What Opendoor's Success Means for Real Estate AgentsAug 12, 2021
Real estate is important to me. I manage 250 agents and a community of iBuyer certified REALTORS. The iRep community was built knowing that there is no playbook for the disruption we’re experiencing. It was created to help educate agents on bridging the gap between real estate and technology so that their clients don’t have to choose between using a company like Opendoor and an agent.
Opendoor Has Reached 100,000 Transactions
During a conversation with Will Holmes, General Manager of Opendoor's Partner program, we discussed that Opendoor has now transacted with 100,000 customers. That's a milestone for any agency, but especially for one as new as Opendoor.
Opendoor’s success shows a shift in consumer and agent perception and has us asking, “What does the shift mean for agents?” I believe there are five takeaways for our agent community to consider.
1. iBuyers Are Here To Stay
If the monumental growth Opendoor has experienced teaches us anything, it’s that iBuyers are here to stay. They are expanding their business model, markets, and opening doors to agents in new and exciting ways.
My willingness to embrace iBuyers didn't happen overnight. It took a solid year for me to shift from skepticism to acceptance. It was money, or rather the pain of losing money, that first turned my head. Second, the flow of capital. The reality was that iBuyers were winning deals and investors.
Once SoftBank Vision Fund threw its capital behind Opendoor, it was gloves off for me. Fighting iBuyers was no longer a wise choice. SoftBank is the world’s largest technology-focused venture capital fund. They have people on their team who are a heck of a lot smarter than I am, and they know something. I stopped asking myself how to beat the iBuyer and started asking, “How do I play?”
I stopped asking myself how to beat the iBuyer and started asking, “How do I play?”
2. Our Customers Want iBuyers
We must accept that Opendoor’s success proves that their model is something our clients have yearned for. Sadly, we either failed to recognize the need or chose to ignore it.
Remember, 100,000 people have already voted with their decision, and as Opendoor continues to expand into new markets, their growth will multiply exponentially.
As REALTORS, it has taken us too long to accept this reality, but it's not too late. Our clients have decided the traditional real estate process is not out of the question, but that another option is to be considered. Working alongside iBuyers means that your message to consumers can shift from "This is what I can do" to "This is what I can do, and I have a buyer for your house."
3. There’s Money to be Made
Ignoring iBuyers leaves money on the table.
When Opendoor first entered the Phoenix market, it was easy to brush them aside. At first, they sold a couple of houses, then it was hundreds, and now it’s thousands. When agents are willing to work with iBuyers, there’s money to be made.
Will shared that Opendoor has paid out over $300,000,000 in commissions to agents, and with the launch of their new Agent Access program, that number will continue to climb.
“Opendoor provides an edge to those who are willing to embrace it and provides unique ways to serve clients.” Will Holmes, Opendoor
4. Opendoor Isn’t a Threat to REALTORS
A mind that is looking for threat is a mind closed to opportunity.
Traveling around the country for iRep, I often mastermind with top agents. These agents are always looking for and trying to create opportunities. Top agents never look at potential as a threat. Instead, they look at it and ask, “How can I master this and leverage it into my business?”
When someone is committed to finding and creating opportunities, they figure out ways to be successful. In Will’s interaction with agents, he’s found that top agents are also radically open-minded, with a willingness to embrace change and sit on the cutting edge, knowing how to pivot slightly from their foundation toward what’s coming next.
Top agents are lifelong learners, embracing the Gary Keller philosophy of curiosity. How can we get curious and leverage the opportunity to work with iBuyers? Remember, there will always be winners and losers, but you can’t be a winner without taking risks.
5. There’s More Opportunity for REALTORS
Opendoor is a market creator. It doesn’t take inventory and hoard it off-market. It creates twice the amount of opportunity for real estate agents.
Let’s break it down this way: Say I’ve got a seller prospect. The seller decides that Opendoor is the best option for them. I connect them with Opendoor and get paid on that transaction. Opendoor then makes repairs to the property and puts it back on the market. I now have the opportunity as a market broker to represent a buyer to buy that same house, with an advantage. I know the house is coming to market, making it a semi-pocket listing, a true advantage in a market with limited inventory.
iBuyers Bring New Buyers and Sellers to the Market
iBuyers are also bringing clients to the market who would have generally been content to sit on the sidelines.
The traditional buying and selling process creates too much friction for some. iBuyers open the door for REALTORS to generate more wealth by presenting solutions for this subset of buyers and sellers.
I’m not saying iBuyers are the right solution for everyone. They are not. I am saying that there is a subset of buyers who are willing to pay for convenience. I’m one of them.
As a father of five-year-old triplets, the thought of preparing the house and keeping it in a state that allows a buyer to see its highest and best value is overwhelming. Knowing that Opendoor is an option, takes away that “stuck” feeling created by a lack of solution. Having the opportunity to move without friction feels like freedom.
My family’s reasoning is just one of many that might keep consumers off the market.
”iBuying allows REALTORS to bring these prospects off the sidelines and into the game.” Will Holmes, Opendoor
If we take anything away from Opendoor’s growth, it’s this: There are factors we might have previously deemed as trivial that are likely important to the consumer. Will’s advice to REALTORS is to be responsive, listen, and put consumers first. Our methods of transacting real estate are far from archaic, but that doesn’t mean there isn’t room to pivot toward greater personal success and client satisfaction.