________________________________________________ 

________________________________________________ 

192-3191 

UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

COMMISSIONERS: Lina M. Khan, Chair 

Noah Joshua Phillips 

Rebecca Kelly Slaughter 

Christine S. Wilson 

Alvaro M. Bedoya 

In the Matter of 

OPENDOOR LABS INC., a corporation, DOCKET NO. 

COMPLAINT 

The Federal Trade Commission, having reason to believe that Opendoor Labs Inc., a 

corporation (“Respondent”), has violated the provisions of the Federal Trade Commission Act, 

and it appearing to the Commission that this proceeding is in the public interest, alleges: 

1. Respondent Opendoor Labs Inc. (“Opendoor”) is a Delaware corporation with its 

principal place of business at 410 North Scottsdale Road, Suite 1600, Tempe, AZ 85281. 

2. The acts and practices of Respondent alleged in this complaint have been in or affecting 

commerce, as “commerce” is defined in Section 4 of the Federal Trade Commission Act. 

3. Respondent Opendoor operates an online real estate business that, among other things, 

buys homes directly from consumers as an alternative to sales on the open market or, as the 

company describes them, “traditional sales.” Opendoor promised consumers that they would 

make more money selling their homes to it than by selling on the market. In fact, consumers who 

sold to Opendoor lost thousands compared to what they would have received from a market sale. 

Opendoor Promised that Consumers Would Make More by Selling Their Homes to It. 

4. Respondent advertised to consumers an “iBuyer” real estate service that directly 

purchases consumers’ homes. Opendoor told consumers that, rather than making money from 

“buying low and selling high,” the company made money from a fee or “service charge,” which 

ranged from 6 to 14 percent of Opendoor’s offer price. Opendoor promised to use cutting-edge 

technology to save consumers money if they sold their homes to it by providing “market-value” 

offers and reducing transaction costs. Indeed, Opendoor provided consumers selling their homes 

with a chart comparing the consumers’ projected net proceeds from selling to it versus selling 

“traditionally” by listing on the market. These charts almost always projected that consumers 

would receive thousands more by selling to Opendoor, even accounting for Opendoor’s 
 

 

 

 

 

■ 

ffl Opendoor a Sponsored· 0 

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Get a fair mar1<et offer on your home without ever listing. Sell to 

Opendoor for a certain sale with no risk of financing fall-through. 

Opcndoor 

OPEN DOOR.COM 

No showings, cleaning, or listing necessary. 

Opendoor buys quality homes valued between $1 OOK ... 

0pendoorO @Opendoor · Feb 23, 2016 

Get Offer 

V 

Look, simpler pricing! Now better for more sellers. As always, your offer is 

our best estimate of full market value. 

Pricing & Fees I Opendoor 

Learn about Opendoor's pricing and fees. Our goal is 

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6' opendoor.com 

substantial fee. In fact, the vast majority of consumers who sold to Opendoor lost thousands 

compared to what they would have realized in net proceeds from selling on the market because 

Opendoor’s offers have been below market value on average and its costs have been significantly 

higher than what consumers typically pay. 

5. Opendoor designed its marketing to convince consumers that they would make more 

money selling their homes to it. Opendoor’s advertising and website promised “fair market” or 

“market value” offers with lower costs. When consumers requested an offer, Opendoor provided 

a multi-page document claiming to provide a market-value offer and a custom chart comparing 

the net proceeds the consumer should expect from selling to Opendoor versus on the market. For 

more than percent of consumers who received these comparisons and sold to Opendoor, the 

comparisons projected that the consumers would realize more in net proceeds selling to 

Opendoor. 

Opendoor Promised Consumers “Market Value” for Their Homes. 

6. Respondent advertised its home-buying service by claiming that Opendoor made “fair 

market” or “market value” offers. For example, on Facebook, Opendoor claimed that it allows 

consumers to “[g]et a fair market offer on [their] home without ever listing.” 

