Opendoor Reviews: What Is It and How It Works

Published on April 16th, 2024
15 min read

Richard Haddad Executive Editor
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Richard Haddad Executive Editor

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Richard Haddad is the executive editor of HomeLight.com. He works with an experienced content team that oversees the company’s blog featuring in-depth articles about the home buying and selling process, homeownership news, home care and design tips, and related real estate trends. Previously, he served as an editor and content producer for World Company, Gannett, and Western News & Info, where he also served as news director and director of internet operations.

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When you think of selling your home, you may imagine lengthy preparations, repairs, strangers in your house, price haggling, waiting, worrying, and trying to time the sale with a move. To bypass all these, many homeowners turn to new solutions offered by companies like Opendoor. But what is Opendoor? How does Opendoor work?

In this post, we’ll walk through the process of selling your home to this pioneering business, share Opendoor reviews, and provide a list of similar companies so you can compare your options and decide if a simple cash-offer home sale is right for you.

Editor’s note: The specifics of house-buying programs listed below can frequently change. Please visit the company’s website for the most up-to-date information.

What is Opendoor?

Opendoor is a tech-driven real estate company that helped launch the era of iBuyers (instant buyers), companies that provide near-instant all-cash offers to buy your home. Founded in 2014, Opendoor can provide a fast, seamless way to sell your home without the traditional hassles of listings, showings, and uncertain closing dates.

At its core, Opendoor provides homeowners with a direct path to sell their houses quickly by making an almost immediate cash offer. This approach caters to those looking for a straightforward, efficient transaction, emphasizing convenience and speed.

How does Opendoor work?

The process of selling your home to Opendoor is streamlined to ensure ease and efficiency. Here’s a brief rundown of how it works:

Submit your home details: You start by providing detailed information about your home on Opendoor’s website. In the next section, we’ll provide an overview of the questions you can expect.
Receive an offer: Opendoor evaluates the information you’ve provided, along with local market trends and comparable sales, to make an initial cash offer for your home. This offer is typically made within 48 hours.
Choose your closing date: If you accept Opendoor’s offer, you have the flexibility to choose a closing date that works for you, anywhere from a few days to a few months away.
Inspection and adjustments: Opendoor will conduct a home assessment to verify the condition of your property. If new information arises or any repairs are needed, they might adjust the offer price accordingly, or you may choose to make the repairs or changes yourself.
Close the sale: Once everything is agreed upon, the sale closes on your chosen date, and Opendoor handles the paperwork. You receive your payment, and Opendoor takes possession of the home.

What questions will Opendoor ask about my home?

When requesting an offer through Opendoor’s online questionnaire, you’ll first be asked to enter your home’s address. Then the automated platform will ask you to confirm or provide details about your property and selling plans. The order and nature of the questions will look similar to this:

Number of bedrooms
Full and partial bathrooms
Square footage (above ground)
Floors (above ground)
Whether you have a basement
Year built
Pool or other amenities
Garage or carport
Kitchen countertops
Describe each room (fixer-upper, dated, standard, high end, luxury)
Describe the home’s exterior
If your home is in an HOA, a gated or age-restricted community
Other details such as solar panels, foundation issues, fire or water damage, septic system, asbestos siding, horse property, mobile or manufactured home
Selling timeline (ASAP, 2-4 weeks, 4-6 weeks, 6+ weeks, just browsing)

At the end of the questionnaire, a prompt will appear saying, “See your estimated offer right away.“ To continue, you’ll be required to create an account, which can be done with Google, Facebook, or your email address.

How does Opendoor estimate its cash offer?

Opendoor’s cash offer is calculated through a combination of advanced technology and real estate expertise. At the heart of its process is a sophisticated algorithm that analyzes data points across multiple factors to help ensure a fair and competitive offer.

To make an offer on your home, Opendoor primarily relies on three things:

The information you provide about your home’s condition, features, and updates
A robust data model of market trends and recently sold homes
Opendoor’s team of experienced local pricing and property assessment experts

On its website, the company provides this clarifying statement: “We don’t try to make ‘low ball offers’ because, unlike a home flipper, our business model isn’t based on buying low and selling high. The way we make money is by charging a fee for our service.”

