What is Open Door?

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Have y’all heard of this?  Billboards are going up advertising it, and I had someone ask me about it recently.  Open Door is yet another real estate alternative that offers to buy your property from you, no fuss, no muss.  They also presume to offer you a “competitive price!”  Just sell it when you’re ready and be done with the whole thing! 

Sounds great, right?  I mean, who wants to deal with annoying, money-grubbing realtors, or with the never-ending task of getting your house ready to sell, or with pesky showings? 

This might sound good, but let’s investigate further…

Perhaps most telling, they don’t take “distressed listings.”  This is a clue that perhaps things aren’t as good as they sound.  In other words, they’re only going to take houses that are well-kept, desirable places to live, that people will pay a lot of money for.  They won’t buy your house if you’ve had trouble selling it in the past; if it’s been sitting on the market a long time. 

Hmmm…so, why won’t they take distressed listings?  Well folks, it’s because it’s just plain bad for business.  They’re in this to make money, obvs.  The way they do that is they buy your place and then go ahead and put it on the market, listed at what it should have been in the first place. 

This company also only operates in hot markets, another red flag.

I don’t know about you, but selling to Open Door sounds like a fantastic way to just toss your money out the window.  I mean, you could at least invite some friends over and have a great big bonfire with your money to roast marshmallows over if you were hell-bent on wasting it!  If you’re not sure what I’m talking about, lemme break it down:

The only properties they buy are properties that they know they can turn a profit on quickly in a hot market. 

Therefore, if they want to buy your property, that means almost certainly that you’re better off putting it on the market and letting buyers fight over it!    

It sounds like even if you did next to nothing to your house to get it ready for market, you’d come out far better than selling to this company.

Honestly, I’m not really sure who this company is appealing to, other than distressed people with nice, non-distressed homes.  It sounds to me like they’re taking advantage of people in hard times, which is just disappointing. 

I suppose they hook people by saying they’ll offer you a “competitive price,” but how competitive can it be if they’re in it to make some quick turn-around money?  They’re not working for free or doing this out of the goodness of their corporate heart.  I also worry about their claim that they show you what comps sold for in order to give you a “fair price.”  A lot of people–but not everyone–know that data can easily be manipulated.  Take out one or two comps, and they might build a convincing argument that 30k less than what it should be is a “fair” price!  

Bottom line: If they want to buy your house, it’s a clear sign that you can do better on the market! 

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