7. Opendoor similarly claimed on social media that its offers represent “our best estimate of 

full market value”: 

2 
 

 

 

 

 

 

 

 

 

 

8. Opendoor’s mail advertisements encouraged consumers to request offers from Opendoor 

to find out “how much [their] home is worth” and claimed that: 

Until now, there hasn’t been a fast and simple way to check on the true market 

value of your home. At opendoor.com you can see how much your home is worth 

in minutes. Our [local] real estate experts use market data and an assessment of 

comparable homes near you to prepare your home price. 

Other mail advertisements represented that Opendoor “aim[s] to make a competitive, fair market 

offer on your home using the most current data.” 

9. An Opendoor video ad similarly represented that consumers who go through the process 

of selling their homes on the open market could get “the same offer from Opendoor” without 

ever listing. 

10. Opendoor’s ads encouraged consumers to visit opendoor.com to request an offer. The 

website represented that Opendoor “aim[s] to offer fair market value for your home and take a 

service charge that enables us to provide world-class service from offer to closing.” It further 

claimed that Opendoor does not make money from a “buy-low, sell-high” strategy. Similarly, if 

consumers called Opendoor for more information, its call scripts instructed phone representatives 

to say that “Opendoor only makes a small amount on each sale.” 

11. A video on Opendoor’s website further explained that it uses home-sales data, “local real 

estate experts,” and sophisticated technology to provide “market value” offers: 

Every Opendoor offer relies on our robust data model that analyzes thousands of 

recent home sales in your market, as well as insights from our teams of local real 

estate experts. 

12. The website has also encouraged consumers planning to list on the market to request an 

Opendoor offer to learn their “home’s value” because it has “a deep understanding of market 

conditions and trends.” Respondent has specifically represented that Opendoor’s calculation of 

“home value” “is an estimation of what your home is worth. Also referred to as fair market 

value, it’s the price that a willing and informed buyer and a willing and informed seller can agree 

on.” 

13. Opendoor also sent emails promising a “competitive market price” and stating, “You 

deserve nothing less than what your home is worth.” 

Opendoor Promised to Provide Lower Costs than Traditional Sales. 

14. Opendoor’s advertising invited consumers to compare Opendoor’s costs to costs 

associated with selling on the open market. For example, it ran the following ads on Facebook 

and Twitter, respectively: 

3 
 

 

 

II\ Opendoor 

~ PubUshed by o Mavis Huang (?I · March 12, 2018 · 0 

Selling a home on the market often costs more than the 6% commission 

fees. When you sell to Opendoor, we estimate the entire cost upfront so 

you'll have a better sense of your net: proceeds. See how our costs 

compare to a traditional sale: http://bit.ly/2f06dhd 

t Realto,'s oommissions (6") 

2. Stag.ing and home p,eparation costs ( .. 1%) 

3. Seller concessions (1.5% - 2%) 

4, Repair oosts (detennined basod on i nspeccion} 

5. Home ownership and overl.'lp CO$tS ( 1%) 

6.Closlng 00Sl$( .. 1%) 

0pendoorO @Opendoor · Mar 12, 2018 v 

Selling a home on the market often costs more than the 6% commission 

fees. When you sell to Opendoor, we estimate the entire cost upfront so 

you'll have a better sense ot your net proceeds. see how our costs 

corrpare to a traditional sale: bit.ly/2f06dhd 

1, Rltaltor'• COO!tl'lmk>ot (6') 

2. ~te,glng andhom&preparation COllS{•I~) 

3. S.lftf ~ (1.S~ - 2") 

4. f,epalr cons (det8fffllned based on lnSpeetlorl! 

S. Momo own-hip •rd oo.•rltip cecu: (Hit) 

6. aos.1ng oo~ts H~) 

15. Opendoor’s website similarly claimed that its purported lower cost structure allows it to 

provide more net proceeds than what consumers would obtain from a traditional sale: 

A common misconception is that you won’t sell your home for top-dollar because 

our fee is higher than agent commissions. When you consider the cost savings we 

outlined above and the full range of services we provide, your net proceeds can be 

higher with Opendoor. 

