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Hmmmm….that seems very unlikely. I have friends that worked for Opendoor and Redfin and they usually wouldn’t spend more than $350-400 thousand on a house. Flipping million dollar homes isn’t really a thing. 🤨
@@Jeez001 The housing shortage is not due to ibuying. We simply don't have enough homes available in the most desirable locations. Without enough supply, the richer folks will push up the prices because they can afford to pay up for a preferred location. Why would sellers decide to take less money to sell to a poorer person after all. That leaves all the normal folks priced out. They then move to the less desirable but still ok locations which then drives up the prices there and push out the poor folks. Poor folks then end up going into the least desirable locations (bad schools, high crime, long commutes, etc). The simplest way to drive down home prices is increasing density in the most desirable locations but the rich folks don't want normal/poor folks in those areas so they block new developments. It's a whole system of issues that causes high home prices in the best areas. here are more than enough homes to house everyone, the question is, do you really want to live where the homes you can afford are located.
2021 was their best year ever but they still managed to lose money - yeah and i see stock based compensation coincidentally quintupled that year. those execs had a nice year
About a year ago I was in the market to buy a house and open door had listed it the house was beautiful but when I paid for a inspection I found out that the roof was going to have to be replaced soon..open door didn’t want to fix it or negotiate on the pice..They knew that roof was bad
If they pay fair value for a home, how could that be a business - if there’s no margin there is no hope for a business They’re advantage is they can provide liquidity fast - that’s what they should have marketed
As someone who was looking for a house a few years ago, consistently, OpenDoor houses were always not taken care of and looked horrible. Simple yard upkeep would have made a huge difference. And forget it if they had a pool. So sad.
This was not truly a goal but rather a manifestation of greed and foolishness. The collateral bi-credit situation was laughable in Texas; it's good that they pursued legal action.
Hmm, so I can very easily get a quote from them in addition to the normal process, so if they give me a worse offer, there is no reason to sell to them. If they give a better offer then the local agents, I just made money. What prevents their offers from being used this way? (I think you or some other channel pointed out this problem in relation to Zillo's iBuying.
It's incredible how they didn't see the failure of this product coming from a mile away. Ever since 2016, homes have been selling at breakneck speeds. This was just increased during covid. I looked for houses on and off for 7 years before I finally got a good home that didn't require me to pay 25% over asking in cash and waive inspection. Almost every house I looked at was sold by a traditional realtor within 2 weeks for well over asking price. Nobody in the right mind would go through this platform to speed up the process by a day or two which is exactly what was touched on.
This year is going to be worse than the last, no doubt about it. Due to poor investment decisions that I would not have made if I hadn't been so concerned about my portfolio, I lost a significant amount of money last year. I continued to invest, but I was undecided about whether to begin making house payments. I eventually sold my jobs, and the house required more work than I had anticipated. I'm not sure how much longer I can continue in this manner.
Indeed. With the assistance of a financial planner, I was able to diversify my portfolio across multiple markets and attain a net profit of over one million dollars by utilizing high-yielding bonds, ETFs, and shares. Having exposure to a range of companies, including ones that are currently producing cash flows, is essential.
This business model might be able to make money if they purchased high yield homes that have expected rental returns higher than the cost of debt. If a large company that spreads risk across a lot of assets can get debt at lower rates than individual lenders, this could offer returns slightly beating the broader market. However, these type of companies already exist (especially for commercial properties) and you'd not be able to generate a huge amount of startup buzz.
That guy is responsible for some of the biggest destruction of investor capital in recent history. Just so he can put a few more dollars in his pocket and brag about cheating the "smart" money. He and Cathie Wood are like black holes of money. People's money gets sucked in never to be seen again. How these guys keep getting investor money is mind boggling to me.
Open door would have worked if it was a brokerage between a buyer and seller. Undercut the real estate agent model by taking only a 4% commission or so. It might still have failed, but at least it would have had a chance and wouldn't have been so absurdly vulnerable to price fluctuations
depending on where you live, open-door makes no sense. especially for example like costal cities. where I live for example, this area is very hot and desirable. buyers and sellers are in constant bidding wars. yes, you pay fees in a traditional sale but you walk away with way more.
