Redfin and Opendoor Partner to Change Homebuying
Redfin’s latest headlining news is partnering with Opendoor, an online company that allows consumers to buy and sell without an agent, to further expand their own instant offer services. Currently launched in two cities, Phoenix and Atlanta, homeowners can get an instant cash offer on their home. The buyer? Opendoor. With the partnering, Redfin’s RedfinNow will give buyers and sellers more options.
As some may remember, Redfin had tried to launch something similar in 2006 called Redfin Direct. Redfin Direct allowed buyers to make offers online directly to the seller without using an agent. This model didn’t work, causing havoc with buyers and sellers alike. Redfin shelved the idea, waiting for the right moment to bring it back.
Rebranded as RedfinNow, Redfin allows buyers to easily make an offer utilizing the “buy it now” button. From there, buyers are coached on how to write an offer and given the power to negotiate with the seller.
Opendoor, founded in 2014, operates in 20 cities. Opendoor allows home sellers to sell their home with an instant cash offer. Sellers have the power to make their own repairs and choose their own closing date. For buyers, they can easily view any Opendoor owned homes with the use of their app. When they find a home they like, buyers can put together an offer and have an Opendoor home advisor to help guide them. Opendoor is looking to expand to 50 cities by the end of 2020.
This partnership has allowed both companies to expand into cities where their respective online buying was not available and melds the best of both companies. Analysts believe this partnership is in response to Zillow’s foray into the online buyers’ market. This market of online buyers, dubbed iBuyers, has been steadily rising since Redfin’s first introduction of it in 2006. Zillow Offers, currently operating in Phoenix and Atlanta - coincidence anyone? – follows the same process as RedfinNow and Opendoor.
Only time will tell if these online buyers will kick off on a larger scale. If this partnership is any indication, we may start to see an influx of iBuyers nationally, maybe in our own backyard. However, I strongly believe homebuyers out there need to be protected and guided by a licensed agent. Nothing can compete with a real live person who can and will answer your questions at any time of day and provide insight into the market.