The email began; “thank you for signing up to Opendoor”. As you can probably guess, I did no such thing. But it was the title of the email I found particularly odd, in an evil sort of way. “Provide the Ultimate Client Experience with Opendoor!”
Yes, it’s the same Opendoor who recently settled with the Federal Trade Commission (FTC) for their part in ripping-off naïve homeowners. Opendoor was ordered to pay $62M dollars to settle claims they misled sellers. The same week their ordered settlement was becoming common knowledge, Kerry Melcher, Head of Opendoor Sales & Brokerage sent out a blast email to millions of sales agents touting Opendoor as providing the “Ultimate Client Experience”. Opendoor just admitted they cheated their customers, to the tune of $62 million dollars, and now they are calling it the “ultimate client experience”. Balls!
Let’s review the FTC’s Enforcement Action. Opendoor has agreed to:
- Payback $62 million dollars
- Stop deceiving potential home sellers: The order prohibits Opendoor from making deceptive, false, and unsubstantiated claims. (This will hurt, it’s kinda their thing)
- Stop making baseless claims: The order requires Opendoor to have competent and reliable evidence to support any representations made about the costs, savings, or financial benefit.
At one time Opendoor promised to revolutionize the real estate market. But as Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, notes; “There is nothing innovative about cheating consumers”. In the olden days when companies were openly humiliated, they would publicly, “go dark” or lay low for a while. In today’s world, we simply change the narrative to whatever we want. Ours is a shame-free society.
Something to look forward to: a formal “Enforcement Action” also carries the force of law with respect to future actions. Meaning going forward every time Opendoor makes wild or misleading claims, it can result in a civil penalty of up to $46,517 per instance. Ching, Ching!
How does Opendoor go forward? According to Kerry Melcher’s agent email, “your local expertise coupled with our innovative technologies create an unbeatable experience for your customers”. Put aside the fact you’re feeding your clients to the wolves and note the comment; “innovative technologies”. $46 thousand dollars please.
Wasn’t Opendoor’s problem with the FTC built on the fact they had no innovative technology? And when asked about it, they couldn’t produce any. Yes, they use technology. But, it’s the same technology everyone else has. Spam email, innovative? Have you heard of excel?
A couple of years ago we wrote a blog telling agents to stay away from Opendoor. https://wyndrealty.com/trail-of-tears/ We were quickly bombarded with “how dare you”! At that time, we received many wonderful endorsements of the Opendoor process. In hindsight, it was probably the Opendoor Social team trolling the Internet. (We’ll never know)
While we have never been fans of Opendoor, we acknowledge their niche. Sellers with no skin in the game and no equity who simply want out from under. Taking advantage of people in trouble and then calling yourself a hero for it is what Opendoor does. Balls of steal! And sadly, as housing inventory continues to tighten, their niche of “buyers needing something in a hurry” will continue to grow with an added sense of urgency. Be very careful!
Do you want to know the “real” value-add to the Opendoor process?
Perfume on a pig. They’re the masters of it. They earn their living by making cheap look just a little bit better. Their mission is to spend as little as possible using only the cheapest available products. Applying the thinnest waft of perfume possible is what Opendoor brings to the table.
Ask yourself, how is that a trait you want to introduce to your clients?