How did they last this long? Even the slightest look into the business model shows thisnis completely nonviable unless you can find a constant stream of suckers willing to sell their homes 20% below market value.
Yes and with how easy it is to get a fair market estimate, I don’t know who would go with open door unless they know something open door doesn’t… I have a feeling a lot of these people that sold to open door have lemon homes with pretty serious problems (serious noise problems, bad locations, bad neighbors, etc… crap that won’t be caught on an inspection but will be a serious issue for any discerning buyer). To give you an example my home is worth about $540k and open door sent an offer of $450k, it was laughably low. You would have to know NOTHING about your local real estate market to accept that offer.
@@darkgalaxy5548 I sold my house to Opendoor. They offered me more than I asked for, but the "repairs" brought it down a little bit. It's a very convenient way to sell if you, for example, are unable to have people coming in and out of your house for showings, and as a seller you basically pay half of the fees you would with the normal real estate scam of seller having to pay both agents. I say "repairs" because I know for a fact they didn't do any of the repairs they charged me for, which in and of itself should be considered fraud, since the specific repairs and their cost were part of the contract. But anyhow, I walked away with more money in my pocket, didn't have to make any repairs, didn't have to show my house, chose my own closing date, and did my closing remotely over the computer.
They should never have been buying the homes, just like Amazon doesn't own the inventory. They should have just been a marketplace and possibly offered mortgages.
I have never seen a decent house from MarkSpain or Opendoor. They usually have the worst homes which are priced much higher than the rest of the homes in the area.
The man's face in the frame @12:36 says it all. It is obvious he is thinking, "Yeah, after we have babies and the kids get a little older, they will undoubtedly destroy this room, and that's ok, I can see myself being absolutely miserable in this room, and I am ok with this reality." 😌
Flippers that don't make their proper homework will lose a lot of money when they sell. This is what they do, they flip homes poorly. I've bought from open door and knew they were either breaking even or losing money.
This reminds me of the joke about the businessman who says he's losing money on each sale. Someone asks him how he stays in business. "Volume". What a horrible business model. Take a LOT of capital and put it into the volatile real estate market. Oh, that always ends well! And in this day and age when sellers are getting multiple offers --- sometimes sight unseen --- why would you sell for less than market? I know someone that put in a bid on one house and they had 30 offers.
anyone who has ever gone through a home buying/sale process who isn’t like, a rich silicon valley hack who has no idea how normal people live and keep their finances, would have known the i buying thing was a bunch of bullshit from the get go lol. houses just don’t work like that
WSM... What happened? Sad to see we're at the point of shilling misinformation... There's no actual way being unemployed is better than having a job of any kind
Open door was a stupid idea to begin with. Sure selling your house is a pain, but when tens of thousands of dollars are on the line, it’s a pain that’s worth it.
So much happiness and joy $47k weekly returns has been life changing. AWESOME GOD I now have a house and can now afford anything for my family even with my Retirement..
This was a dumb idea to begin with, there's no way to disrupt property market unless you're somehow able to move the product (aka sell) faster than traditional sale.
Open door always has been garbage. I looked at a few houses that of was selling, no repair done, in really bad shape but still asking comparable prices like other prep'ed houses.
I sold my house to Opendoor, and you are correct that they didn't do any of the repairs. I was charged for a few itemized repairs that were very obviously not completed. But I couldn't complain since they offered me more than I had even asked for.
So you’re saying that Realtor’s come up with home valuations on the back of the napkin but Open Door used cutting edge AI and algorithms to value homes. Only to then make a video about the flawed valuation model of Open Door. So can you admit that your premise about how Realtors value homes is incorrect?
Open door is the wrong business partially, it makes more sense to use technology and humans to try and buy houses at the best price and rent it out, using the portfolio as a leverage to get debt and invest that debt into something more profitable, ow wait black rock
Where the hell are all the doomsdayers that were claiming that there was some corporate conspiracy to make everyone in the US a renter? That shit was never a thing cause there's simply not enough profit in flipping houses without either adding value to the house or cashing in on a surging appreciation market. All these companies were doomed to fail from the start.
