Compare REX Real Estate and Opendoor

For Sellers

Listing Rate
2%
Commission
Minimum commissions and other terms may apply. Buyer's Agent Commission (2.5%-3%) is not included, because REX does not offer a split option to buyer’s agents. If a buyer approaches the seller’s listing with a buyer’s agent, the buyer will be responsible for Buyer's Agent Commission amount out-of-pocket.

For Sellers

Cash Offers
15%-20%
Home Equity
Opendoor does not provide real estate listing representation. Instead, the company buys homes directly, repairs and resells them to consumers or companies that rent them to tenants. Opendoor makes an offer equal to 80%-85% of home value accounting for fees and any cost of the repairs and resale.

For Buyers

Buyer’s Savings
50%
Commission Rebate
When REX Real Estate represents home buyers, it contributes 50% of its Buyer's Agent Commission (2.5%-3%) to the buyer as a way to financially compete for a buyer’s business. Home buyers do not pay any taxes on the amount, the refund amount is always tax-free.

For Buyers

Not Applicable
0
No Rates
Opendoor does not provide real estate services to home buyers. Opendoor does resell some of the homes it buys on the open market, just like any other real estate investor aiming for the highest return on investment.
Question: What is the difference between REX Real Estate and Opendoor?
Answer: REX Real Estate is a full-service real estate agent that offers savings to homebuyers and home sellers while Opendoor is a direct home cash buyer that buys select homes off-market with cash offers and resells them at a profit to homebuyers
Compare REX Real Estate and Opendoor for home buying and selling. HomeOpenly is an impartial and an open resource focused on trending real estate services, portals and start-ups.

First published: 17 February 2019
Last updated: 25 April 2021

Buying and Selling with REX Real Estate

REX Real Estate is a California, Texas, Colorado, New Jersey, and New York real estate listing agent, offers consumers listing savings and buyer’s rebates for select areas. REX Real Estate does not offer Buyer's Agent Commission (2.5%-3%) split to buyer’s agents and does not list seller’s homes on the MLS.

MLS-less REX significantly lowers home's exposure to buyers working with their own agent and misrepresents many advantages of using MLS to sellers.

Further, REX Real Estate claims to save buyer's agent fee amount, but in reality, Buyer's Agent Commission is always defined by the seller and it is up to the seller how much she is willing to offer buyer's agent, not REX.

The listing rate of 2%, that the company offers, must be compared to a "traditional" listing fee of 3%. In this comparison, REX Real Estate listing savings are only 1% less than a "traditional" listing commission.

REX Real Estate Pricing

REX Real Estate offers savings to sellers with a commission set at 2%, and buyers a 50% commission rebate.

Listing Services

  • MLS Listing
  • Zillow, Trulia, etc. Listing
  • Accept and Deliver All Offers and Counteroffers
  • Hold Open Houses
  • Professional Photography
  • Professional Floor Plans
  • Yard Signage Installation
  • Spare Key Lock-box Installation
  • Schedule Inspection Services
  • Schedule Private Showings
  • Closing Duties

Buyer's Agent Services

  • Find the Property
  • Accept and Deliver All Offers and Counteroffers
  • Recommend Other Professionals
  • Attend Inspection Services
  • Schedule Private Showings
  • Negotiate Needed Repairs
  • Closing Duties

REX Real Estate Editor's Review:

REX Real Estate is a consumer-focused real estate agent that, unfortunately, claims a lot more than what it actionably delivers. REX Real Estate service includes posting home on its own web site and MLS Aggregator services, professional photos and 3D images in addition to all typical services offered by a traditional real estate agent.

The key disadvantage of using REX Real Estate is that it does not use MLS to advertise a listing property to other brokers. Any buyer who is represented by their own agent must pay a buyer’s agent fees out-of-pocket. This proposition gives REX larger control of how company’s listing data is distributed and an excuse to claim additional savings against 6% commission, but the seller pays the real price with a highly limited pool of self-represented buyers.

The company claims that it saves the seller a Buyer’s Agent Commission, but this amount is typically defined by the seller and it is never mandatory. In reality, REX Real Estate actionably offers 1% in listing savings compared to a “traditional” listing rate of 3%.

