OpenDoor sees big opportunity because of NAR lawsuit

According to Opendoor executives, the Sitzer/Burnett verdict, anticipated to reduce purchase-side commissions, has the potential to generate cost savings for the iBuyer.

Amidst the aftermath of the antitrust case, which resulted in a guilty verdict and a significant $1.8 billion fine, Opendoor CEO Carrie Wheeler perceives an advantageous situation for residential brokerages.

“The commission paid to the broker representing the buyers constitutes around 2.5 basis points of our total cost framework, which holds significant importance,” Wheeler commented in the company’s earnings call for the third quarter. “In the event that there was a reduction or elimination of the buyer broker commission, it would lead to a decrease in our expenses.”

According to Opendoor executive Dodd Fraser, any impact on multiple listings services stemming from the verdict would also bring advantages to the company.

“We have been accumulating our own data for a decade, therefore we believe we are in a prime position to seize any advantageous data elements,” he stated.

The Sitzer/Burnett antitrust case claimed that the National Association of Realtors, which holds sway over the majority of multiple listings services in the nation, alongside a few prominent brokerages, colluded to increase buyers’ broker commissions. On Tuesday, a jury in Missouri rendered an initial verdict against NAR, Keller Williams, and HomeServices of America.

Opendoor’s stock experienced a significant decline in value upon the delivery of the verdict, but managed to recover from that loss and even surpass expectations on Thursday with a substantial 16.4 percent increase. Although the stock has doubled in value this year and reached $2.20, it has still undergone a decline of more than 50 percent since the middle of summer.