After outpacing the competition, market conditions have finally caught up with the iBuyer, forcing it to prove that its model still works — even in a downturn.

 

Opendoor’s buy-to-sale premium — the difference between the purchase and resale price of its homes — has reached a record, negative low

Why it matters: For the first time in its existence, Opendoor is entering territory, where, in aggregate, it is selling homes for less than their purchase price.

Go back: Opendoor outperformed Zillow during the dark days of 2021 (when Zillow Offers imploded); its buy-to-sale premium never dipped below zero percent.

 

But 2022 is different; transposing Zillow’s performance in 2021 to Opendoor in 2022 shows a similar deterioration in the buy-to-sale premium.

Some perspective: Opendoor is selling around 2,000 houses per month with an average sale price of $400,000. A buy-to-sale loss of two percent amounts to a $16 million loss.