REX Real Estate further misrepresents volume of total savings when it claims that other agents that use “antiquated MLS and is set up like a traditional agency, can’t get away from the 3% buy-side commission.” This is false. There are agents who choose to waive or drastically reduce this fee if the buyer is self-represented and this amount if not set in stone. The only reason 2.5% - 3% buy-side commission is often recommended by other real estate agents is because it significantly increases listing exposure to potential buyers.

When comparing listing rates, Buyer’s Agent Commission amount is irrelevant and should never be used to “prop-up” the appeal of a competitive listing rate. This systematic misinformation is quite damaging to consumers who may not be aware of drawbacks associated with not offering the buy-side commission.

Further, REX Real Estate operates alongside many highly competitive real estate agents that offer consumers much better savings, such as flat fees - when the company claims it offers the lowest fee, this is simply not true. When working with other agents, REX Real Estate hypocritically receives Buyer’s Agent Commission from other listing agents when it represents buyers; REX Real Estate refunds 50% of that amount back to the buyer, as a tax-free commission refund.

We find that REX Real Estate offers nothing new over most any real estate agent, it simply games a few pieces of the existing process in an effort to claim that it has a found a way to replace an outdated MLS.

A well-defined MLS Aggregation process is actually very helpful to consumers because this information, now widely available online, helps people find and shop for homes easily. The real problems in the real estate process are excessive fees and hidden kickbacks between agents and referral fee networks.

Despite the fact that REX Real Estate is a model that offers listing savings to sellers, it receives an average score due to the misleading advertising policy and lack of home exposure to the MLS. REX Real Estate is still a great option for buyers due to 50% buyer’s refund.

Where does REX Real Estate operate?

REX Real Estate currently operates in select areas across California, Texas, Colorado, New Jersey, and New York.

Buying and Selling with Opendoor

Opendoor is a multi-state VC-backed real estate investor that operates across highly specific locations. Where available Opendoor mainly focuses on homogenous homes built after 1960 with a value between $125,000 and $500,000.

In determining the offer, Opendoor discounts from the estimated retail value after home is fully renovated.

Opendoor Pricing

Opendoor makes money with a difference between buying and selling each home. This difference is a combination of fees and home value appreciation between what Opendoor buys and seller each home for. Sellers can expect to receive 80%-85% of their home value from this type of sale after any fees, cost of the minor repairs, and resale.

Listing Services

  • This Service Does Not Represent Sellers

Buyer's Agent Services

  • This Service Does Not Represent Buyers

Opendoor Editor's Review:

Opendoor will buy a home at a price that is below market value due to necessary repairs, renovation, and other factors. After Opendoor buys the home, it renovates and resells it for a profit to other buyers or companies that rent homes to qualified tenants. With low offer price, comes a convenience of an all-cash closing when selling a home. Opendoor claims to provide convenience, speed, and certainty of a fast sale. Dubbed as an iBuyer, Opendoor makes an offer on a house within days or hours, but this offer is highly conditional. Each offer Opendoor makes is just an estimate until it makes a home inspection.

At the inspection, Opendoor will often find reasons to lower its original offer when it finds items that need repair or if it has made a mistake in its original valuation. When the company is unable to make an offer, it simply redirects consumers to a random real estate agent in exchange for an undisclosed referral fee. Opendoor offers fast home sales, but these are typically accompanied by higher fees (starting at 6% and rising to 12% for more risky properties.)

Opendoor only makes offers to select homes in select regions. Opendoor claims that it provides market offers, but we find this not be true. Search for past Opendoor transactions makes it clear that company also makes money with home appreciation difference (typical appreciation of 5.5% to 12.5%) between what it buys houses for and what it sells them for in addition to service fees. The main disadvantage of using Opendoor is high losses in homeowners' equity.

Opendoor is a "heavy" model, backed by a large amount of VC capital ready to buy homes in all-cash transactions. As any real estate investor, Opendoor is susceptible to losing money in any given transaction. This model is susceptible to a number of risk factors, high operational costs and a continued need for higher-than-average Return on Investment (ROI) with each flip. Opendoor is not legally bound to represent consumers, its main legal obligation is to its shareholders.

Opendoor's fast transaction and easy move-out experience typically come at an extremely high price because this model incurs "double" transaction costs during the purchase, holding period, rehab work and final sale that includes real estate agent fees. Opendoor pays real estate agent commissions like any other buyer and seller of real estate, so these costs must be accounted for in the company's fee structure. The facts continue to point against Opendoor’s claims that it offers fair value for the houses it buys.

