Opendoor vs. Offerpad: Everything You Need to Know in 2022

Andrew Whytock

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Andrew Whytock

August 4th, 2022
Updated August 4th, 2022

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Which one is better? | Fees | Locations | Reviews | The bottom line | FAQs

Opendoor vs Offerpad

In the early days of iBuyers, Opendoor was an obvious front-runner. It company covered way more locations, was more efficient with home sales, and generally had better customer reviews. However, in recent years, Offerpad has become a strong alternative to Opendoor.

Recent customer reviews of Offerpad are positive, and the company has unique perks like free local moves within 50 miles of your old home. Offerpad's emphasis on personalized service also means you might get better communication throughout your home sale.

The biggest X factor with either iBuyer company will be repair deductions. In our research, we found that some home sellers who requested offers were disappointed by how much lower their final offer was after repair credits had been added — a sign that the convenience of selling quickly sometimes (but not always) comes at a steep cost.

If you're serious about selling your home to Opendoor or Offerpad, you should request offers from both companies. You'll be able to compare costs and other factors side-by-side before making your final decision.

Clever can help you decide if the cost of convenience is worth it to you. Your Clever agent can present offers from Opendoor, Offerpad, and other cash buyers in your area. They can also provide you with a free home valuation, so you'll know home much your home is really worth.

Opendoor vs. Offerpad: Which one is better?

Opendoor's median purchase price is typically a bit higher than Offerpad's, according to a 2021 analysis of iBuyer purchases in Phoenix (one of the largest markets for both companies).[1]

Translation? Opendoor is usually willing to pay a bit more for your house. However, if you want a more customer-centric experience when you sell your home, Offerpad has an edge.

🏷 Opendoor still has more brand recognition

In our survey of 994 U.S. homeowners, 11% of respondents identified Opendoor as a legitimate iBuyer, versus just 7% who chose Offerpad. This doesn't automatically make Opendoor a better choice for you (both companies are legitimate) but the responses show that people are more familiar with Opendoor given its size and expansive coverage.

Opendoor is fast and easy, but negotiating is tough

Opendoor has an easy-to-use customer portal and makes in-app communication a breeze — which is great if you're comfortable using tech to conduct most of your home sale. Many home sellers who used Opendoor have pointed out how easy the entire process is.

One major downside is that Opendoor's computer-generated "preliminary offer" you see online might not be accurate, triggering recent complaints about how much lower Opendoor's final offer is. Further, some home sellers say you can't negotiate the price, even though Opendoor claims to let you "reevaluate" repair costs.

Offerpad gives you the option to complete repairs with your own contractor (rather than deducting repair costs from your offer). This might take a bit more time and cost you some money out-of-pocket, but it could also help you control repair costs to net more money from your home sale.

Offerpad gives personalized support

A common theme from Offerpad customer reviews is the strong communication between Offerpad representatives and home sellers. Past customers say it was easy to get in touch and stay up to date through every step of their home sale.

Both Opendoor and Offerpad may lower their final offers for repair costs

In verified customer reviews of both Opendoor and Offerpad, we found a number of complaints about repair deductions. Specifically, some customers felt that they were being overcharged for basic repairs and that this dramatically reduced their final offer prices.

Because every home is different, it makes sense that repair costs would be high at least some of the time. The more risk an iBuyer sees in purchasing your home, the more margin for error they need to create.

Different definitions of an 'instant' offer

The process for requesting an offer is slightly different with each company:

  • With Opendoor, you get a ballpark estimate right away — but the price you see online might not be close to the final price.
  • With Offerpad, you don't get an offer until your home's details have been reviewed by an actual human, but the price could still go down a bit after the final home inspection.

When you submit a request to Opendoor online, you're presented with a "preliminary offer" instantly, followed by a home inspection and a final offer (usually within 24 hours). [2]

With Offerpad, you won't see a preliminary offer after you request an offer online. Instead, you'll be contacted with an offer within 24 hours after an Offerpad pricing expert has had a chance to review your details. You'll still have to go through a home inspection to get the final offer in 24 hours. [3]

Fees

Both Opendoor and Offerpad charge sellers a 5% service fee. Opendoor allows sellers to cancel without penalty anytime before closing, whereas Offerpad charges a 1% cancellation fee.