16. Opendoor expressly claimed that its only source of profit is from its fee, which generally 

ranged from six to fourteen percent of the offer price. Opendoor’s website represented that the 

4 
 

 

 

 

 

 

 

Repair Items 

Like most buyers, Opendoor will assess your home to identify if any 

repairs are needed. After we buy your home, we'll make repairs so 

that the home is move-in ready for the next buyers. 

Our philosophy is to ask for repairs we anticipate the next buyer of 

the home will ask for. We look for items that are broken, in poor 

condition, or can affect the safety, structure, or functionality of the 

home. 

This list is not exhausuve-. but can give an OYeMew of the typeS of repa11s ~ may ask for. 

---

fee mostly consisted of costs that Opendoor anticipates paying to resell the home and that its 

profit was only “1% of our total service charge,” and an “amount we collect for providing a 

stress-free experience.” On a page titled, “How Opendoor calculates the value of your home,” 

the website explained, 

We don’t try to make “low ball offers” because, unlike a home flipper, our 

business model isn’t based on buying low and selling high. The way we make 

money is by charging a fee for our service. 

17. Opendoor’s website represented that it may require that the consumer make or pay for 

repairs Opendoor identifies after an in-person assessment of the property. However, the website 

also claimed that Opendoor merely requests the same repairs that consumers would otherwise 

have to make or pay for in a traditional sale. As shown in the image below, Opendoor has stated 

that it “ask[s] for the repairs we anticipate the next buyer of the home will ask for.” 

18. Opendoor’s website described the repair process as designed “to make sure the house is 

safe and functional” and not designed “to uncover every deficiency in your home to lower the 

offer.” Opendoor further represented that consumers may even save money on repairs if they sell 

to it because “we do our best to pass wholesale savings on to you from our partnerships with 

local vendors.” 

19. Opendoor also sent emails assuring potential consumers that the company’s “goal is not 

to make money from repairs—in fact, we pass any discounts from our vendors directly to you.” 

20. To illustrate the likely savings from selling to Opendoor, its website used its “home sale 

calculator” and a home with a $200,000 market value to demonstrate that consumers who choose 

Opendoor would save an estimated $4,400 over the costs of traditional sales: 

5 
 

 

 

pnee (example) 

Selling process 

Average days to close transact on 

Average deys to prep and su19e home 

Average num~r of show ngs 

Transaction costs 

Average ()penc:loor $erve.e charge 

Estimaied real estate agent fees 

Estimated $eUer eo~iOM 

Est11T-.ated home owne.rsh p and overlap 

Repa rs needed to sell home 

Estimated cash before closing 

Selling to Opendoor 

6.8% 

average service charge• 

$200,000 

Choose from 14·60 days 

0 days 

0 showings 

6.8% 

TBD 

$186,400 

Traditional home sale 

7-10% average costs• 

$200,000 

50 days 

10 days 

10 showings 

6% 

2% 

1% 

TBD 

$182,000 

Opendoor Promised that Consumers Will Make Money Selling to It. 

21. To request an offer from Opendoor, consumers enter details about their homes into an 

online portal. Unless the homes fall into categories for which Opendoor will not make offers, 

such as homes built before 1960, Opendoor calculates a custom offer and fee amount. 

22. Opendoor emails consumers a link with a customized offer within a few days. As shown 

in the sample email below, until at least 2019, the emails have stated that Opendoor has “just 

finished analyzing your home’s market value, and we’re excited to make you an offer!” The 

emails have also promised that accepting the offer allows consumers to “[g]et full value without 

paying the many hidden costs of a traditional sale.” Some versions of the email have claimed that 

Opendoor “strive[s] to give market value offers.” 

6 
HI Rober1, 

We just hnlshed analyz.lng your homo's maiket vMJe, and we're excited 10 make you an offe11 

I'm- and I'm here to answer any questions about your offer and how Opendoor 

\\000. 

Take e look end let me kno'N what you think: 

i\@+11 

You're able to: 

, Choose when you move, 3 to 60 days from rrow. 