WSM... let's be super clear. We all heard these for-profit tech college, career guarantee, no money down, easy loan application advertisements. I like your videos, but your channel has just as many sus sponsors as anything reasonable.
stupid business with strange investors, who invest in a business like this !! this chamath is the king of stupid deals but for some reason he is still to be considered a businessman, how is that !! I don't understand 🧐🧐🧐🧐
Who invests in a business like this? People who aren't using their own money to invest, that's who. It's easy to gamble on a long shot when you're playing with someone else's pension fund and they won't know it's gone for another 10 years or so.
@@NorthStarBlue1 that is understood, but you can not fool the investors 12 times, non of his investments turn profit, all of them lost billions while he was taking his cut and liquidating his position immediately at the IPO, I think we'll soon hear about a money laundering schemes related to this guy.
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Whenever you hear "Went public by merging with a SPAC", you know it's all going down the toilet eventually.
Especially with an Indian name
@@Jordan-Ramsesthose SPACs went down the loo
@@Jordan-RamsesHe is a sri lankan.
DJT lol
😂
1. Never earned a profit 2. Deceptive tactics 3. Extra unnecessary steps 4. My due diligence... that's a sound business by today's standard
You just described crypto industry
You forgot merged with a SPAC!
30 seconds in and you've mentioned AI, Big Data, an App and a SPAC. It's like shady investment bingo.
Hah!
I sold my house to redfin April 2022 for a million dollars, they sold it to the next guy December of 2022 for $650k.
Perfect
You should have bought it back for 660k 😂
😂
Why didn't you buy it back, pocket the $350,000 and move back in ?
Hmmmm….that seems very unlikely. I have friends that worked for Opendoor and Redfin and they usually wouldn’t spend more than $350-400 thousand on a house. Flipping million dollar homes isn’t really a thing. 🤨
"merging with a SPAC" - famous last words 😅
I know people who get quotes from company like this to challenge property assessments.
“The worst kind of business is the kind that rips off its customers yet still manages to lose money.“
(basically most startups nowadays)
A business model that forces you to buy high and sell low is impressively stupid.
iBuying was such an embarrassment... you get what you pay for and if you’re paying next to nothing to sell/buy a home, there's a reason...
Ibuying is one of reason we have housing shortages as it takes away homes from being listed reducing no of listing
@@Jeez001 The housing shortage is not due to ibuying. We simply don't have enough homes available in the most desirable locations. Without enough supply, the richer folks will push up the prices because they can afford to pay up for a preferred location. Why would sellers decide to take less money to sell to a poorer person after all. That leaves all the normal folks priced out. They then move to the less desirable but still ok locations which then drives up the prices there and push out the poor folks. Poor folks then end up going into the least desirable locations (bad schools, high crime, long commutes, etc). The simplest way to drive down home prices is increasing density in the most desirable locations but the rich folks don't want normal/poor folks in those areas so they block new developments. It's a whole system of issues that causes high home prices in the best areas.
here are more than enough homes to house everyone, the question is, do you really want to live where the homes you can afford are located.
Depending on the cpu try immigration has exacerbated the issues you described.@BigRedNutcase911
@@BigRedNutcase911yes but it is one of many reasons. See what is happening with inventory in Texas now as ibuying have gotten out of that state..
@@Jeez001 What do you honestly think happens to the houses after they buy them...
Chamath has great skills in sales, marketing and grifting. Too bad he dumps on his fanbase like any internet scammer lmao.
Chamath is a huge Musk fan.
@@dirk-piehl28 Gandhi Boy is also a huge Trump fan, lol.
@@dirk-piehl28 he's a huge fan of anyone beneficial for his bottom line
Merging with a SPAC = Dumpster Fire
I can't name one that did not dump😅
Draftkings
@@teemoe5937 ...that's good to know...1 out of 100.
