Opendoor Stock | Why We're Avoiding OPEN

Opendoor stock has been rising lately along with all other real estate services companies. Investors need to take a step back first and look at what exposure they're getting from an investment in OPEN stock. It's not a property tech firm, it's more like a property management firm. You see, Opendoor acquires homes which then sit on their balance sheet until they're sold for a profit. With gross margins of 10% during good times, there isn't a lot of buffer for when the property market sees a downturn. Last quarter saw gross margins of 5% which might be further squeezed if the bottom falls out of the residential property market. How many people are keen to buy a new house when mortgage rates exceed 7%? We find Opendoor stock to be way too risky for our tastes, even if they were a SaaS model with no exposure to property process. Want exposure to residential properties in America? Invest in REITs instead.

RESEARCH PIECES USED IN THIS VIDEO:
1. Using Blockchain for Commercial Real Estate
https://www.nanalyze.com/2020/01/blockchain-commercial-real-estate/
2. How to Get Into Commercial Real Estate Investing
https://www.nanalyze.com/2020/04/how-to-get-into-commercial-real-estate-investing/

CHAPTERS:
Intro
Real estate services companies rise
Opendoor's last earnings report
Opendoor's business model
Covenants, debt, and leverage
What will home prices do?
The Opendoor turnaround story
Opendoor cheerleaders
Conclusion

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https://trendinginrealestate.com/home-remodeling-trends/best-stocks-to-buy-now-top-3-high-growth-stocks