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By Home Bay

Posted on May 9th, 2022

Opendoor fees | Opendoor reviews | Selling to Opendoor | Buying with Opendoor | Locations | Opendoor vs. realtor | Opendoor competitors | FAQs | Contact

Opendoor logo

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Opendoor is an iBuyer — a real estate company that buys houses for cash and then resells them on the open market.

Opendoor buys more single-family houses than any other iBuyer and is active in {ibuyers.opendoor.city_count} cities across the country. Customer reviews show that people who sell to Opendoor are generally satisfied with how quick and easy the process is and how competitive their offers are. Data from iBuyer expert Mike DelPrete suggests that Opendoor usually makes higher offers than other iBuyers.[1]

However, selling your single family home on the open market with a real estate agent will likely net you more money than selling to Opendoor. Opendoor charges a 5% service fee, plus deductions for repairs and closing costs. Real estate agents typically charge a 6% commission, but you'll usually receive higher offers and have more control over repair costs.

» COMPARE: Opendoor vs. selling with a realtor, which is right for you?

You can save even more money by selling with Clever Real Estate. Clever's full-service partner agents list for just 1% or a flat fee of $3,000. For the average home, that adds up to total savings of $5,000 or more!

👋 Find top local agents, save thousands on realtor fees!

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What is Opendoor?

Opendoor is the largest iBuyer by volume in the United States and is currently active in {ibuyers.opendoor.city_count} markets, with plans to reach 100 markets.[2]

iBuyers buy single family houses that require minimal repairs and renovations, then resell them on the open market for a small profit.

Opendoor charges sellers a 5% service charge at the end of a home sale, which is slightly less than the typical realtor commission of 6%. However, Opendoor also doesn't make offers that are in line with what home sellers can expect to get on the open market, so it's likely that a realtor will still help you to net more money in the end.[3]

Opendoor provides an end-to-end real estate experience for customers, so they can buy, sell, and trade-in their home (Opendoor Complete) online with minimal hassle.

The company also has other real estate services like repairs, financing, and title insurance to streamline the process while generating more revenue.

Yes — Opendoor is a legit real estate company that buys and sells single family homes in over 40 cities across the country. Opendoor charges a 5% service fee to home sellers and can close in as little as 10 days, but the company's instant offers are slightly below the typical open market sale price. The service charge is deducted from the final sale price.

Opendoor was founded by Eric Wu in 2014 as the first iBuyer. Other companies, like Offerpad and RedfinNow, have adopted a similar business model.

Opendoor has raised a combined total of $1.9 Billion from venture capital investors since 2013, and went public on December. 21, 2020.[4]

Home buyers can also use Opendoor's cash to make a non-contingent cash offer in a competitive market.

» JUMP TO: See what actual customers think of Opendoor.

How much does Opendoor cost?

Opendoor’s service fee for home sellers is 5% of the final sale price, but the total cost ranges from 7–10% when closing costs and repair deductions are included.

Closing costs are approximately 1–3% while deductions that Opendoor makes for repairs can range from 1–2%.

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If you're concerned about fees associated with Opendoor's offer, Clever can connect you with top local real estate agents who charge just 1% or a flat fee of $3,000 to list your home. Clever works with partner agents from trusted brokerages like RE/MAX, Keller Williams, and Coldwell Banker.

You'll get maximum value for your home on the open market and save thousands of dollars in commission!

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Opendoor makes offers on the following types of homes:

  • Single family
  • Townhouse
  • Duplexes (select markets)
  • Condos (select markets)

In addition, Opendoor’s criteria for purchasing a home includes:

  • Valuation between $100,00 and $600,000 (but can be as high as $1.4 million in some markets)
  • Maximum lot size of 1–2 acres, depending upon market
  • Built after 1930
  • Owner-occupied

While these are the general criteria, there may be exceptions or additional requirements in certain markets.

Opendoor's preliminary offer is usually 2-5% higher than the company's final offer, so it's good to think of your preliminary offer as an estimate. That's because the "instant" cash offer is an estimate based on information you provide Opendoor about your home's size, age, and features.

The final offer you receive from Opendoor includes deductions for repairs, which can range from 1-2%, and seller closing costs, which can range from 1-3%.

Note: According to its terms of service Opendoor might not be able to make a final offer to buy your home if the estimated repairs exceed $20,000.

Pros and cons of selling to Opendoor

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How Opendoor works

Most Opendoor customers start their experience online.

  • Sellers can get an offer from Opendoor within days of submitting the online form and close in 14–60 days, depending on their desired timeline.
  • Buyers can submit an offer online or through their agent and close in 14–45 days, depending on their desired timeline.

