivered +$1.5B in total sales to homebuilders throughout the country via is partnership program, according to Nate Harbacek, head of Opendoor’s corporate development.
Thanks to InmanNews’ Jim, Dalrymple II for source data.