• Skip intrusive and inoonwnient homo shoYMO,S. 

Get fun valuo wlth0u1 paying tl)e rr.nny hoden <mt, o• ft !rt)Q t,oootMio. 

23. Consumers who clicked the link in the email were taken to a series ofwebpages 

presenting the offer ("seller flow"). Until at least 2019, the first page of the seller flow 

represented that Opendoor's calculation ofhome value was ''based on recent sales in your area," 

and that its repair and closing costs were "similar to what you'd expect to pay traditionally." 

Hi Teresa, thanks for choosing us. Here's what's 

in your offer 

Home Value 

Estimated based on recent sale~ in your area 

Service Charge 

We'll compare this with the cost of selling traditionally 

% Repair and closing costs 

Similar to what you'd expect to pay traditionally 

Net proceeds 

Our besL estimate of the cash you'll receive at close 

24. The seller flow presented a housing-market analysis and a list ofrecent home sales on 

which Opendoor relied in calculating the offer. The seller flow described its estimate of "home 

value" as "based on comparable home sales and adjusting for differences like square footage, 

age, features, and location." The seller flow explained that "home value does not include costs 

associated with selling, such as repair costs." 

7 
 

days to firld ■ blJ"llllef' e 

Average days 10 dose transacbon • 

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£stimat ed net proceeds 

Odays 

Choose from 3-60 days 

Oshow1ngs 

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so 

Traditional home sale 

5Bdays 

30-60days 

lO&howings 

$0 

$0 

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1111 

25. Finally, the seller flow revealed the offer itself within a customized cost comparison 

chart, similar to the website “home sale calculator” displayed in paragraph 20. The chart 

projected the net proceeds each consumer would receive from accepting Opendoor’s offer versus 

selling on the market. The chart prepopulated Opendoor’s proposed purchase price and the 

market price as identical. In some cases, the seller flow showed the repair costs in both 

circumstances as “TBD.” In others, they showed the estimated repair costs as identical. Below is 

a version of the comparison chart. Opendoor used this or a similar format for all its offers. 

26. The bottom line of the chart projected the “net proceeds” that consumers should expect to 

receive from a sale to Opendoor and from a traditional sale. As of November 2019, over 

percent of these charts used in accepted offers projected that the consumer would realize more 

net proceeds by selling to Opendoor. The average projected gain was more than . 

27. Offers have also included information about market costs. As shown in the representative 

example below, the offers typically represented that consumers selling traditionally should 

expect to pay six percent in agent commissions, two percent in concessions at closing, and one 

percent in “home overlap costs”: 

8 
 

 

 

 

 

 

net proceeds 

Sale price 

Selling fees O 

Closing costs o 

Seller concessions 0 

Home ownership/overlap 

costs 

RepairsO 

Opendoor 

$268,466 

$284,800 

5% $14.240 

0.74% $2,094 

'Jone 

None 

X 

Traditional 

\IS $257,074 

$284,800 

6% $17.088 

0.74% $2,094 

2% $5,696 

1% $2,848 

j 

28. In some instances, Opendoor included two disclaimers at the end of the seller flow. Those 

disclaimers were not conspicuous and were in fine print. Moreover, they did not cure Opendoor’s 

repeated representations that it provided market value offers and that consumers were likely to 

make more money selling to it. Rather, one merely stated that “[t]hese figures are our best 

estimates” and the other stated, in direct contravention to Opendoor’s marketing, that the offer 

“does not necessarily represent the ‘market value’ of your home” because it was not a formal 

appraisal. 

29. The net proceeds comparison charts have provided more information about certain line 

items if consumers clicked a link adjacent to those line items. For example, if a consumer clicked 

an icon next to repairs on one version of the chart, a popup graphic provided the following 

explanation: 

Our philosophy is to ask for repairs we anticipate the next buyer of the home will 

ask for. We look for items that are broken, in poor condition, or can affect the 

safety, structure, or functionality of the home. Some examples include roof, 

foundation, flooring, electrical, plumbing, HVAC (heating, ventilation, and a/c 

systems), and appliances. On average, a typical repair request ranges from $___ to 

$_____, but can vary depending on the condition of your home. 

