1. This will be a hit with sellers who are not price-sensitive such as out of area heirs. What tiny percentage of the market is this? And it might work in AZ or NV where the inventory is miles of identical little boxes and you can convince sellers that there really is only one price.
2. Vulnerable people might fall for this model and then the lawsuits follow (I'm a consumer fraud attorney and a real estate broker, but what do I know?).
3. Smart agents and brokerages are already getting ahead of this trend and educating consumers about the limitations.
We're decades away from consumers being so cavalier about their biggest assets and their once or twice in a lifetime transactions. I started in real estate via tech. I had to learn the hard way that real estate is a trust and relationship business for a reason.
really appreciate your point about trust and relationship - that's what all businesses are about. that personal (in person) touch is key, although i would argue there are newer generations that equate online/apps in the same regard as in person (or better). it's an uber generation after all, and i've talked to many genZers who would prefer to purchase (even a home) via an app. the question is, do they have the funds to pull the trigger. maybe we're a decade away, but "decades" seems like a stretch. you absolutely know more than me in this area, though, so you have me rethinking the opportunity.
Thanks Tracy and TW! I agree on both things you mention Tracy - it's a 10 year bet and buying / selling a home is the most expensive decision one is making.
With taking a long horizon, I think it's a way to ride the stock as the behavior becomes normalized over the next 10 years.
this sounds really exciting! other than Zillow, who are their main competitors? i've also heard friends talk about EXP Realty and how they have disrupted the consumer real estate market. are they in the same space? i would agree that it's exciting to see this space move into the 21st century!
From a quick look at the website (1 min) seems that EXP realty changes the game for AGENTS (allows them to become equity holders in the brokerage/company) but not really for customers. And it is the customers who need the game change. Thoughts?
eh...good point, although the couple of folks (small sample size!) i know who are with EXP say that their online model and IP (virtual home selling) is the secret sauce that has empowered them, esp during the pandemic. so they appear to be enabling customers with online services (virtual tours, etc.), but one could argue that essentially all industries have gone through rapid digital transformation, esp this year. maybe the game changer would be for the customer to get some equity? the other concerning thing about their model is what appears to be an MLM, but i digress. the opendoor opportunity is interesting, but i'm not convinced it's a 10x play.
I agree Frances! I believe once you get confidence you won't lose money on a home, Opendoor will have more margin they can risk. The lower they make their commission, more they have a chance to monopolize
Three quick observations:
1. This will be a hit with sellers who are not price-sensitive such as out of area heirs. What tiny percentage of the market is this? And it might work in AZ or NV where the inventory is miles of identical little boxes and you can convince sellers that there really is only one price.
2. Vulnerable people might fall for this model and then the lawsuits follow (I'm a consumer fraud attorney and a real estate broker, but what do I know?).
3. Smart agents and brokerages are already getting ahead of this trend and educating consumers about the limitations.
We're decades away from consumers being so cavalier about their biggest assets and their once or twice in a lifetime transactions. I started in real estate via tech. I had to learn the hard way that real estate is a trust and relationship business for a reason.
really appreciate your point about trust and relationship - that's what all businesses are about. that personal (in person) touch is key, although i would argue there are newer generations that equate online/apps in the same regard as in person (or better). it's an uber generation after all, and i've talked to many genZers who would prefer to purchase (even a home) via an app. the question is, do they have the funds to pull the trigger. maybe we're a decade away, but "decades" seems like a stretch. you absolutely know more than me in this area, though, so you have me rethinking the opportunity.
My POV was hard won. Thanks for considering. 😁
Thanks Tracy and TW! I agree on both things you mention Tracy - it's a 10 year bet and buying / selling a home is the most expensive decision one is making.
With taking a long horizon, I think it's a way to ride the stock as the behavior becomes normalized over the next 10 years.
this sounds really exciting! other than Zillow, who are their main competitors? i've also heard friends talk about EXP Realty and how they have disrupted the consumer real estate market. are they in the same space? i would agree that it's exciting to see this space move into the 21st century!
From a quick look at the website (1 min) seems that EXP realty changes the game for AGENTS (allows them to become equity holders in the brokerage/company) but not really for customers. And it is the customers who need the game change. Thoughts?
eh...good point, although the couple of folks (small sample size!) i know who are with EXP say that their online model and IP (virtual home selling) is the secret sauce that has empowered them, esp during the pandemic. so they appear to be enabling customers with online services (virtual tours, etc.), but one could argue that essentially all industries have gone through rapid digital transformation, esp this year. maybe the game changer would be for the customer to get some equity? the other concerning thing about their model is what appears to be an MLM, but i digress. the opendoor opportunity is interesting, but i'm not convinced it's a 10x play.
Thanks for your points, Amanda and TW!
I'll have to look into EXP.
Why not reduce the commission vs keeping it the same. It would be way more attractive!
I agree Frances! I believe once you get confidence you won't lose money on a home, Opendoor will have more margin they can risk. The lower they make their commission, more they have a chance to monopolize