This approach aims to balance speed and convenience with fairness, providing sellers with a viable cash offer option.

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What kind of homes does Opendoor buy?

Opendoor is flexible regarding the types of homes it purchases, with a few guidelines to ensure the properties fit its business model. Typically, Opendoor buys:

Single-family homes: The most common type of property Opendoor purchases.
Townhouses and condos: Depending on the location, these are also considered along with duplexes.
Homes within a certain price range: Opendoor generally buys homes in the market value range of $100,000- $600,000, but depending on the market, it will go up to $1.4 million in some cases.
Homes in markets where Opendoor operates: Opendoor doesn’t buy everywhere; their service areas are focused in certain states and cities. See the service area section below.
Homes built after a certain year: To minimize the risk of significant structural issues, Opendoor usually purchases homes built after 1930, but this can vary by location and property.
Homes within a certain lot size: In most areas, Opendoor seeks homes on a maximum lot size of 2 acres. In some areas, the maximum lot size is limited to 1–1.5 acres.

Are there homes Opendoor won’t buy?

Depending on the location, Opendoor will sometimes purchase homes in age-restricted and gated communities. However, the company cites a list of homes that they won’t normally buy. These include:

Property being sold as a short sale or foreclosure
Homes with un-permitted additions
Homes with significant foundation issues
Homes with fire, flood, or natural disaster damage
Homes built within a flood zone
Homes with dated materials (masonite woodruff roofs, polybutylene plumbing)
Homes with a well water source or septic system
Homes that show signs of active organic growth, such as mold

Does Opendoor buy homes in my area?

Opendoor operates in over 50 markets in 26 states, plus the District of Columbia. The company focuses on metropolitan and suburban areas where the real estate market is active, and data on home sales are abundant.

To find out if Opendoor buys homes in your area, visit this link or go to the landing page on their website and input your home’s address. Opendoor continuously expands its service areas, so even if it doesn’t currently operate in your state, it may do so in the future.

Location not available message: After entering your address, you might see a message that says: “Sorry, we’re not available in your area yet. We can’t make an offer today for [your address].” If this happens, you can enter your contact info to request a notification when and if the company has expanded into your area.

What is the cost of using Opendoor?

Selling to Opendoor involves certain costs, which are transparently outlined to sellers. These include:

Service charge: Opendoor charges a service fee, which is a percentage of the sale price. This fee is typically around 5%, similar to what an agent might charge in commissions. For example, on a $400,000 home, the fee would be $20,000.
Repair costs: If the inspection reveals issues that need fixing, Opendoor may adjust its initial offer to account for these repairs. Sellers can choose to undertake repairs themselves, but this might affect the timeline and convenience factor.
Closing costs: Similar to traditional real estate transactions, sellers are responsible for certain closing costs, which typically run about 1% of the sale price. However, these are often lower than the traditional model, as there’s no need for a seller’s agent.

Does Opendoor negotiate its purchase offers?

Opendoor says it strives to be meticulous in its offer process, but its pricing team also wants to be certain they’ve considered all the features that make your home unique. If you think they’ve missed something, they will negotiate your purchase offer.

The company sends counteroffers by email and is open to negotiating through email or phone until a fitting agreement is reached. Depending on the other terms of the agreement, the company will also sometimes negotiate closing costs.

It’s important to remember that Opendoor’s off-market pricing structure is designed to prioritize convenience and speed, aiming to make the selling process as smooth as possible for homeowners. Sellers must keep this in mind when comparing the purchase prices of homes sold on the open market.

Does Opendoor sell the homes it buys?

Yes, Opendoor sells the homes it buys. After purchasing a house, Opendoor may make necessary repairs or improvements to ensure the property meets its standards for sale. Once ready, these homes are listed for sale on Opendoor’s platform and other real estate listings sites.