@@thinktankindi2664 haha yep not good odds
2021 was their best year ever but they still managed to lose money - yeah and i see stock based compensation coincidentally quintupled that year. those execs had a nice year
About a year ago I was in the market to buy a house and open door had listed it the house was beautiful but when I paid for a inspection I found out that the roof was going to have to be replaced soon..open door didn’t want to fix it or negotiate on the pice..They knew that roof was bad
He is a stock rugpull artist
‘Merged with a SPAC’ and ‘failure’ go hand in hand
If they pay fair value for a home, how could that be a business - if there’s no margin there is no hope for a business
They’re advantage is they can provide liquidity fast - that’s what they should have marketed
Their "AI algorithm" is most likely a glorified Excel spreadsheet with fancy macros enabled. 😂
As someone who was looking for a house a few years ago, consistently, OpenDoor houses were always not taken care of and looked horrible. Simple yard upkeep would have made a huge difference. And forget it if they had a pool. So sad.
7-10% !!!!! in the UK we pay about 1% and many think that too much !!!!
Capitalism baby!
Canada 5%
My favorite short- still waiting to go down to zero- will short more once short squeeze risk subsides-
You had me at "Chamath took it public" 😂
😂
I was more fascinated with the commercial than anything else’s. I would like to see you do a video on the success or lack thereof in future
This was not truly a goal but rather a manifestation of greed and foolishness. The collateral bi-credit situation was laughable in Texas; it's good that they pursued legal action.
Hmm, so I can very easily get a quote from them in addition to the normal process, so if they give me a worse offer, there is no reason to sell to them. If they give a better offer then the local agents, I just made money. What prevents their offers from being used this way? (I think you or some other channel pointed out this problem in relation to Zillo's iBuying.
If you build your company off of lies and deceit you’re doomed.
Tell that to the federal reserve! 😂
@@user-je4xp5hq2e good point
It's incredible how they didn't see the failure of this product coming from a mile away. Ever since 2016, homes have been selling at breakneck speeds. This was just increased during covid. I looked for houses on and off for 7 years before I finally got a good home that didn't require me to pay 25% over asking in cash and waive inspection. Almost every house I looked at was sold by a traditional realtor within 2 weeks for well over asking price. Nobody in the right mind would go through this platform to speed up the process by a day or two which is exactly what was touched on.
This year is going to be worse than the last, no doubt about it. Due to poor investment decisions that I would not have made if I hadn't been so concerned about my portfolio, I lost a significant amount of money last year. I continued to invest, but I was undecided about whether to begin making house payments. I eventually sold my jobs, and the house required more work than I had anticipated. I'm not sure how much longer I can continue in this manner.
Everybody has erred at some point. It's wise that you think about financial planning.
Indeed. With the assistance of a financial planner, I was able to diversify my portfolio across multiple markets and attain a net profit of over one million dollars by utilizing high-yielding bonds, ETFs, and shares. Having exposure to a range of companies, including ones that are currently producing cash flows, is essential.
Please let me know who your adviser is if it's okay; I need some recommendations
*Leah* *Foster* *Alderman*
You are most likely to find more info when you look her up
Make a video on downfall of China real estate market.
Their business model was 'buy high, sell low', on top of all the issues they had with finding local contractors, title companies, attorneys, etc
This business model might be able to make money if they purchased high yield homes that have expected rental returns higher than the cost of debt. If a large company that spreads risk across a lot of assets can get debt at lower rates than individual lenders, this could offer returns slightly beating the broader market. However, these type of companies already exist (especially for commercial properties) and you'd not be able to generate a huge amount of startup buzz.
Still not as bad as the insane crypto grift and fraud
His name is Scamath Ponzihappytiya
That guy is responsible for some of the biggest destruction of investor capital in recent history. Just so he can put a few more dollars in his pocket and brag about cheating the "smart" money. He and Cathie Wood are like black holes of money. People's money gets sucked in never to be seen again. How these guys keep getting investor money is mind boggling to me.