Moreover, because most homes in the United States are financed, homeowners own only partial net equity in their home. Banks receive the same amount of the remaining mortgage sum regardless of how any given home is sold, whereas only homeowners' net equity is lost in transaction fees paid to Opendoor.

Typically Opendoor uses the following factors when determining the offer: existing condition of the home including repairs needed, time it will take to finish needed repairs, value of a home compared to other comparable homes in the area, real estate commission required to resell, costs associated with maintaining a home during repairs, including taxes, payments, insurance, utilities and homeowner dues.

Today, there are a number of highly qualified real estate agents who offer competitive listing rates and flat fee listings across the United States. Unless a situation absolutely requires a quick sale, HomeOpenly recommends that consumers first consider using a licensed real estate agent working on competitive terms to properly list their homes on the open market before turning to Opendoor option.

Some real estate agents are now offering Concierge services that include painting, landscaping, and other services that help consumers place their home on the open market without upfront costs and high loss to home equity.

Conflicting Incentives for Consumers

Opendoor, when it acts as a real estate investor, further offers 1% of the purchase price back at closing to work with an Opendoor Home Advisor to buy an Opendoor home. According to the company, Opendoor must not be obligated to pay any buyer's agent commissions for this promotion to apply. Having to require such terms limits consumer's ability to use an independent buyer's agent in a transaction. In effect, Opendoor offers a buyer an incentive to forgo independent representation in exchange for a 1% discount. Consumers should never be financially incentivized by a real estate investor to limit their representation when buying real estate from them.

In contradiction to this incentive, Opendoor Terms of Service directly state that: "in making you an Opendoor Offer, Opendoor is not acting as your real estate agent or broker. Opendoor is merely acting as, or on behalf of, a purchaser of real estate. As a seller, you have the right, and it is your responsibility, to independently evaluate and decide whether to accept the Opendoor Offer."

Company further states: "Buyer represents that she has had ample opportunity to obtain legal and other professional counsel of its choosing and that it is relying solely on its own independent judgment and that of its own professional consultants, if any, in entering into the purchase contract and purchasing the property."

From one side, Opendoor offers consumers an incentive in an exchange for "not being obligated to pay any buyer's agent commissions," but from another, requires buyers to "represent that they have had an ample opportunity to obtain legal and other professional counsel." These two propositions contradict each other.

Conflicting Incentives for Listing Agents

Further, Opendoor improperly offers financial incentives to listing agents to help convince consumers to take lower-priced offers from the company, instead of listing homes on the open market. iBuyer offers, accounting for fees and reduced market value, are systematically the most expensive way to transfer ownership.

In this scheme, a listing agent is offered a financial incentive from Opendoor to bring their client to the company for a pre-market offer. No real estate investor (iBuyer) should be able to offer any financial incentive to a third-party representative to persuade consumers to accept their low offers. By offering a fixed financial incentive (currently set as 1% fee of the whole transaction) to listing agents upon acceptance of an Opendoor offer, the company acts to create a conflict of interest between a listing agent and their (present, or potential) client.

A listing agent, in this case, has to choose between having to properly represent a consumer to sell thier home in the open market subject to a competitively negotiated commission, or getting a quick pre-fixed "incentive cash" for handing them off to Opendoor.

Opendoor can change this incentive amount at any time. Today, the company offers 1% incentive of the entire home sale to the listing agent, tomorrow, the company decides to set this incentive at 2%, 3%, 4%, 5% or some other pre-fixed amount, as it likes.

Such incentives are a form of price-fixing and directly affect listing agents' ability to work with their clients on fair terms. Further, these incentives remove listing agents' and consumers' abilities to negotiate home sale representation fees (listing commissions) in a competitive setting.

Opendoor Brokerage

Opendoor is a parent company of Opendoor Brokerage, but they are two distinctly different legal propositions. Opendoor is a real estate investor (iBuyer) and Opendoor Brokerage is a licensed real estate broker. For this reason, HomeOpenly maintains two separate reviews for these entities. All user reviews and the editor's review for Opendoor Brokerage are located here.

Where does Opendoor operate?

Opendoor currently operates in select areas across Phoenix, Dallas-Fort Worth, Las Vegas, Atlanta, Orlando, Raleigh-Durham, San Antonio, Charlotte, Nashville, Tampa, Minneapolis-St. Paul, Houston, Sacramento, Riverside, Denver, Portland, and Austin..