The company provides potential buyers with detailed online listings, virtual self-tours, and the option to visit homes on your schedule. Buying directly from Opendoor allows you to skip the traditional bidding and negotiating process and pay one simple price. You can submit an offer online. If you change your mind before closing, the company will return all your earnest money deposit.

List option: Opendoor can also list your home for you so you can start your own traditional selling journey with an offer in hand. When you list with the company, Opendoor offers are typically good for 60 days. If the offer expires, you can request a new offer through their website and start the process again.

Opendoor reviews

When considering Opendoor, it’s essential to explore reviews from previous customers. Positive reviews often highlight the convenience, speed, and simplicity of the Opendoor process, which are significant advantages for sellers looking for a quick and hassle-free sale.

However, some reviews point out concerns over offer prices, which can be below market value, and the cost associated with the service fee and repairs. Some negative buyer reviews have surfaced regarding the workmanship of repairs made on Opendoor properties sold through their website. As with any service, experiences can vary, and it’s prudent to check reviews on multiple platforms.

Opendoor’s Better Business Bureau profile shows it holds an overall A rating, but it only has an average of 1.12 out of 5 stars from 233 BBB customer reviews.
Opendoor’s Google customer review ranking is slightly higher, with 1.4 out of 5 stars from 47 reviews.
Opendoor’s self-hosted review page features numerous 5-star ratings and customer testimonials.

Pros and cons of using Opendoor

Pros

Convenience: Selling to Opendoor eliminates the need for listings, showings, and waiting for a buyer, making it a convenient option for those looking to sell quickly.
Speed: Offers are made quickly, often within days, and sellers can choose their closing date, facilitating a faster transaction.
Certainty: The process removes many uncertainties associated with selling a home, providing sellers with a clear timeline and offer.

Cons

Cost: While eliminating traditional selling costs, Opendoor’s service fee, and potential deductions for repairs, can accumulate, possibly resulting in a higher cost than expected.
Offer prices: Offers might be below the market value to cover Opendoor’s operational risks and costs, which could be a downside for those looking to maximize their sale price.
Availability: Opendoor’s services are not available in all areas, limiting options for some sellers.

Alternatives to Opendoor

Below is a list of additional companies that provide cash offers for homes. Most house-buying companies provide no-obligation cash offers, which means investigating hoemowners can request and compare multiple offers without a signed commitment.

We’ll provide links to each company website and service location area. As with Opendoor, you should check current terms, fees, and customer reviews for any company you think might be a good fit for your situation.

Offerpad: Operates similarly to Opendoor, providing homeowners with a quick and easy way to sell their homes for cash. Services are available in 14 states, including Arizona, Colorado, Florida, Georgia, Illinois, Indiana, Kansas, Missouri, Nevada, North Carolina, Ohio, South Carolina, Tennessee, and Texas.
Simple Sale: A solution from HomeLight, Simple Sale connects you with the largest network of cash buyers in the country. With Simple Sale, you can get a no-obligation all-cash offer in 24 hours, and close your home sale in as little as 10 days. Services are available throughout most of the nation — input your address to see if Simple Sale provides cash offers in your area. HomeLight also offers an innovative Buy Before You Sell program.
We Buy Houses: This well-known house-buying company offers a license to its marketing and branding programs for professional real estate investors looking to buy, repair, and flip homes. Services are available in over 200 markets in more than 30 states.
Clever Offers: While its core service is helping people find real estate agents, it also hosts Clever Offers, a home-buying platform that pairs sellers with local investors. Services are available in all 50 states and the District of Columbia.
EasyKnock: While not a traditional iBuyer, EasyKnock offers a “Sell & Stay” sale-leaseback option, allowing you to sell your home to access its equity and then lease it back. There’s also a rent/repurchase program. Programs are available in most states but not offered in California, Delaware, Massachusetts, Maryland, North Dakota, New York, South Dakota, Vermont, and Washington.
HomeGo: Receive a no-obligation cash offer to buy your house and close in as little as 7 days. HomeGo takes pride in on-the-spot offers. Services are available in key metro markets in 23 states.
Knock: Provides bridge loans and other creative financing options that allow you to use your current home’s equity to buy a new house. Services are available in select housing markets in 19 states.
Homeward: Get a cash offer, buy before you sell, or get help making a cash offer. Services are available in select markets in Washington, Oregon, Colorado, Arizona, Texas, Tennessee, Maryland, Virginia, North Carolina, South Carolina, Georgia, and Florida, and coming soon to California.
Orchard: Specializes in helping you buy your next home before selling your current one. Services are available in select markets in Texas, Arizona, Colorado, Georgia, North Carolina, Maryland, Oregon, Virginia, and Washington.
Keller Offers: Offers a direct buying service from one of the world’s largest realty brands. Services are available in select markets in Atlanta, Georgia, Texas, Nevada, Florida, Arizona, North Carolina, and Alabama.
Mark Spain: Known for cash offers, personalized service, and local market expertise. Services are available in select markets in Texas, Tennessee, North Carolina, South Carolina, Alabama, Georgia, and Florida.
Flyhomes: Focuses on buy-before-you-sell and making you a cash buyer for your next home, increasing your buying power. Services are available in select markets in Washington, California, Oregon, Massachusetts, Texas, and Colorado.
Sundae: Targets homes that need work, offering cash deals without requiring repairs. Services are available in select markets in California and Texas.
ExpressOffers: Connects sellers with a network of investors for quick, competitive offers. Services are available in select markets in Ohio and Florida.