For sellers

Sellers start the process by completing an online estimate form to request an offer from Opendoor.

The form asks for things like:

  • Your location
  • A picture of your house
  • A description of your house
  • Details about any upgrades/renovations that you are aware of

Opendoor will use this information to provide you with their initial estimate before sending a real estate inspector to the property. Opendoor's offer includes a range that approximates the final sale price.

The process goes like this:

  1. Complete the online estimate form to request a cash offer.
  2. Receive an offer from Opendoor.
  3. Schedule a virtual walkthrough of your home.
  4. After the inspection, get a final offer from Opendoor that includes repair deductions.
  5. Accept the offer, sign the purchase agreement, and pick a closing date.
  6. Get paid within a few days of closing.

According to Opendoor's website, you can cancel your contract at any time before closing if you decide not to sell.

There's no penalty for canceling the sale — unlike Opendoor's main competitor, Offerpad, which charges a 1% cancellation fee.

For buyers

Opendoor lists the houses that they own on their website where potential buyers can browse and request information.

  1. Find a home online or through the Opendoor app.
  2. Take a private tour using the app.
  3. Submit an offer through your agent or by yourself.
  4. Opendoor will respond in 24–48 hours.
  5. If your offer is accepted, your agent can draft a purchase agreement.
  6. Sign and go to escrow.
  7. Make your earnest money deposit.
  8. Schedule inspection and negotiate repairs/closing costs.
  9. Close in 14–45 days.

The Opendoor app allows you to manage your entire transaction with Opendoor on your smartphone, whether you're buying or selling. The app is convenient if you're comfortable doing a major transaction on your phone, but could be frustrating if you'd rather have a more personal touchpoint.

If you're selling your home, you can request an offer and see your selling options through the app.

If you're buying a home, you can use the app to browse Opendoor listings, access Opendoor-owned homes, and even submit an offer.

The Opendoor team will communicate with you through the app for the duration of your transaction.

You can download the Opendoor app in the App Store for iOS devices or on Google play for Android.

Opendoor locations

Opendoor is currently active in {ibuyers.opendoor.city_count} major markets across the country, including:

  • Phoenix
  • Atlanta
  • Houston
  • Los Angeles

As Opendoor expands and iBuying becomes a more popular alternative to a traditional real estate sale with an agent, Opendoor plans to become active in 100 markets from coast to coast.

Opendoor reviews from real customers

The majority of Opendoor reviews from customers are positive, with an average rating of {ibuyers.opendoor.average_rating} across {ibuyers.opendoor.total_reviews} reviews.

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Positive Opendoor reviews focused on:

  • A fast, seamless transaction.
  • A done-for-you selling experience that matched the customer's desired timeline.

Negative Opendoor reviews focused on:

  • Inflated repair costs.
  • An inability to negotiate Opendoor's offer price.

To decide whether accepting a cash offer and selling to Opendoor is worth it, your best bet is to compare your offer to what your house could sell for on the open market.

We recommend asking a local realtor for a comparative market analysis (CMA) that shows you what your home is really worth.

What customers liked

Trey noted that the offer he received was competitive, and he was very pleased with his experience selling to Opendoor.

Trey. A relative told me about Opendoor. I didn’t think too much about it but decided to see what it was about. I reached out to Opendoor during the night
and the next day the process started. We were offered a competitive price for the house and after some family discussions, we accepted. Closing timeframe was up to us. No hassle, no showings. I will use Opendoor again in the future if I ever have to move
again. Source: reviews.io

Ellen appreciated not having to show her house to multiple buyers and said that working with Opendoor was easy.

Ellen. We had a very seamless experience selling our house to Opendoor. Who would have ever thought you could sell your house without having people coming thru
or doing any showings! Not to mention I was able to move at my own pace and definitely received a fair price! I would highly recommend Opendoor! Source: reviews.io

What customers didn’t like

An anonymous reviewer from Texas said that Opendoor did not negotiate fairly.

Anonymous. I am not impressed with OpenDoor in TX at all as a buyer. They are not transparent. It’s difficult to negotiate with them re: fixes or price.
They do not bring down the price much even if the home is old and needs renovation badly and are not reasonable regarding fixing homes. They own the home we are buying and they do not care about the quality of the home very much. They do not even agree
to pay for the first year home warranties that most sellers would pay for. Their agents that we worked with kept changing so there’s no continuity and you feel like you are working with a robot. Not impressed! They also won’t let us show the
home or list it on MLS till closing. Not sure if this is a standard process. Source: reviews.io

R Pearis says that the experience didn’t meet his expectations, but he really likes the idea behind Opendoor’s service.