9 
 

 

 

 

 

 

 

 

 

 

- ■ 

Other versions of the offer described repair costs as “[s]imilar to what you’d expect to pay 

traditionally.” In emails, Opendoor described its repair-assessment process as an “inspection” 

similar to post-contract inspections in market sales. 

Most Consumers Who Sold to Opendoor Lost Money. 

30. Contrary to Opendoor’s promises, consumers actually lost thousands of dollars selling to 

it compared to what they would have received from a traditional sale. Its offers have not been 

market value but consistently averaged thousands of dollars below market value. And the costs 

consumers have paid when selling to Opendoor have been higher than what consumers typically 

pay in a market sale. 

Opendoor Offered Below Market Value for Homes. 

31. The overwhelming majority of Opendoor’s offers have been significantly below what 

consumers would have received if they sold on the open market. 

32. Opendoor took various steps to reduce offers below what their internal valuation system 

deemed to be a home’s market value. 

33. In or around August 2018, Opendoor instituted a policy of lowering offers to cover 

anticipated repair costs. The policy reduced offers without disclosing that they were less than 

market value. If actual assessed repairs were lower than the amount withheld, Opendoor retained 

the difference as revenue. Even before implementing this policy, Opendoor would reduce certain 

offers to account for potential repairs, which simultaneously provided a sub-market offer and 

concealed assessed costs from consumers. 

34. Opendoor has used an automated system to generate expected market values for homes. 

In many instances, Opendoor’s employees have manually adjusted these values before presenting 

them to consumers as offers. Opendoor’s internal analyses showed that these manually adjusted 

offers were several percentage points below Opendoor’s assessment of market value. Beginning 

no later than 2019, Opendoor instituted a policy to reduce its manually adjusted offers to

 below what Opendoor assessed as market value. 

35. For automated offers, Opendoor instituted a “risk-based pricing” policy in or around June 

2019 that automatically reduced offers below Opendoor’s assessment of market value to account 

for risks inherent in reselling the home. This was contrary to Opendoor’s marketing claims that 

the company accounted for these risks in setting the custom fee associated with each offer. For 

example, Opendoor’s website explained that the fee varied to cover “risks and holding costs of 

the home.” 

36. At various times, Opendoor has reduced its offer prices to enable it to understate its fees, 

making its services appear more financially attractive compared to traditional sales or to its 

competitors. 

37. Consumers had no reason to know that Opendoor had reduced their offers through the 

means described in paragraphs 33-36. Opendoor promoted the offers as “market value,” its price 

comparison chart showed the same price for Opendoor’s offers and market offers, and Opendoor 

10 
did not disclose these reductions thereby masking its higher costs compared to market sales and 

competitors. 

38. Opendoor's own internal analyses show that its offers have been, on average, below what 

consumers would receive on the open market. InNovember 2018, for example, one analysis 

examined prope1ties on which Opendoor had made offers that the consumers rejected. The 

analysis shows that those prope1ties sold for more on the open market than the amounts 

Opendoor offered, in some cases by as much as percent. Other internal analyses show that 

Opendoor's offers were consistently below market. One found in late 2018 shows thatpercent ofhomes on which Opendoor made an offer eventually sold on the open mark~re 

thanlpercent more than Opendoor' s offer price. A third-party analysis perfo1med in 2017 

concruded that Opendoor's profit from buying and selling could not be fully explained by 

Opendoor's renovation ofthose homes. 

39. Opendoor claimed that it did not make money from "buying low and selling high," but 

from "charging a fee for [its] service." But gains from selling homes for more than its offer price 

are a key contributor to its revenue. A 2019 financial analysis broke down revenue from 

Opendoor's fee and from "net resale gain" and repo1ted over-in resale gains in 2018 

and-in projected resale gains in 2019. Presentations to investors touted "resale gain" 

as a significant contributor to Opendoor's revenue per home. 

