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Old 09-02-2021, 10:02 AM
 
9,196 posts, read 16,663,029 times
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Quote:
Originally Posted by MN-Born-n-Raised View Post
Here is the house I was referring to https://preview.mcassessor.maricopa..../?q=502-03-907 Opendoor was the buyer. They paid $711K which is high. It's just a lot of square footage. Nothing special IMO. See some internal pix https://www.realtor.com/realestatean...-35923#photo17 . I "think" those pix are from an earlier listing. I'd be interested to know (there was no pix online 2 weeks ago).

I'm confused about the fee. If the fee was 10%, then why didn't they buy it directly for $711K * .9 or $639.9K? Mind you, IMO, even at a top percentage of 10% and receiving $639.9K is good for the seller. I would have sold it in a heartbeat for that price. It's a 2 story with a lousy backyard in Surprise. But maybe I'm wrong.
What's their business model? Will they fix it up and flip it or rent it out? That house is a fugly monstrosity. I'm not sure how they plan to profit off of it.

 
Old 09-02-2021, 10:04 AM
 
4,624 posts, read 9,287,432 times
Reputation: 4983
Quote:
Originally Posted by MN-Born-n-Raised View Post
Here is the house I was referring to https://preview.mcassessor.maricopa..../?q=502-03-907 Opendoor was the buyer. They paid $711K which is high. It's just a lot of square footage. Nothing special IMO. See some internal pix https://www.realtor.com/realestatean...-35923#photo17 . I "think" those pix are from an earlier listing. I'd be interested to know (there was no pix online 2 weeks ago).

I'm confused about the fee. If the fee was 10%, then why didn't they buy it directly for $711K * .9 or $639.9K? Mind you, IMO, even at a top percentage of 10% and receiving $639.9K is good for the seller. I would have sold it in a heartbeat for that price. It's a 2 story with a lousy backyard in Surprise. But maybe I'm wrong.
I think they do it that way for a few reasons. First, I think it's good psychologically for the seller to be able to say "I sold for $700,000" rather than the net they received. Secondly, it's good for marketing for these home buying companies to say these sellers received market rate or close to it rather than the lower amount. The other thing that may be taken into account is the appraisal when these companies sell the properties on the open market.
 
Old 09-02-2021, 10:07 AM
 
4,624 posts, read 9,287,432 times
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Quote:
Originally Posted by DetroitN8V View Post
What's their business model? Will they fix it up and flip it or rent it out? That house is a fugly monstrosity. I'm not sure how they plan to profit off of it.
They clean the homes, sometimes paint and carpet, fix what's broken. Then they make the house really easy to show through their app with or without a realtor. They try to sell for a bit more than they paid and also profit from the fee at the time they obtain the property.
 
Old 09-02-2021, 10:12 AM
 
9,196 posts, read 16,663,029 times
Reputation: 11328
Quote:
Originally Posted by asufan View Post
They clean the homes, sometimes paint and carpet, fix what's broken. Then they make the house really easy to show through their app with or without a realtor. They try to sell for a bit more than they paid and also profit from the fee at the time they obtain the property.
Interesting. Can't imagine there's any meat left after even a quick paint job. I'll be interested to see when and where it comes back to market.
 
Old 09-02-2021, 10:20 AM
 
4,624 posts, read 9,287,432 times
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Quote:
Originally Posted by DetroitN8V View Post
Interesting. Can't imagine there's any meat left after even a quick paint job. I'll be interested to see when and where it comes back to market.
Like I said, they do screw up now and then, although I'm not privvy to what fee they received on each purchase. I imagine a lot of the employees finding these properties may be newish to the business.
 
Old 09-02-2021, 10:37 AM
 
9,797 posts, read 11,196,252 times
Reputation: 8509
Quote:
Originally Posted by asufan View Post
Like I said, they do screw up now and then, although I'm not privvy to what fee they received on each purchase. I imagine a lot of the employees finding these properties may be newish to the business.
Thanks for explaining. I thought of the reasons you mentioned on why they do that but wasn't sure. Plus, by having a higher artificial price, it "proves" they were not greedy when they re-spin it for just a little bit more. All too often, people remind others of what they paid when they quickly resell. When I was flipping properties on water (Canada, MN, and Mazatlan), I'd say: "Well, ff I found a $100 bill on the floor, should I sell it to you for $50?" It quickly aligns them.

Last edited by MN-Born-n-Raised; 09-02-2021 at 11:43 AM..
 
Old 09-02-2021, 11:23 AM
 
Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,641,380 times
Reputation: 9169
Quote:
Originally Posted by Sno0909 View Post
Schooled me? Lol...ok.

Firebird said we need more public housing. He has also claimed he has a household income of $120,000. You sure as hell aren't going to qualify for public housing in that tax bracket.

So my question was how is public housing going to help him, specifically, purchase a home?
I didn't say the public housing was for me specifically, again, you expand public housing, and it lowers demand for private housing, which drops prices
 
Old 09-02-2021, 11:49 AM
 
Location: Gilbert, AZ
1,695 posts, read 1,282,696 times
Reputation: 3705
Quote:
Originally Posted by FirebirdCamaro1220 View Post
I didn't say the public housing was for me specifically, again, you expand public housing, and it lowers demand for private housing, which drops prices
No, because anyone who would qualify for public housing, was never seriously in the real estate market to begin with. If you're trying to purchase a home, you aren't competing with those people. The people that want private housing is still the same pool of people.
 
Old 09-02-2021, 11:52 AM
 
9,797 posts, read 11,196,252 times
Reputation: 8509
Quote:
Originally Posted by DetroitN8V View Post
What's their business model? Will they fix it up and flip it or rent it out? That house is a fugly monstrosity. I'm not sure how they plan to profit off of it.
It's Surprise, AZ. Since that place is going to cost a fortune to cool including the TALL ceilings. Plus, that era had crappy windows (ask me how I know) and people in Surprise normally are on a budget. I predict the size will chase away a ton of buyers.

I think that one will be a mistake for them. But my friend said they came out more than once as he was laughing out loud. So it's not like they didn't study it. But my popcorn is popped. I predict a loss on that one. Why couldn't I find someone that reckless when I sold! lol
 
Old 09-02-2021, 11:55 AM
 
Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,641,380 times
Reputation: 9169
Quote:
Originally Posted by Sno0909 View Post
No, because anyone who would qualify for public housing, was never seriously in the real estate market to begin with. If you're trying to purchase a home, you aren't competing with those people. The people that want private housing is still the same pool of people.
You obviously don't understand the domino effect. When there is a lack of public housing, more people compete for private rentals, which drives rent up, which causes increased amounts of people who wanted to buy to have to continue renting because rent takes up enough of their income that they can't save.
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