Open door would have worked if it was a brokerage between a buyer and seller. Undercut the real estate agent model by taking only a 4% commission or so. It might still have failed, but at least it would have had a chance and wouldn't have been so absurdly vulnerable to price fluctuations
If they couldn't turn a profit with the insane housing market, what happens if the housing market has a massive correction?
depending on where you live, open-door makes no sense. especially for example like costal cities.
where I live for example, this area is very hot and desirable. buyers and sellers are in constant bidding wars. yes, you pay fees in a traditional sale but you walk away with way more.
Basically a wholesale business model , first rule of wholesaling u cannot , create motivation.. people either want to sell or need to sell ..
How did they last this long? Even the slightest look into the business model shows thisnis completely nonviable unless you can find a constant stream of suckers willing to sell their homes 20% below market value.
Yes and with how easy it is to get a fair market estimate, I don’t know who would go with open door unless they know something open door doesn’t… I have a feeling a lot of these people that sold to open door have lemon homes with pretty serious problems (serious noise problems, bad locations, bad neighbors, etc… crap that won’t be caught on an inspection but will be a serious issue for any discerning buyer). To give you an example my home is worth about $540k and open door sent an offer of $450k, it was laughably low. You would have to know NOTHING about your local real estate market to accept that offer.
Well open door, see mountain is a Chinese proverb, meaning do not hide the difficulty
Forgotten about another one of Chamath's gems 😂
How is buying a bunch of houses "capital light?"
Great info! ❤
Maybe they could rent out the houses in the time they can't sell them or to wait for a better market. They could even use Airbnb I guess.
If the seller needs a quick sale and is not relying on profit from the sale of the house, these types of buying/selling situations can be ideal.
How many sellers aren't relying on the proceeds from a sale 🤔
@@darkgalaxy5548 I sold my house to Opendoor. They offered me more than I asked for, but the "repairs" brought it down a little bit. It's a very convenient way to sell if you, for example, are unable to have people coming in and out of your house for showings, and as a seller you basically pay half of the fees you would with the normal real estate scam of seller having to pay both agents. I say "repairs" because I know for a fact they didn't do any of the repairs they charged me for, which in and of itself should be considered fraud, since the specific repairs and their cost were part of the contract. But anyhow, I walked away with more money in my pocket, didn't have to make any repairs, didn't have to show my house, chose my own closing date, and did my closing remotely over the computer.
They should never have been buying the homes, just like Amazon doesn't own the inventory. They should have just been a marketplace and possibly offered mortgages.
7% fee? Traditional is only 6% but can be negotiated lower. 💁
They are similar to no-haggle car dealers. U are paying extra for the "convenience".
Good 'ol buy high sell low tactic.
Calculate the value on the back of a napkin !!!
I have never seen a decent house from MarkSpain or Opendoor. They usually have the worst homes which are priced much higher than the rest of the homes in the area.
When will you report on tripleten failing ?
WTF is opendoor, I will watch and find out.
Title changed while watching 🎉
A home is not an asset but a liability
The man's face in the frame @12:36 says it all. It is obvious he is thinking, "Yeah, after we have babies and the kids get a little older, they will undoubtedly destroy this room, and that's ok, I can see myself being absolutely miserable in this room, and I am ok with this reality." 😌
Talkspace was a dirty little spac offered at $11 but $2 now... but carvana is still around
Flippers that don't make their proper homework will lose a lot of money when they sell. This is what they do, they flip homes poorly. I've bought from open door and knew they were either breaking even or losing money.
BK in the horizon
I'm sure they clouded the title as soon as they gave an offer too.
Luke Lango says buy Opendoor stock
Nice!
This reminds me of the joke about the businessman who says he's losing money on each sale. Someone asks him how he stays in business. "Volume".
What a horrible business model. Take a LOT of capital and put it into the volatile real estate market. Oh, that always ends well! And in this day and age when sellers are getting multiple offers --- sometimes sight unseen --- why would you sell for less than market? I know someone that put in a bid on one house and they had 30 offers.
Money IS NOT capital.
Capital is real property, including machinery and people.
I don’t see how anyone could think this idea could work. It was really just an investor scam.