40. The company also understood more generally that its offers were below market. A 

presentation in 2016 noted that "[s]ellers that [sic] reject OD offers make more on the open 

market than their OD offer." In 2019, another internal communication stated bluntly, "We don't 

offer a fair market value to our customers." 

41. Data from Opendoor' s real estate transactions confnm that Opendoor makes money not 

just from its fees, but also from buying homes low and selling them high. After purchasing 

homes it lists them on the open market for resale. From 2016 through Febmary 2020, Opendoor 

soldI percent ofits homes for more than what it offered consumers. Th~e gain on these 

homes was_, or ■ percent ofthe homes' average offer price of-. 

Opendoor's' Costs Were Higher than What Consumers Would Have Paid in Traditional Sales. 

42. Contra1y to Opendoor's claims that its home-buying service would save consumers 

money, Opendoor's costs were higher because it required consumers to pay for repairs that they 

would not have had to make in a traditional sale. In addition, Opendoor overstated the costs 

associated with traditional sales. 

Opendoor Demanded Repairs for Which Consumers Would Not Pay in Traditional Sales. 

43. After the offer, Opendoor has required an in-person "home assessment" to reassess its 

estimation of value and to dete1mine whether repairs are necessaiy. IfOpendoor concluded that 

the initial offer was too high, it often rescinded the offer and re-offered a lower amount. 

44. Opendoor has almost always demanded consumers make or pay for repairs. Although its 

marketing has suggested that the com,ny may not require any repairs, as ofFebma1y 2020, 

Opendoor had demanded repairs for percent of homes on which Opendoor had made an offer. 

11 
Opendoor's internal study ofsellers who withdrew after receiving repair demands showed that 

those who sold on the market did so without making all the repairs that Opendoor demanded. 

45. As prut ofthe repair process, Open door has sent consumers a list ofrequired repairs with 

the cost it would charge consumers if they agree to deduct the costs from their sales proceeds. 

The list ofrepairs has been typically well beyond what consumers would be responsible for in a 

market sale. Opendoor has routinely requested upgrades to, or replacement of, fimctional heating 

and cooling systems, flooring, and roofs. It has also frequently demanded cosmetic changes such 

as repainting and replacement ofitems that could be repaired at far lower cost. 

46. According to Opendoor's own internal study, as of March 2019, Opendoor demanded 

repairs that cost, on average . The same study concluded that, in a traditional sale, 

consumers spend less than , with ru1 average of- or less than- percent ofthe 

average purchase price. A separate internal study found that Opendoor's "repair ask" is ■ 

percent ofthe purchase price. Another internal survey examining consmners who cancelled after 

leruning ofOpendoor's repair assessment found that ove■ percent ofthem sold their homes 

without paying for any repairs and concluded that Opendoor's "repair asks are NOT in line with 

market." 

47. Unlike traditional sales, Opendoor demanded that consumers make or pay for all 

demanded repairs, even though Opendoor's own studies indicate that the pruties to a mru·ket sale 

typically share these costs. The repair demands were not subject to negotiation. 

48. Opendoor at times has taken up to 18 days after consumers agree to the initial offer to 

provide them with the list ofrepairs. By that time, many consumers had ah-eady placed deposits 

on new homes and could not walk away from the new home purchase without incmTing a 

financial penalty. Opendoor's internal communications have described the lag between the initial 

offer and the later, significantly lower offer as a '"bait-and-switch' operation." 

49. In or around August 2018, Opendoor implemented an "Estimated Repair Credit," which 

smTeptitiously reduced offer prices to cover some ofthe repair costs. Opendoor never disclosed 

this "credit," and continued to describe its offers as representing the company's best estimate of 

market value without any adjustment. 

50. Opendoor encourages consumers to authorize it to perfo1m the repairs and to deduct the 

costs from the net proceeds ofthe sale rather than an-ange for the repairs themselves. The 

company has emphasized the convenience of deducting the repair costs ru1d, as described above, 

suggested that the proposed repair costs are discounted and therefore less than what the 

consumer would pay on the open market. 