Here’s how the fees break down on a $350,000 sale:


Opendoor
Offerpad
Sale price
$350,000
$350,000
Service fee (5%)
$17,500
$17,500
Cancellation fee (1%)
n/a
$3,500

Offerpad's 1% cancellation fee might be off-putting, but it shouldn't be a deal breaker. Just be sure that you want to accept the offer and proceed before signing an agreement.

On top of these fees, just like in a traditional sale, you’ll also have to cover closing costs — which vary by sale and usually range 1–3% of the sale price — yourself. The 5% service fees may seem substantial, but they’re comparable to the 6% commission commonly paid to agents during traditional real estate transactions.

Editor’s note: Even though the 6% commission real estate agents charge may be more than iBuyer fees, sellers still tend to make more money listing with an agent because homes tend to sell for more money on the open market.

Sellers who choose to list with a real estate agent don't have to pay 6% to get full service. Clever Real Estate can connect you with top-performing local agents who charge just 1% in listing fees, saving you thousands of dollars when you're ready to sell.

⚡ Connect with a top agent now!

Locations

Opendoor is active in 47 markets while Offerpad covers 25. They’re both active in major iBuyer markets, including:

  • Atlanta
  • Charlotte, NC
  • Dallas
  • Phoenix

Reviews

We analyzed hundreds of reviews from actual Opendoor and Offerpad customers. Because of its size, Opendoor has been reviewed thousands more times than Offerpad and has more reviews that are positive.

Opendoor's positive reviews touted its speedy process, competitive offers, and the seamlessness of the transaction. While some reviewers had issues with the cost of repairs, most customers were satisfied overall.

Offerpad's sellers praised the assistance they received with repairs, as well as the ease of the selling process.

Bottom line: Get offers from both, then talk to an agent

Even though we think Offerpad's flexibility makes it a slightly better option than Opendoor for most home sellers, we recommend getting offers from both companies (if you're in a city where both operate).

It's free to request offers from Opendoor and Offerpad, and there's no obligation to accept. This way, you can easily put the offers side-by-side and compare:

  • Your options for closing (timeline)
  • Additional costs like deductions for repairs
  • Perks (late checkout, free move, etc.)

If you really want to do your due diligence before accepting an offer, we also recommend talking to a real estate agent to find out what your home is worth on the open market.

Opendoor and Offerpad usually make fair offers, but they're almost always less than you could expect to get with a traditional home sale.

👋 Next steps: Talk to an expert

If you're weighing your options for buying or selling a house, Clever can help!

Our fully-licensed concierge team is standing by to answer questions and provide free, objective advice on getting the best outcome with your sale or purchase.

Ready to get started?

Give us a call at 1-833-2-CLEVER or enter your info below. Our concierge team will be in touch shortly to help.

Remember, this service is 100% free and there’s never any obligation.


From the author: I've written in-depth reviews of all the major iBuyers and had the chance to speak to industry experts and employees at Opendoor and Offerpad to get their perspectives.

I've also spent time reading investor presentations and researching market data from both Opendoor and Offerpad to find out what makes each company unique and identify where their strategies diverge.

Andrew Whytock
Content Team Lead
Clever Real Estate

FAQs about Opendoor and Offerpad

Both are good options if you need to sell quickly. We recommend requesting offers from both so you can compare and choose the best option for your situation. Data from industry experts suggests that Opendoor usually makes slightly higher offers than Offerpad, but Offerpad has unique perks like free local moves (within 50 miles) and a flexible closing window of 8–90 days.

Yes — like most iBuyers, Offerpad makes reasonable offers. If you sell your home to Offerpad, expect to get slightly less than you would on the open market.

Offerpad and Opendoor have lots of similarities: they make selling your home fast and easy with instant cash offers and the ability to close on your own timeline. They even charge the same 5% service fee, which is comparable to the 5–6% you'd pay a listing agent.

The main difference between the two is that Offerpad gives you a more flexible closing window of up to 90 days and the ability to use your own contractors for repairs if you don't want to offer repair credits.

Related links

ARTICLE SOURCES
[1]

Mike DelPrete. "iBuying is Hard: Zillow Pauses New Purchases." Updated October, 2021.

[2]

Opendoor. "Investor Presentation." Updated May, 2022.

[3]

Offerpad. "Investor Presentation." Updated May, 2022.

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