The house flipping company Open Door Labs Inc., which does business as Opendoor, is looking to raise at least $200 million from investors at a valuation of about $2 billion.
The money is meant to help the company expand its business to markets and metro areas across the United States, including Charlotte and San Antonio, according to the Wall Street Journal.
Opendoor offers cash to purchase homes online, then makes basic improvements to them and tries to sell them at slightly higher prices. It also helps secure mortgages and offers title insurance services. The company hopes its expansion will allow it to get more profits from its house flips.
The company bought about $1 billion of real estate last year and plans to buy between $3 and $4 billion this year.
Although some are concerned that Opendoor could falter if the housing market cools down, the company’s executives say they can spot declines in the market before others and manage risk by lowering their offer prices.
Opendoor partnered with Miami-based homebuilder Lennar Corp. earlier this year to help customers sell their old homes and move into their new ones. [WSJ] – Eddie Small