51. Ifthe consumer decides to authorize Opendoor to complete the repairs and deduct the 

estimated costs from the sale proceeds, Opendoor completes the repairs after it acquires the 

property. Ifthe repairs cost less than the amount deducted, Opendoor retains the excess as profit, 

including the undisclosed Estimated Re~tthat Opendoor deducted from its original 

offer. One internal study fOlmd that for- ofOpendoor's purchases, its deductions for 

repair costs were greater than Opendoor's actual costs, thereby "taking away- ofseller 

equity" in each ofthose sales. 

12 
 

 

 

 

 

 

 

 

 

 

 

I 

I 

- -■ 

-

-

-

Opendoor Overstated the Costs of Traditional Sales. 

52. To make Opendoor’s offers appear more financially beneficial than they actually were, it 

misrepresented the amounts sellers should expect to pay for certain costs of traditional sales. The 

net proceeds calculator stated that consumers should expect to pay nine percent in real estate 

agent commissions, “seller concessions,” and home overlap costs. In fact, Opendoor’s data 

showed that sellers were likely to pay much less, and the company had no other data supporting 

its representations about traditional costs. Its marketing also claimed that consumers would likely 

pay one percent of their sales price, i.e., thousands of dollars, for “staging and prep work.” 

However, in traditional sales, many consumers do not pay to stage their homes prior to sale. 

53. During the time Opendoor made inflated claims about the costs of traditional sales, it 

possessed data suggesting that those claims were false. For example, it claimed that sellers 

should expect to pay two percent in “concessions” when selling on the market, but it only paid 

percent in concessions when it resold homes. 

Consumers Typically Lost Thousands Selling to Opendoor. 

54. As of November 2019, Opendoor had promised more than percent of consumers from 

whom they purchased homes that they would save significant money selling to it, with an 

average projected savings of over . In fact, as it was aware, consumers were likely to lose 

money selling to Opendoor. 

55. Its own internal analyses show that consumers lost money selling to Opendoor. For 

example, a March 2019 analysis of consumers who had accepted an Opendoor offer, but 

withdrew after receiving Opendoor’s repair demand, found that percent made more money 

selling on the open market, with an average gain of compared to what they would have 

received from Opendoor. Other internal analyses have found similar results. 

56. Opendoor transaction data confirms that consumers who sold to Opendoor have lost 

money compared to what they would have received through a traditional sale. Opendoor’s data 

shows that as of February 2020, the average resale price of its homes was . However, 

consumers received only on average due to Opendoor’s lower offer prices, deductions 

for repairs, and fees. If those consumers had instead sold on the market for the price Opendoor 

received on resale, they would have thousands more in net proceeds, even if they had paid the 

nine percent Opendoor claimed they would pay in agent fees, seller concessions, and overlap 

costs, and paid for repairs. 

Count I 

False or Unsubstantiated Claims 

57. In connection with the advertising, promotion, offering for sale, or sale of its homebuying business, Respondent has represented, directly or indirectly, expressly or by implication, 

that consumers are likely to realize more money selling their homes to Respondent than they 

would realize if they sell their homes in traditional sales, such as representing that: 

a. Respondent’s offers represent its projections of the market value price of consumers’ 

homes without any downward adjustments; 

13 
 

b. Respondent makes money from disclosed fees rather than from “buying low and 

selling high”; 

c. Consumers will likely pay the same amount in repair costs whether they sell their 

homes to Respondent or sell their homes in traditional sales; and 

d. Consumers will likely pay less in costs by selling to Respondent than they would pay 

in traditional sales: 

58. The representations set forth in Paragraph 57 are false or misleading, or were not 

substantiated at the time the representations were made. 

Violations of Section 5 

59. The acts and practices of Respondent as alleged in this complaint constitute unfair or 

deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal 

Trade Commission Act. 

THEREFORE, the Federal Trade Commission this _______ day of _______, 20__, has 

issued this Complaint against Respondent. 

By the Commission. 

April J. Tabor 

Secretary 

SEAL: 

14