An image of two people working with laptops that represents working with a home investor

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How does HomeLight Simple Sale work?

Simple Sale is an all-cash offer platform created by HomeLight. It takes the stress and uncertainty out of selling your home. It’s a fast, free, and trusted online tool that provides a competitive, no-obligation cash offer to buy your home. Simple Sale also compares your cash offer amount with an estimation of what you would likely receive if you decide to list your home on the market instead.

Here is the easy 3-step Simple Sale process:

As an added value, Simple Sale also recommends top-rated real estate agents in your area based on transaction data and customer reviews. The platform shows you which agents sell the most homes in your market and price range so you can make an informed decision about whether to list with a top agent or sell to a house-buying company.

HomeLight’s Simple Sale platform can provide cash offers for homes nearly anywhere in the U.S. and in almost any condition. You can close your sale in as little as 10 days.

Simple Sale testimonial

“Thanks to HomeLight, I was able to sell my home quickly and without any hassle. I was very skeptical at first because of all the many ‘we buy houses for cash’ [companies] that are out there nowadays, but I am thankful that I decided to give them a try. I didn’t need to do any repairs, and we closed on my timeline. This was the absolute best decision that I could have made. Thank you HomeLight, and I will recommend you to my family and friends.” — Karen S. from Olive Branch, Mississippi

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Which home-selling option is best for me?

Deciding on the best way to sell your home depends on your priorities. If speed and convenience top your list, iBuying companies like Opendoor offer a compelling solution. They eliminate the unpredictability of traditional sales, providing a fast, direct path to selling your home.

However, if maximizing your sale price is your primary goal, the traditional route — hiring a real estate agent and listing your property — might be more suitable, despite its longer timelines and possible uncertainties.

Whether it’s the streamlined efficiency of a near-instant cash offer or the traditional real estate market’s potential for higher offers, at HomeLight, we’re happy to lend a guiding hand in navigating your real estate journey. Let us help you make an informed and confident decision, whether you’re looking for a no-obligation cash offer through a trusted platform like Simple Sale or seeking to consult with a top agent.

Header Image Source: (Paul Hanaoka/Unsplash)

At HomeLight, our vision is a world where every real estate transaction is simple, certain, and satisfying. Therefore, we promote strict editorial integrity in each of our posts.

Richard Haddad

Executive Editor

Richard Haddad is the executive editor of HomeLight.com. He works with an experienced content team that oversees the company’s blog featuring in-depth articles about the home buying and selling process, homeownership news, home care and design tips, and related real estate trends. Previously, he served as an editor and content producer for World Company, Gannett, and Western News & Info, where he also served as news director and director of internet operations.