The real estate industry has hit the trifecta: inventory is low, mortgage rates are low and buyer demand is high. Homes are currently selling within 21 days, on average, compared to 60 days this time last year. Yet, 35 percent of contracts in January 2021 were either delayed or terminated.
Even in a booming seller’s market, there’s a level of uncertainty with financing, inspection and appraisal contingencies that could come in the way. On top of that, 55-70 percent of sellers are also buyers. And the ability to unlock equity to win your next home is a top-of-mind issue, driving many homeowners to be hesitant to sell. They may be worried about their ability to find and finance their new home in a timely manner.
With Opendoor, sellers receive a certain all-cash offer that enables them to move quickly and on their timeline. Sixty-three percent of Opendoor sellers are also looking to buy another home. Our certain, fast and convenient all-cash offers reduce the risk of missing out on the next home of their dreams.
Today, we are making it possible for even more sellers to move with ease. Opendoor is expanding its buying capabilities across the U.S. to purchase a wider range of homes.
Qualifying more homes
The National Association of Realtors estimates annual median home prices to increase by eight percent in 2021. Though it varies by market, Opendoor has increased price ceilings across the country for the types of homes we buy.
We also operate in age-restricted communities, which are typically neighborhoods with homeowners over the age of 55 — a market that is expected to reach $732.1 billion by 2027 due to a growing senior population. According to the U.S. Census Bureau, baby boomers will account for 21 percent of the U.S. population by 2030. Opendoor will buy homes in age-restricted neighborhoods in six of our markets. We also now purchase homes in gated communities across 19 of our markets.
And we’re buying older homes. Sellers concerned about the difficulties associated with valuing older homes don’t need to worry. Now, we’re able to buy homes built as early as the 1930s to 1950s in the markets we serve across the country. Older homes can often require renovations and expensive repairs — around $18,000 on average — before listing, but selling to Opendoor allows customers to skip the stress and hassle of repairs.
Providing instant offers
We have increased the parameters of the types of homes we purchase by 35 percent, increasing our coverage of price, neighborhood, home type and year built. More sellers can request a free, no-obligation preliminary offer on their home from Opendoor in just three minutes. And homeowners who sell directly to Opendoor can close three times faster than average.
How are we able to value a wider range of homes so quickly? We’ve built a system that combines the best of human local expertise and sophisticated machine expertise. These systems account for specific home attributes, recent comparable home sales, and market and economic trends, all updated very frequently. This enables us to accurately forecast home price appreciation, even in a competitive market like today.
Saving you time and money
From home inspection fees to staging your home and conducting repairs, there are many other costs associated with selling your home. In fact, sellers can end up paying as much as 12 percent of the transaction, which is roughly $29,600 on a $250,000 home. And, on average, 20 percent of deals fall through.
With Opendoor, you have full transparency into the transaction, with no added fees or surprises. Plus, the added confidence of a certain sale. If you decide to sell to us, we take a service charge out of the sale proceeds similar to how an agent takes a commission in a traditional sale. And right now, our fee is no more than 5 percent, and it’s the only sales fee you’ll encounter.
After receiving an offer, simply conduct a video walkthrough and we’ll handle the work from there. Skip showings. Skip repairs. And skip the stress. Choose your close date and move on your timeline. And the process is managed fully online — an increasing preference of many sellers. In fact, our latest national survey found 71 percent of sellers said they would consider selling their home to an iBuyer like Opendoor.
We’ve helped more than 90,000 homeowners move on to their next chapter, with 9 out of 10 customers who sell to Opendoor saying they’d recommend us. We’re rapidly expanding to new cities to provide sellers with a flexible, convenient way to sell. We look forward to empowering even more customers to buy and sell homes across the U.S.
Considering a move? Get started here.
Amit Arora is Senior Director of Investment Strategy, Operations, and Analytics at Opendoor.