Triangle housing market is flattening out (Raleigh, Durham: days on market, neighborhoods, to live)

[MikeJaquish]

Originally Posted by wheelsup

My neighbor paid 4% with OpenDoor.

What did your neighbor pay for repairs dictated by OpenDoor?
And, what were those repairs?

[wheelsup]

Originally Posted by MikeJaquish

What did your neighbor pay for repairs dictated by OpenDoor?
And, what were those repairs?

According to him it was "very reasonable" but he didn't get into it. They actually came out ahead by being able to sell to OpenDoor as they then had a contract and could buy their next house they were building but continue to live in their current house for six months while they waited. The contract won't execute until they move out so it saves them six months rent plus moving etc along with associated mortgage pay down...it was an awesome deal.

Essentially what OpenDoor did was offer to buy their house in advance for a contracted price. Imagine the freedom that gives buyers who can't buy a second house without selling their current. I've now seen a local company offering the same thing, who knows how they compare though.

If you take their first offer just like anything you'll lose out. Their first offer on fees was 6% or 7%, he just kept saying no until they got reasonable. Also he said the comps they used were higher than he was expecting. I have no personal experience but the last few homes in my neighborhood have all been OpenDoor and they have sold fast.

[RedZin]

Originally Posted by wheelsup

My neighbor paid 4% with OpenDoor.

OpenDoor, last I checked, doesn't deal with homes over 500k in the Triangle, so there are still plenty of people who need realtor services of some sort.

[MikeJaquish]

Anecdotally, clearly we have folks who are satisfied with a deal.

I am more intrigued by the sustainability of the business model and their ability to churn their capital quickly enough to get profitable while pricing attractively.

One advantage agents have? They don't carry inventory and it is a capital-cheap business to be in.
Carrying inventory is a tremendous drag on a business and fun to consider regarding Open Door.
Agents can readily compete from a standpoint of fees and service, because they don't have to commoditize and homogenize every deal.

When OpenDoor gets their properties right, they close quickly.

Originally Posted by TarHeelNick

Opendoor listings DOM are significantly above average here for the most part. ...

When they miss, like Nick says, the inventory sits on the market.

I.e.,

Current Active inventory, 263 units, DOM/CDOM shows:
Average of 73 DOM. Average price: $298,446
Median of 56 DOM. Median price: $290,000
In a sellers market.

Current Pending/Contingent inventory, 141 units, DOM/CDOM shows:
Average of 47 DOM. Average price: $251,333
Median of 28 DOM. Median price: $245,000

Closed inventory, 445 units since 1/1/2018, DOM/CDOM shows:
Average of 26 DOM. Average sold price: $243,719
Median of 13 DOM. Median sold price: $231,000

Closed inventory, 358 units since August 1, DOM/CDOM shows:
Average of 29 DOM. Average sold price: $245,172
Median of 15 DOM. Median sold price: $232,850

It is fair on any of these to add at least 6 weeks, i.e., 42 days to get in and get out. The funds have to be booked and tied up.

If Open Door has $115,000,000 list price local inventory, and makes a few percent on each after expenses, the exposure, liability, effort, risk, etc would make me believe they need to churn 4-5 times a year to make it worthwhile.

[pierretong1991]

Is the government shutdown affecting the real estate market any?

[MikeJaquish]

Originally Posted by pierretong1991

Is the government shutdown affecting the real estate market any?

Not really.
It is just added craziness to the environment we have been living in, so maybe some folks will be leery of buying, but there really isn't much technical drag on the market due to federal employees not working.

[Grizzmeister]

I was driving in Franklin County near Youngsville and noticed a ton of new home construction. Sorta gave me the same vibe as what I witnessed up in Maryland just before the bottom fell out of the real-estate market around 2007. By that I mean houses that seem overpriced given the socioeconomics of the area. Guess only time will tell but I sense we're headed for a serious correction sooner rather later. Feels like we've been here before.

[NewWaveDad]

Went to an open house in Cary yesterday, 15 - 20 different parties there, realtors writing offers on site... why even bother trying to buy here.

[wheelsup]

Originally Posted by NewWaveDad

Went to an open house in Cary yesterday, 15 - 20 different parties there, realtors writing offers on site... why even bother trying to buy here.

I'm in the same boat, different market but very similar to Raleigh. I just dumped our down payment money earning peanuts into the stock market back right after Xmas. I figure I won't be buying for a while now. Oh well. I'll end up with more this way (hopefully!).

[DPK]

Originally Posted by NewWaveDad

Went to an open house in Cary yesterday, 15 - 20 different parties there, realtors writing offers on site... why even bother trying to buy here.

When we were looking about this time last year, we went to an open house in Cary for a development that had 140 lots go on the market at the open house. 80 of the lots were reserved with a deposit by the time we got there a few hours into it.

Utterly insane.