Scamath Puppypuppytear is our billionaire savior
Will this go bankrupt soon
anyone who has ever gone through a home buying/sale process who isn’t like, a rich silicon valley hack who has no idea how normal people live and keep their finances, would have known the i buying thing was a bunch of bullshit from the get go lol. houses just don’t work like that
WSM says THus like Malfoy says Potter
They operated the same flawed 3rd party practice that Mr. Beast Burger did. Just adding a needless layer of complexity with the tiresome "AI" gimmick.
Why do they have to pay money to the FTC ? The FTC isn’t who took the loss it was the owner/seller of the house smh
im here
Nobody cares
If they want to make it work, just need to talk to the government and let them know not to charge tax twice
These money losing startup's are Robinhood. Especially the non publicly traded ones.
Why does Chamath does this?
WSM... What happened? Sad to see we're at the point of shilling misinformation... There's no actual way being unemployed is better than having a job of any kind
The moment it mentions spac and chamath you just got scammed 😂😂😂
Open door was a stupid idea to begin with. Sure selling your house is a pain, but when tens of thousands of dollars are on the line, it’s a pain that’s worth it.
Too focused on "disrupting the market" that they don't stop to think of a business model is even a good idea or not.
with interest going up, they are fucked
Don't worry, AI will turn it around!
So much happiness and joy $47k weekly returns has been life changing. AWESOME GOD I now have a house and can now afford anything for my family even with my Retirement..
wow this awesome 👏 I'm 37 and have been looking for ways to be successful, please how??
Grace
Angela
Boots
I will leave her info below this comment.
They should just rent those houses out to people.
This was a dumb idea to begin with, there's no way to disrupt property market unless you're somehow able to move the product (aka sell) faster than traditional sale.
If only the used VR instead of AI to sell the homes......sigh
Opendoor left an open door to open ended losses 😂
Open door always has been garbage. I looked at a few houses that of was selling, no repair done, in really bad shape but still asking comparable prices like other prep'ed houses.
I sold my house to Opendoor, and you are correct that they didn't do any of the repairs. I was charged for a few itemized repairs that were very obviously not completed. But I couldn't complain since they offered me more than I had even asked for.
The rise and fall of teladoc
Chamath was the biggest grifter of the 2020s
Chamath is the anti-Midas.
So you’re saying that Realtor’s come up with home valuations on the back of the napkin but Open Door used cutting edge AI and algorithms to value homes. Only to then make a video about the flawed valuation model of Open Door. So can you admit that your premise about how Realtors value homes is incorrect?
Open door is the wrong business partially, it makes more sense to use technology and humans to try and buy houses at the best price and rent it out, using the portfolio as a leverage to get debt and invest that debt into something more profitable, ow wait black rock
Where the hell are all the doomsdayers that were claiming that there was some corporate conspiracy to make everyone in the US a renter? That shit was never a thing cause there's simply not enough profit in flipping houses without either adding value to the house or cashing in on a surging appreciation market. All these companies were doomed to fail from the start.
Investors actually thought that was a good idea?
Good. We are saving to buy a house and these people have helped to fuck us
WSM... let's be super clear. We all heard these for-profit tech college, career guarantee, no money down, easy loan application advertisements. I like your videos, but your channel has just as many sus sponsors as anything reasonable.
It sounds like karma got them.
stupid business with strange investors, who invest in a business like this !!
this chamath is the king of stupid deals but for some reason he is still to be considered a businessman, how is that !! I don't understand 🧐🧐🧐🧐
Who invests in a business like this? People who aren't using their own money to invest, that's who. It's easy to gamble on a long shot when you're playing with someone else's pension fund and they won't know it's gone for another 10 years or so.
@@NorthStarBlue1 that is understood, but you can not fool the investors 12 times, non of his investments turn profit, all of them lost billions while he was taking his cut and liquidating his position immediately at the IPO, I think we'll soon hear about a money laundering schemes related to this guy.
🫡💪🏻
Why is every scam I see on YT have this tiny dude. Is he a pro scammer?
Zombie companies
Whatever.