R Pearis. Love the concept, the execution with myself purchasing a home from them though leaves a lot to be desired when it comes to inspection repairs, closing
costs, etc. I understand they are in it for the profit but my experience is ridiculous. I am missing the personal touch of dealing with a person who understands that list price is negotiable and is based upon there being nothing at fault with the house.
Source: reviews.io

Selling to Opendoor vs. listing with a realtor

Selling to Opendoor is more predictable and sometimes faster than selling with a realtor. That’s because Opendoor can make an offer quickly and close when you want while realtors can’t guarantee that the right buyer will come along quickly.

However, a realtor will be able to net you more money by getting your house in front of multiple buyers ensuring that you get the best possible price.

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Opendoor charges a 5% service fee that’s slightly lower than the 6% commission that real estate agents are typically paid. Closing costs and repair fees are still a factor in either case.

Agents have an incentive to get the most possible money for your home because the more you make, the more they make in the form of commission. Opendoor, by contrast, has an incentive to pay less than a private buyer for your home.

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» LEARN: Does Opendoor negotiate?

Opendoor alternatives

Opendoor alternatives include leading competitors like Offerpad and RedfinNow, companies that also buy houses in select markets.

Opendoor stands out because:

  • Their service fees are low.
  • There’s no penalty for walking away from a deal.

But, other iBuyers like Offerpad have their own unique advantages, like free local moves and a closing date of up to 90 days from the time you accept an offer.

Here’s a quick comparison of how Opendoor stacks up against the alternatives:

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Other Opendoor services

Beyond buying and selling, Opendoor offers a variety of invcentives and services, such as home buyer rebates, that help customers to save money while benefiting from a streamlined transaction.

These incentives allow sellers and/or buyers who are work with Opendoor to:

  • Trade in their home
  • Get a cash rebate on the closing date

Opendoor Complete

Opendoor's home trade-in service is called Opendoor Complete.

With Opendoor Complete, you can purchase your next home using Opendoor's cash, then list your old home once you've moved.

Using Opendoor's cash allows you to make a non-contingent cash offer on your next home, which could be a huge advantage in a competitive market because it'll make your offer a lot more attractive.

The program also helps you avoid paying two mortgages at once, but you'll still have to repay the mortgage on your old home once it sells.

The fees for the program is "as low as 5%," which leads us to believe that it could be higher in some markets.

Direct buyer incentive

If you purchase a home directly from Opendoor without the help of a real estate agent, Opendoor offers a 1% credit back at closing (in select markets).

One of Opendoor’s greatest costs when they sell a home is having to pay the buyer’s agent commission, which is around 3%. This incentive rewards sellers for helping Opendoor reduce their costs.

Buyer refund

If you buy an Opendoor home with one of their partner agents, you are eligible for 1% cash back at the time of closing.

Opendoor has a network of partner agents that they can refer buyers to when necessary. These agents don’t work for Opendoor, but they do pay Opendoor a referral fee for the customers that Opendoor sends them.

Other Opendoor entities

Aside from instant cash offers, Opendoor now offers other real estate services like mortgage, realtor services, and title insurance.

Opendoor Home Loans

Opendoor Home Loans is Opendoor’s mortgage lending solution. As an Opendoor customer, you have the option (but not the obligation) to finance the purchase of your new home using Opendoor Home Loans.

The lender offers mortgages with competitive interest rates and does not charge any lender fees. Opendoor Home Loans also offer a $1,000 credit at closing, subject to eligibility.

Opendoor Brokerage

Opendoor’s brokerage can provide you with an Opendoor real estate agent who will represent you if you want to list your house for sale through Opendoor. This is similar to working with a real estate agent at a major brokerage as you would in a traditional sale.

However, Opendoor real estate agents cannot represent buyers who want to buy an Opendoor home as this would constitute a conflict of interest.

Opendoor Title

In 2019, Opendoor acquired OS National, a national title insurance company.[5]

As a result, Opendoor can now offer title insurance and escrow services to customers internally through Opendoor Title.

How does Opendoor make money?

Opendoor’s business model is to buy houses and make a thin profit margin from each home sale, plus the service fees they charge.

Opendoor’s service charge is capped at 5%. The company bases this charge on how long they expect it will take to sell the home on the open real estate market. Part of the fees go to cover costs of holding the home, like taxes, utilities, and maintenance.

Opendoor lays out their calculations for your home value and service charge for each offer in a report. The report details the price of comparable homes that have sold recently in your neighborhood. It also accounts for unique aspects of your home that could affect value, such as a finished basement, proximity to quality schools, and walkability to shopping or public transit.

The home assessment also includes repairs needed before Opendoor sells the house, and how the costs of these repairs will affect your offer.

Opendoor FAQs

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Contact Opendoor

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